Economic Snapshot | Unions and Labor Standards

Unpaid interns fare worse in the job market

It’s internship season and offices across the country are filled with interns trying to make a good impression. Do internships lead to jobs? It depends. Evidence shows that paid internships lead to better employment outcomes than do unpaid internships. The National Association of Colleges and Employers (NACE) Student Survey Report provides troubling evidence that unpaid internships are associated with less success in the job market after graduation, both in terms of job offers and salary offers.

  • College students who had an unpaid internship did significantly worse than students in paid internships, whether the job was non-profit, state, federal, or for-profit. The job offer rate for graduates who had taken a paid, for-profit internship was 72% vs. 44% for unpaid, for-profit internships (See Figure).
  • The NACE survey found that regardless of the sector, unpaid interns received lower salary offers than students who had taken a paid internship.
  • Most notably, the median graduate who had taken an unpaid internship in a for-profit firm was offered $19,000 less than the median paid intern in such firms.
Economic Snapshot

Unpaid internships are less likely to result in job offers than paid internships: Share of interns who receive job offers by internship type

Label-Paid Paid Label-Unpaid Unpaid 
For-profit company 72.2%  43.9%
Nonprofit 0 51.7%  41.5%% 
Federal government 61.9%  50.0% 
State/local government 50.5%  33.8% 
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Source: National Association of Colleges and Employers (NACE) Class of 2015 Student Survey Report

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There are other reasons that employers should pay interns, including legal requirements and the fact that students who cannot afford to work for free in the summer are not given the same opportunity to network, as argued recently in the New York Times by Ford Foundation president Darren Walker.

See more work by Ross Eisenbrey