I am now getting into foss since I failed to get in on any of my internships / summer of code last summer, since my piece of paper is effectively worthless. I do have project experience (a course scheduler in C# for .net, a tower defense game in swing, wizard design for a seismometer program the school contracts) but employers don't care about that, especially the projects the school contracted on that I can't show the source to.
So yeah, I've been job hunting for ~4 months (some nice folks on HN even gave me some phone interviews, but it never got past that) and the lack of job experience drives away a vast 99% of employers. I have a good gigabyte and around a million lines or more of assignment and project code I could throw at them, they are just not interested :P