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Internships – To Pay or Not To Pay

Internships – To Pay or Not To Pay

Author: Moe Harrison /Tuesday, April 16, 2019/Categories: SNI Companies, SNI Financial, SNI Certes, SNI Technology, Accounting Now, Staffing Now

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With summer quickly approaching, many college students are considering taking on summer internships. According to dictionary.com, an internship is defined as “any official or formal program to provide practical experience for beginners in an occupation or profession.” Nowhere does it talk about pay! The most important element of internships is that they incorporate classroom knowledge and theory with practical application and skills developed in a professional environment. Internships are a great way to learn from experts in your desired field, gain relevant work experience, and in some cases provide a way to get your foot in the door at a company you want to work for long term. So, in evaluating internships pay is obviously a factor, but there are other things to consider.

Paid internships in many instances are recruiting grounds for the company to attract the best and brightest coming out of the schools they prefer to recruit from. There is some knowledge gained in these internships, but the primary objective for the company is to secure the graduates they want before graduation. This is very prevalent in accounting where interns are wined and dined while also building personal relationships with those already at the firm. Unpaid internships have stricter labor laws than paid internships and those laws have recently been under the microscope after a slew of lawsuits over the legality of having unpaid interns. Whether or not an unpaid internship is legal depends on federal, state and local laws; for instance in California unpaid interns must receive college credit for their work. Over the last decade there have been lawsuits and settlements made over unpaid internships with some of the largest lawsuits with 21st Century Fox, Conde Nast, NBCUniversal, Hearst Corporation and ICM. The United States Department of Labor now has a requirements test for companies to determine whether or not it’s legal to have unpaid interns.

In addition to the legal ramifications of unpaid internships there are also the moral and ethical arguments against unpaid interns. One argument over unpaid internships is that these roles are essentially entry level jobs and companies are getting around having to pay wages by hiring interns to do these roles. Another case against unpaid internships is that it disproportionately benefits those that come from wealthier families: typically those that are able to take on unpaid internships are middle-to-upper class and these internships give them a leg up once they enter the workforce. A recent study showed that, in addition to a higher GPA, multiple internships helped increase the odds of college students securing a full time role within 6 months of graduation.

With the recent settlements and increasing student college debt, the trend seems to be more in the direction of paid internships vs. unpaid internships. Most employers (apart from non-profit companies) have the financial means to pay for interns and being financially compensated offers a level playing field for students of all financial means to get the valuable experience that internships provide.

The decision to pay or not is the employers, but regardless the prospective interns also have a choice in taking that internship or not. Here are five things you should be considering in an internship regardless of whether it’s paid or not.

  1. Will I be gaining specific experience in the field I am interested in pursuing after college?

  2. What valuable networking contacts or opportunities might this internship provide me?

  3. What soft skills might I learn thru this internship and the people I will be working alongside? Skills related to leadership, problem-solving, communication and teamwork can all be learned through an internship.

  4. Will this internship help in building a strong resume when compared to my peers?

  5. Do I feel this internship will give me insight in to what I may like or dislike in a specific job, a particular industry or in a particular environment/culture?

I hope this helps as you consider offer or doing internships, their financial structure and their ultimate value.

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Moe Harrison
Moe Harrison

Moe Harrison

Moe Harrison is a Regional Vice President with SNI. With more than 15 years’ experience in recruiting and personnel management, Moe has a unique perspective on the top issues and concerns of employers and candidates in the accounting and finance fields.

Other posts by Moe Harrison
Contact author Full biography

Full biography

Moe Harrison is a Regional Vice President with SNI. With more than 15 years’ experience in recruiting and personnel management, Moe has a unique perspective on the top issues and concerns of employers and candidates in the accounting and finance fields.

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