Universities' demands for the right to charge differential tuition fees received an 11th-hour reprieve this week as the government's plan to deny them moved nearer the statute book.
Shadow education secretary Stephen Dorrell this week unveiled research showing that more than a quarter of employers target an elite group of "top" universities for recruitment.
The findings, from the Graduate Employment and Training Report, challenged the government's argument that as all graduates get equally improved job prospects, they should all pay a blanket higher education tuition fee: a means-tested Pounds 1,000 a year.
Mr Dorrell said the findings "raised question marks" over the plan to prevent differential fees through Clause 18 of the Teaching and Higher Education Bill.
But this week, the bill's passage looked smoother as Liberal Democrat peers dropped a motion to recommit the bill to its committee stage.
"Dearing said the door should be left open to charge differential fees, that is why we have opposed Clause 18," Mr Dorrell said. "Most people think that fee flexibility means the upwards flexibility to charge top-up fees, above the Pounds 1,000, but many institutions would like the option of downward flexibility."
The report, commissioned by Hobsons from the University of Cardiff, showed that universities must be more responsive to business needs, Mr Dorrell said.
The research, which included interviews with 374 employers, found that: * 67 per cent of employers target specific universities
* Employers favour universities that demand high A-level scores over universities' general prestige and age
* More than half of employers think universities are improving standards, despite the increase in student numbers
* There is a "skills gap" between what employers want and what they get from new recruits.