U.K. graduate unemployment hit its highest rate in 15 years in the third quarter of 2010, official data showed Wednesday, sparking concerns that the government’s public sector job cuts will cause the rate to rise even higher.

The Office of National Statistics said the jobless rate for new university graduates reached 20% between July and September last year — almost double what it was before the start of the recession in the first quarter of 2008, when it stood at 10.6%.

Employment prospects for young people have been particularly hard hit by the economic downturn, with data last week showing that the number of 16 to 24-year-olds out of work reached 951,000 giving a rate of 20.3% — the highest since records began in 1992.

The unemployment rate for the wider U.K. population stands at 7.9%.

Unemployment is set to rise higher as the coalition government embarks on its plan to cut around 330,000 public sector jobs — traditionally a big employer of graduates.

Liam Byrne, the opposition Labour Party’s Work and Pensions spokesman, said the U.K.’s graduates were in danger of becoming a “lost generation.”

Prime Minister David Cameron said in the House of Commons Wednesday that youth unemployment had been a structural problem in the U.K. for years.

“I think we have to have a really serious examination of how we can reduce the number of people who are not in education, not in employment, not in training,” he said.