What is the "industry Standard"

Okay......in my experience when the "industry standard" is talked about, its mostly in reference to draughtsmanship ability.
Animation per se, that is the mechanical movement of a drawn object, is usually pretty straightforward in most situations--its just timing and position issues. What makes those things stand out to an employer's eyes is how well the image is drawn, or how well its looks.

That is what a prospective talent can offer a studio--namely their ability to create something that looks good. If they cannot offer that, they will not get hired.

Based on what I have seen in the two walk cycles, your animation skills are solid, but I don't think your drawing ability is where it needs to be based soley on those two samples.
This is the danger of supplying stylized cartoony samples in a reel--the styles can be used as "cheats" by weaker talents to hide deficiencies in their draughtsmanship. This is why life-drawing samples are considered essential in a portfolio because they are a de-facto standard that anyone can gauge talent by.
For example, if you took the skeleton cycle that you have, and animated that as a totally realistic skeleton, instead of a cartoony stylized one, then you'd have something that shows animation AND classical drawing ability.

My feeling about walk cycles is that studios see too damn many of them. Cycles are usually straight mechanical movement.

Big deal. It says nothing, but movement.
Instead, what I have told students is to work BEYOND just plain movement and step into EMOTION.
Do not just animated a cute lil' guy walking.........animate him STRUTTING, he's on his way to a date with the prettiest girl in town and he's king-shit of the moment. How would he move? What would he facial expression be? Would he have any unique movements?
He'd have some feelings in his walk, he's got a purpose and character--and he's more than just an automaton. Very few reels show that kind of thing, and I have seen my share of reels.

See, this offers an employer someone who thinks beyond the schooling most people get. In a school I used to teach at, students would get a head rotation assignment, spun out of a character design assignment. On almost everyone's reel would be these spinning heads.

Why? What does that sell? That you can spin an object? Its straight mechanical movement--it does nothing that anyone else cannot already do.
Instead, with each pass, have the spinning head make a different face at the camera--grinning, sticking out its tongue etc--so the only constant is the image of the BACK of the head--everything else changes in the rotation.

To an employer that says here is someone willing to explore and supply options to consider, and someone willing to sweat it a bit to add a bit more to the job.

1, what does it take to be employed?

Demonstratable ability. You need to be able to show that you can supply work that meets the needs of the studio you are applying for, and work at THEIR level creating the kinds of work they do. The samples you supply need to clearly address that you can do that kind of work.
This all boils down to the need to be able to show that you can problem-solve with the material--usually with your draughtsmanship.

2, how far does my work have to develope to make the mark?

Based on only those two samples....
You need to establish that you can create images that would be used at a studio--to this end, its okay to use an established model design and create some work using that model. This shows a few things: one being that you can work to a specific model (and you MUST be as spot-on as possible to that design), and two that you can tackle something with a certain amount of complexity. Obviously, the more complex a design is, the bigger the risk you take on but you also reap a greater impression if you can pull it off.

Based on your samples......you are not quite there yet, but are pretty close.

3, Would the fact that a person applying for an animation job with very high quality work but no experience in an actual animation job put an employer off entirely from employing them. ?

Yup.
See, you are an unknown quality to them. Unless you can demonstrate in your samples that you know what you are doing, your lack of experience can be a detriment.
Let's be clear about something here......"lack of experience" can be defined as a few different things by recruiters. Some see it as no job experience. Others see it as not enough ability. Depending on how anal or rigid the thinking is of the recruiter, they could snub a highly skilled talent solely because they have not been PAID as yet to do work they are able to do.
That's bullshit, pretty much.......but its the lazy system that's at work in a lot of places.
"Oh, never been paid to do that work?? Then you have no experience."

Phooey.
This is why a carefully created set of samples that clearly demonstrates your abilities are essential. Someone with REALLY strong abilities will get noticed, and being able to show that you know enough (outside of actual work experience) to overcome your lack of actual working experience.
The advantage that a pro has is proven problem-solving ability. They've worked under demands and pressures and likely delivered usuable material.
A greehorn doesn't have that, and so the ASSUMPTION is that they might flake out--that the lovely work in their portfolio took endless tweaking and fiddling to get to the polished stage a recruiter sees it at. This is why tests are common in the biz, because they supply a realistic time-pressure upon the new talent.

[B]
4. what do employers look for in a show reel or interview?[/B]
Ability. Polish--but ruffs are okay too. Appeal. Solid animation. Good ideas. Clear thinking.
If you can do a purely mimed-out bit that makes someone laugh out loud, then you have a winner. If your work can move someone emotionally, then you'll be hired.

5. Does the fact that A "just graduated animation student" make an employer move on to the next reel?

Bullshit. Grads are the fodder, the new blood of the industry--there's the "next big thing" waiting in those reels and portfolios--most studios would be foolish if they dismissed/ignored them. The key thing here is that, with demonstratable ability to work at the level of material the studio creates, a grad is not really any different from a seasoned pro. The ONLY difference is that the "seasoned pro" has the work credits that show they have a proven problem-solving ability that a grad may not be able to show.

Does that help?