More than 30 white-coated criminologists, biologists, lawyers and psychologists are bustling around a crime scene. A rape has taken place in a park, and the suspect has fled to a nearby squat. Criminologists are busy safeguarding the remnants of a sexual assault from contamination, and recording the footprint impressions, soil and clothing samples. Biologists are carefully removing it for analysis, as psychologists and lawyers prepare to interview the distraught victim.

Luckily, however, this isn't a real crime scene: it's a mock rape case set up by the University of Portsmouth, investigated by its criminology and forensics students, and acted out by drama undergraduates. The two-day event allowed students to use forensic skills to secure a "conviction" to a tough test case, and follow it through from the discovery of the crime and evidence analysis to the presentation of findings in a replica of a Crown Court, complete with dock, witness box, public gallery, jury rooms and interview rooms.

The popularity of forensic studies has rocketed over the last decade. TV shows such as CSI, Bones and Silent Witness helped demand for Portsmouth's criminology and forensic studies course rise 13% this year alone. Nationwide, interest has soared, with 8,685 undergraduates and postgraduates studying on more than 100 forensic and archaeological science courses last year, according to the Higher Education Statistics Agency (Hesa). That was up 12% from 2005, when 7,710 students were studying the subject.

But now many of these students are facing career turmoil. The government-owned Forensic Science Service – where many had hoped to eventually work – is to be axed, the cost-slashing coalition government announced in December. And undergraduates have been left anxious about the impact on their careers.

"When I heard the FSS was being axed, I was worried," says Jade Morgan, 22, a student on Portsmouth's criminology and forensic studies degree. "It's due to shut down in 2012 – the year I graduate." The news has not put Morgan off the degree – "there will still be many crime scenes to process, with or without the FSS," she says.

"I aspire to become a scenes-of-crime officer – I've been told that no two days at work are the same, which is exactly what I'm looking for in a career." But she adds: "I'm sure it will be a challenge to find work. It's tough in general to find a job in the current economic climate, but one of my concerns is that when I'm applying for jobs, I'll be facing competition from people who have worked at the FSS."

Even before the FSS was earmarked for closure, there was already a mismatch in supply and demand. The FSS employed 1,600 people – not all of them scientists – while LGC Forensics, Britain's largest private provider, employs 500 people. But with more than 8,500 forensics students in the UK, it's little surprise that the FSS website warns applicants that its advertised jobs see responses from 1,000 applicants.

Some of the FSS's jobs will transfer from the public to the private sector but, experts say, not as many.

"It's too early in the current discussions within the industry and academia to know exactly what the long-term outcomes will be," admits John Cassella, professor at Staffordshire University's forensics department. He says academics – who have mainly previously worked within the forensic, policing, or scientific industries – "have all seen major changes and worked within the parameters available to ensure that standards are maintained, jobs are secured and the industry develops and prospers." This current situation, he adds, "is no different".

But students on the popular course feel differently. Matthew Perryman, 21, is a third-year forensics science student at Anglia Ruskin University in Cambridge. "I've always wanted to work in forensics, my first choice is to work in ballistics recovering evidence from shootings or explosions and working with police and counter-terrorism squads," says Perryman. "If the FSS hadn't closed down and the recession hadn't happened, I'd feel quite confident about my job prospects. Over 90% of graduates on my course at AR have a job in forensics or science a year after graduation – that's one of the reasons I chose it.

"But as things stand, I'm more worried. I'll probably have to study further, do a master's and get more lab-based experience before I get a job. The FSS was obviously most people's first choice for a job after graduating in forensics. I'm hopeful that some of the private companies will fill the recruitment gap, but I'm also considering going abroad, to Europe, America or even Australia. I'll go where the work is."

For now, current forensics science undergraduates should focus on learning general science skills, in case there aren't enough industry jobs on graduation, says Paul Smith, a senior lecturer at Portsmouth's Institute of Criminal Justice Studies. "It's important to teach transferable skills that give students more employment opportunities across a range of careers." He explains: "The focus may be on scientific methodology, enhancing problem-solving skills, research skills, instilling an investigative mindset and a range of other skills to augment the students' employability potential."

However, academics are hoping that there may be a silver lining to the FSS closure: the austerity measures engulfing the policing sector could leave universities the best equipped to step in. "The provision of forensic science services is as prevalent now as it ever has been," says Smith. "I'm sure there will be some business opportunities for some universities, and more importantly I think there will be a greater requirement to collaborate in research and consolidate services with the local authority and police."

Portsmouth has begun working with local police forces to set up the Science and Technology Information Network (Satin), sharing new research, technologies and techniques between academics and practitioners. Students have also been involved in the work, and have secured work experience through it. "The crime scene sector, researchers and undergraduates are all going to have to work more collaboratively in future," says Smith.

For many CSI-loving students, even the tough job prospects haven't taken the shine off a degree in forensics. Amy Foroozandeh, 24, is in her second year of a degree in criminology and forensic studies at Portsmouth. It was, she says, the "thought of being able to link an offender to a crime scene" that inspired her degree selection. "My career goal is to become a scenes-of-crime officer and process all different types of crime scenes," she adds. "The FSS being axed has not disheartened me in my attempt to get the job I'd love to do.