I am doing a degree in English Lit as well, so the stuff I read is probably quite different from what "normal" people read.
I am big fan of Scottish Lit (I know, they talk funny, but a lot of them can actually write quite well) and would definetely recommend
Iain (M.) Banks. He calls himself Iain Banks when writing "regular" fiction, of which I would strongly recommend
The Bridge and to a lesser extent
The Wasp Factory. For some reason he calls himself Iain
M. Banks when writing science fiction, of which I would strongly recommend
Consider Phlebas,
Feersum Enjin and maybe
The Player of Games.
One of my alltime favourites is
Alan Warner:
Morvern Callar.
Looking at American Lit, I seem to be one of the few people who liked
Chuck Palahniuk's
Fight Club better than the movie version. The short stories of
Edgar Allan Poe still rock today.
When it comes to German Lit, I would very strongly recommend anything from
Franz Kafka, especially
Die Verwandlung/The Metamorphosis and
Der Proceß/The Trial.
I'd also strongly recommend
Erich Maria Remarque:
Im Westen Nichts Neues/All Quite on the Western Front which is just breathtaking.
In both cases, I am not sure how well the English translations are, though.
Anyway, I would strongly recommend to anyone to read at all, what you actually read is secondary in my opinion.