This study examines the growth in term-time employment and its impact upon academic attainment among full-time undergraduates at Northumbria University. The study utilises data from three large-scale surveys carried out in each Spring Term between 1999 and 2001. The growth in term-time employment coincides with change in the funding arrangements for students in higher education. This study shows that students in employment are drawn disproportionately from less well-off backgrounds. Many students see employment in term time as a means of keeping borrowing down; they also indicate employment as having a negative impact on their studies. The study investigates the impact on the attainment of students by broad subject group. For three of the seven subject groups investigated (including the largest) the adverse impact of employment on attainment was found to be substantial and statistically significant (the difference in performance between employed and non-employed students in the three groups most affected was more than three percentage points). In contemplating new funding arrangements for students in higher education, the Government should be concerned about the efficiency (loss of attainment) as well as the equity/fairness consequences of the arrangements.