Companies may face legal scrutiny when it comes to unpaid internships

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With companies gearing up to start their search for summer interns, they may want to think twice about making it an unpaid internship versus a paid one.

What has happened in the past?

Over the past few years, unpaid internship practices have experienced more legal scrutiny in terms of wages and hour lawsuits. Some of the most recognizable corporations have experiences lawsuits last year, including Warner Music group, Atlantic Recordings, Fox Entertainment group, NBC Universal, Viacom, Sony, and Universal Music Group.
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3 Ways to Make the Most of Your Internship Program

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3 Ways to Make the Most of Your Internship Program

As a recent New York Times article demonstrates, the days of using interns to fetch coffee, pay them nothing and then unceremoniously dismiss them at the end of the internship without so much as a glimmer of a job prospect are far from over in many industries.

But here in Northeast Ohio, the annual ERC/NOCHE Internship & Recent Grad Pay Rates & Practices Survey demonstrates year after year that many employers are taking a very different approach to their internship programs. In order to attract the best and brightest students to their internship programs, employers need to understand what the internship landscape looks like locally, not only from a legal perspective in terms of pay, but also in terms of how much to pay and what is offered to students through the internship experience itself. Here are a few tips and trends from the ERC/NOCHE survey that organizations may want to keep in mind as they look to hire interns in 2014.
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Even More Reasons to Hire Interns & Recent Grads

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According to the 2013 ERC/NOCHE Intern & Recent Graduate Pay Rates & Practices Survey 85% of employers with internship programs in place indicated that they will be either maintaining or expanding their programs in 2013. Organizations also report that 48% of their entry-level positions are filled using new college graduates. These numbers clearly demonstrate an ongoing commitment by Northeast Ohio organizations to building strong internship programs and bringing young graduates into their workforces. However, this year’s survey also reveals some unexpected opportunities and perks that further bolster the importance of hiring interns and recent grads from more of an organizational development perspective.

Building Networks

Employers looking to hire interns or recent graduates continue to collaborate closely with colleges and universities in the area, most often using the job boards at colleges and universities themselves. This strong connection between the area’s higher education institutions and local employers is also thriving on a more personal level with 61% of respondents taking time to build relationships with professors in order to find interns and 40% drawing upon their alumni contacts when seeking new college graduates to fill positions at their organization. Despite a strong focus on online recruiting overall, employers still find value in the face-to-face networking opportunities that their connections to colleges and universities provide.
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Companies Share Common Internship Program Goals

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As the school year begins to wind down, your organization may be looking to hire some additional support over the summer in the form of a college intern. While each organization will undoubtedly vary in terms of the specific needs the internship is designed to fill, the results of the 2013 ERC/NOCHE Intern & Recent Graduate Survey strongly suggest that in general, organizations hiring interns are doing so with a common set of goals in mind.

Top among these goals are “developing a talent pipeline”, “assisting with special project work”, and “obtaining affordable workforce support”. Reaching the two latter goals sounds fairly straight forward- hire an intern for a few months over the summer and hand off some administrative busy-work. However, this conventional approach to internships fails to help, and in many cases may actually hinder, organizations looking to realize the lasting benefits associated with “developing a talent pipeline”. Instead of taking a passive approach to internships, developing a talent pipeline requires a more actively engaged employer.
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Employers Eager to Hire Interns and Recent Graduates

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The results of the 2012 Intern & Recent Grad Pay Rates & Practices Survey, conducted by ERC and NOCHE, showed that an overwhelming majority (83%) of 117 participating Northeast Ohio employers were either maintaining or increasing their internship programs, while almost two-thirds (64%) were in the process of hiring or planning to hire new graduates for positions in their organizations. These organizations look for candidates with relevant majors in their field, high levels of professionalism, strong interpersonal and communication skills, and past work or internship/co-op experience.

Recruitment Trends

Despite a strong online recruiting presence, organizations are primarily using job boards/websites focused on interns or recent graduates to pursue candidates, social media remains low on the list of recruitment methods at for both interns and recent graduates. Interestingly, 2012's survey does mark a small increase in social media recruitment for recent graduates from the preceding years, up 9% from 20% in 2011. However, when compared to more traditional recruitment methods such as job postings on college career center websites or relationships with professors, social media recruitment methods appear to remain a largely untapped recruitment resource. This trend suggests that for tech savvy Millenials searching for an internship or first job, LinkedIn or Facebook may not be the most effective platform through which to reach potential employers.

Benefits of Interns & Recent Graduates

While the overall lack of interest in social media recruiting is consistent with trends in the world of Human Resources, it sits in stark contrast to one of the top emerging benefits of hiring interns and recent graduates, i.e. familiarity with the latest technological advances. Both groups continue to be seen as a key element for injecting organizations with fresh, innovative ideas, particularly in the realm of technology.

Employers commonly express a high level of confidence in the expertise of interns and recent graduates as employees. By coupling this high skill level with a strong financial incentive to hire from within these groups, pursuing interns and recent graduates as future employees is largely viewed as a positive investment in an organization’s future. 

The 2012 survey also reports average starting salaries for recent graduates, which vary significantly depending on the type of degree. Similar to the 2011 data, an engineering degree showed the highest average starting salary for a Bachelors degree.

Average starting salaries for college degrees

Degree Obtained

Average Starting Salary

Masters, Business Administration

$62,500

Bachelors, Engineering

$51,455

Bachelors, Computer Science

$50,000

Bachelors, Finance

$45,750

Bachelors, Information Technology

$44,000

Bachelors, Chemistry

$39,833

Associates, Information Technologies

$37,000

Bachelors, Accounting

$36,912

Bachelors, Business Administration

$35,880

Bachelors, Marketing

$34,687

Associates, Business/Marketing

$31,093

View the Intern & Recent Graduate Pay Rates & Practices Survey

This survey reports data from Northeast Ohio employers about their internship and recent graduate employment and pay practices.

View the Results

Career Centers: Key Stop for Internship Seekers

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Results from the 2011 ERC/NOCHE Intern & Recent Grad Pay Rates & Practices Survey indicate that career center services at colleges/universities remain the top resource utilized by Northeast Ohio companies to advertise internship opportunities.

According to the survey, which is conducted annually by ERC in collaboration with the Northeast Ohio Council on Higher Education (NOCHE), since 2009, over 60% of organizations consistently prefer the use of career centers compared to other sources utilized.

Other sources cited as commonly used include campus outreach (ex. career fairs, advertising), building relationships with college/university professors, as well as alumni contacts within these colleges/universities. 
This suggests that not only do college/university students dominate the internship workforce, but that utilization of their career centers is key to obtaining the internships they seek.

Research done here at ERC shows that career centers provide many benefits for both the employer and the potential intern.  For the employer, at minimum, most career centers offer job boards or an internal website to post internship opportunities.  For students, there are often a myriad of other services their career center offers to both help in their internship search, and in solidifying a career choice.

View the Intern & Recent Graduate Pay Rates & Practices Survey

This survey reports data from Northeast Ohio employers about their internship and recent graduate employment and pay practices.

View the Results