(FORTUNE Magazine) – When 18-year-olds entered college four years ago, dot-com mania was at its height, the Dow was at 11,000, and Who Wants to Be a Millionaire was the top show on TV. Companies desperate to fill their ranks sent thousands of recruiters to college campuses. Entry-level salaries climbed to $70,000 or more. During spring break, headhunters scoured beaches for prey, offering five-figure bonuses for signing on the spot.

Today no one's partying like it's 1999. The class of 2003 is entering the tightest job market since the recession of the early '90s (see "Down and Out in White-Collar America"). According to the Bureau of Labor Statistics, the number of unemployed workers between the ages of 20 and 24 is 1.4 million, up 60% from four years ago. Today's graduating seniors aren't under any illusions either. In a survey conducted this spring, job-search website Monster.com found that 61% expected to move in with their parents.

Even at the nation's top schools, in the most employable majors, times are tough. Northwestern University's School of Engineering typically has 330 graduates each year. In 2000, 70% went straight to jobs and 23% went to graduate or professional schools, while 7% tried to figure out what to do with their lives. Last year nearly a quarter of the class was still looking at graduation (this year's class hasn't yet graduated, but the numbers are expected to be equally grim). The engineering school's top recruiter, Accenture, typically hires about 30 people a year. This year it didn't take any.

If the 2003 graduates have anything to be thankful for, it's that they have low expectations. This year's grads observed as juniors the severe decline in employment opportunities between 2001 and 2002. As a result, they began their job searches earlier. Kiran Varma, a double major in economics and learning and organizational change at Northwestern, finished her resume even before starting her senior year. During the fall she devoted one-third of her waking hours to her job search. By Thanksgiving she had accepted a position at Bank One.

Some recent graduates are choosing options they might not have considered in flush times. Teach for America, for example, received 16,000 applications this year, vs. 5,000 in 2001, and recruiting from nonprofit organizations and the government actually increased from last year. In most fields finding a job simply takes a lot longer than it used to. J.P. Bader, an Indiana University graduate with four majors, including business process management and operations management, began looking last summer, when he sent out more than 250 resumes. Despite 20 first-round interviews and four second-round interviews, he had no offers when he graduated last December. Short on cash, he moved in with his fiancee's parents. In April, nearly a year into his search, he began working at Epic Systems, a software firm. As for the grads who can't find jobs, some are opting to stay in school: Graduate and professional school applications have risen about 15% so far this year. --Christine Y. Chen