Now, you’ve got a finished novel, so my advice is slightly different: see if you can carve out a segment of that novel that stands alone as a short story (even if you have to write a new ending for it that contradicts how you used the material in the novel), and try to sell that.

Depending on what it is that you write, you might do better with one of the larger small presses than you have done so far with the smaller large presses. Paolo Bacigalupi became one of the top names in SF with a novel published by Night Shade Books. It and PS Publishing, Subterranean, Tachyon, and others are all very credible options these days. (There are also some excellent Canadian houses, but they tend to only publish Canadians, since they can get arts-council grants to do so.)

Are you going to the World Science Fiction Convention in Chicago next month, or the World Fantasy Convention in Toronto in November? Either is a good opportunity to meet editors face-to-face (WFC is the better of the two for that), and although I never used to counsel this, it does seem that personal contact can help a bit these days.

Finally, I should tell you that “the market is tough” line is nothing new from publishers. They’ve been saying it to first-time authors for at least a full decade now. And it IS indeed tough, and has been for all that time.

Should you give up? To answer that is way too much responsibility for me to take. All I know is that if I had given up after three novel rejections (which came with kind words from the editors), I wouldn’t be where I am today — and I wouldn’t be happy.

I sincerely wish you all the best of luck.