The really bad news about this year's summer internships in investment banks and what you can do about it

I'm one of the lucky ones. I was fortunate enough to spend last summer interning in a front office role in a top tier investment bank and to receive a job offer at the end of it. I'm now helping them recruit their summer interns for 2012 and have a firsthand view on just how brutal things really are out there.

As many articles on this site have already stated, this is turning out to be a tough year to get a summer internship in an investment bank and a (virtually) impossible year to get a graduate job in the front office.

So why has this come about and what can you do about it?

From what I see, the reason for the lack of graduate openings is pretty straightforward. Markets took a turn for the worse this year, banks have made a lot less money than they anticipated and are in cost cutting mode. As a result, they decided to hire a lot fewer interns than they thought. This meant the conversion rate for summer intern was at a historical low. Almost every bank filled their graduate class with the top summer interns and was spoilt for choice in the process.

The bad news is that the surplus interns from summer 2011 are having a negative impact on summer internship applications for 2012. Unable to apply for front office graduate jobs, last year's summer interns are focusing their attention on securing another summer internship in 2012.

This means that if you're a second year student applying for a summer internship now, you're competing against third years who've got internships under their belts already. These former interns are arguably more attractive than students with no directly relevant work experience. They also have a lot more interview experience and are able to impress interviewers with examples of knowledge gained the previous summer.

It's not the first time this has happened. Many of my friends who completed internships in the summer of 2010 didn't get converted, and they too were forced to apply for another internship in summer 2011. Every single one of them got multiple offers and received a graduate offer from the bank they ended up interning at this summer.

What does this mean for you? Firstly that process of getting a job at an investment bank appears to be becoming more protracted than ever: you may need not one, but two internships before you get anywhere.

Secondly, that if you're in your third year, haven't completed an internship in an investment bank and still want a front office job when you graduate, you need to get real. At this stage, you need to be thinking of applying for vacancies in the middle or back office. If not, you need to be considering an MSc.

Failing that, you need to change your approach entirely. The big investment banks aren't the only financial services employers. Try approaching smaller firms (see the FSA register for a list of all the financial firms in the UK).

Alternatively, you could always apply to a Big Four Accountancy firm, complete an ACA and apply to banking in a few years' time when conditions have, hopefully, improved.