To Pay or Not to Pay?

To Pay or Not to Pay?

Unpaid internships are tempting, but do companies benefit?

A strong economy and workforce shortage have been boosting wages for Minnesota’s full-time workers. So the case can be made for expanding the number of paid internships for college students.

“We’ve seen slightly more paid internships,” says Paul Timmins, director of career services in the College of Liberal Arts (CLA) at the University of Minnesota. He’s been following the paid vs. unpaid topic for 20 years. “It does track with the state of the economy,” he says, noting a drop in paid internships during the Great Recession.

In June, many students will start summer internships. “There is pressure on students to put together a portfolio of experiences,” Timmins says, noting that potential employers want college graduates to complete one or more internships.

But many students with mounting college debt are wary of accepting unpaid internships. In a 2018 survey of liberal arts students at the U, almost half said they would consider an unpaid internship “if financial support were available such as scholarships or stipends.” More than 11 percent said they couldn’t accept an unpaid internship. Among liberal arts students who had completed internships, 49 percent said they were not paid. When employers don’t pay their interns, they substantially limit the pool of candidates, says Charlene Myers, the CLA’s internship coordinator. Many students of color or first-generation college students don’t have the money to work for free, Myers says.

The university offers scholarships of $2,000 for liberal arts students in unpaid internships, but it only has funding for about 100 a year.

At the U’s Carlson School of Management, the situation is quite different. About 90 to 95 percent of undergraduate internships are paid.

“Carlson places a lot of students at very large companies,” says Connie Wanberg, who chairs the Department of Work and Organizations. In her 23 years there, she says the number of paid internships has increased. Some Carlson students accept unpaid internships because of the experience they can gain, she notes.

For the 2017–18 school year, average pay for Carlson undergraduate interns was $19.70 an hour, based on self-reporting by students. —Liz Fedor