Internships: The Ultimate Return On Investment For Today's College Student
This post was written by our friends at forbes.com
Rising tuitions and student debt have increased discussions surrounding financial accountability and return on investment in higher education. Politicians and business leaders have proposed a wide variety of solutions including loan forgiveness programs, federal funding for higher education, and incentives for expanding academic programs for in-demand fields, and more.
Although colleges have a responsibility to offer relevant degrees and demonstrate fiscal responsibility, the proposed solutions do not guarantee that a student will secure employment. A student can graduate with a double major in engineering and business, debt-free, and still find themselves unemployed at graduation.
Hence, the value of a college degree depends on the intersection of financial cost, subject matter expertise, and ability to secure employment.
Securing employment is a combination of two factors:
• Building experience
• Job search competencies
Fortunately, most universities offer career centers which help students develop job search competencies such as resumes, cover letters and interviewing. Institutions can increase the career success of their graduates simply by encouraging students to access career services. However, if students do not simultaneously build experience, they may create significant short- and long-term barriers to their career success.
Internships and other experiential learning opportunities are the final key to maximizing the value of their college degree.
Internships: The New Entry-Level
Phil Gardner, Director of the Collegiate Employment Research Institute at Michigan State University, reports that employers shifted from accepting candidates with limited experience in the early 1990s. Today, employers expect candidates to have the experience before applying. This shift has drastically changed the process of entering the workforce.
Researchers at the Georgetown University Center on Education and the Workforce found that 63% of college graduates who completed a paid internship received a job offer, compared to 35% who never interned. In addition, graduates with paid internships received a starting salary that was 28% higher than their peers without internship experience.
Higher starting salaries impact graduates’ ability to repay debt and have long-term implications on career earnings. Merit raises are typically determined as a percentage of salary; hence, the higher the starting salary, the higher the raise.
In addition, recruiters often use previous compensation as a baseline for salary negotiations. Again, the higher the starting salary, the higher the offer.
Integrating Internships Into Higher Education
Many colleges and universities have already started integrating internships and applied learning opportunities into the student experience.
Institutions like Northeastern and Drexel have created cooperative education (co-op) opportunities where students alternate semesters of academic study with semesters of full-time employment related to their career interests. Other institutions offer course credit for internships but only a select group require student participation.
Arizona State University (ASU) has taken a unique approach by offering professional-level opportunities for students at the institution. While many schools employ students, many student workers are only given administrative tasks such as filing, data-entry, etc.
ASU trains student peer career advisors to coach their fellow classmates on job search skills. In addition to increasing the reach of the career center, the peer advisors gain professional-level experience that will stand out on a resume.
Career peer advisors also have the opportunity to apply for promotions, negotiate raises and participate in performance reviews, something many students do not experience until their first full-time position.
This program is a win-win for students and ASU. It provides students with valuable experience and professional skills training while the institution gains needed human resources at an affordable rate.
The Unpaid Vs. Paid Internship Dilemma
In recent years, high-profile lawsuits such as the Black Swan case have brought unpaid internships to the national stage.
According to the College Employment Research Institute’s 2015-1016 Recruiting Trends Report Brief, 71% of employers provide paid internships. The remaining employers offer a combination of paid and unpaid internships (14%) or exclusively offer unpaid internships (15%).
Unpaid internships are most likely to be found in arts and entertainment (55%), educational services (49%), government (27%), healthcare and social services (48%), information services (17%), and nonprofits (53%). In addition, small companies are 17% more likely to offer an unpaid internship than large companies.
While internships (paid and unpaid) can be extremely helpful to students, the debate over unpaid internships is about more than legality. Although there are circumstances in which unpaid internships are legal, students with demonstrated financial need often cannot participate in unpaid internships, regardless of the value the experience may provide.
For students from low socioeconomic backgrounds, turning down internships impacts more than their summer plans, as internship participation is directly correlated with job search success and salary earnings.
Some universities (University of Denver (DU), Washington University, University of Richmond, etc.) have developed programs to fund relevant unpaid internships for students with demonstrated financial need.
DU offers a scholarship program to support students who secure relevant unpaid internships. Through this program, a 2015 recipient interned with the U.S. Mission to International Organizations and found himself 25 feet from last summer’s negotiations in Iran. In addition, DU recently created an endowment to finance unpaid internships for future generations of students.
The value of a college degree is a combination of cost, subject matter expertise, and ability to secure employment. While revising degree options and controlling costs may have a positive impact on the return on investment of a college degree, it will only help if students can secure employment.
Increasing emphasis and access to relevant, meaningful internships allows students to build experience, gain abilities and professionalism and practice their job search skills.
Investing in internships help students succeed in their first job and sets them up for long-term career success, extending the value of their college degree into their 40+ year career.
November 16, 2016
- Blair Webb University of Denver's scholarship program to finance unpaid internships is a game changer! Hopefully more universities catch on and develop their own programs to assist ambitious students from low socioeconomic backgrounds.