Despite Gains, Average Intern Wage Still Below Pre-Recession Level

Additionally, unpaid intern programs face compliance hurdles

Stephen Miller, CEBS By Stephen Miller, CEBS August 21, 2017
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Despite some recent growth following a large post-recession dip, interns working toward a bachelor's degree earned less in 2017 than they did in 2010 when their salaries are adjusted for inflation.

The mean hourly wage for undergraduate interns rose from $16.35 per hour in 2014 to $18.06 per hour in 2017, according to a new report from the nonprofit National Association of Colleges and Employers (NACE).

However, in real terms, those wages haven't regained the ground lost to the 2008-10 Great Recession, NACE's 2017 Internship & Co-op Survey found. When wages are adjusted to 2017 levels, 2010 interns earned a mean hourly wage of $18.93. 

Mean Hourly Wage Rate for Bachelor's Degree-Level Interns: 2010-2017

intern-pay-graph1.png

Source: NACE. (Click to view a larger version of the graph in separate window.)


Wage growth overall has remained slow since the recession's end, given the tepid recovery.

Despite the sluggish growth in pay for interns, however, "in both nominal and real dollars their wages have made gains over the past three years which, when coupled with an increase in intern hiring in 2017, suggests intern wages may soon see a larger boost," the report noted.

The most important criteria that employers use to select the target schools at which they recruit interns are:

  • The location of the school.
  • The majors offered.
  • The perceived quality of their academic programs.
  • The employer's past recruiting experience with a school.

Interns with engineering or physical science majors received higher average pay than interns with other majors, which isn't a surprise, given that undergraduates with science, technology, engineering and math degrees are expected to receive the highest average starting salaries among Class of 2017 graduates.

The NACE survey was conducted from Nov. 21, 2016, to Feb. 17, 2017, with responses from 276 employers.

[SHRM members-only toolkit: Employing Interns]

 

A Sampling of 2017 Intern Pay

As of July 2017, PayScale.com reported average pay rates for interns in the following positions as follows:

  • Information technology interns: $14.87/hour.
  • Marketing interns: $12.27/hour.
  • Public relations interns: $11.81/hour.
  • Social media interns: $10.50/ hour.

Unpaid Programs Present Challenges

Employers that offer unpaid internships face a number of compliance hurdles. For instance, the U.S. Department of Labor (DOL) considers unpaid interns to be "trainees" and so any unpaid intern program must meet these six requirements:

  • The internship must be similar to training that would be given in an educational environment.

  • The internship experience is for the benefit of the intern.

  • The intern does not displace regular employees.

  • The employer that provides the training derives no immediate advantage from the intern's activities. On occasion, its operations may actually be impeded.

  • The intern is not necessarily entitled to a job at the end of the internship.

  • The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.

"You can get away with not paying [interns], but you must keep within the DOL regulations," Sharon Beaudry, a former HR director and currently an assistant professor of management and program director at Oregon Institute of Technology, said at the Society for Human Resource Management's 2017 Talent Management Conference & Exposition in April.

An unpaid program may be appropriate if interns live in the local area, "but if they have to relocate to work for you, that is more challenging for them," Beaudry said.

"The goal … is to ensure that companies are not getting around minimum-wage and other employee protection laws by calling workers 'interns,' when the work and conditions under which the work is being performed [are] no different than that of actual employees," Camille Olson, an attorney with Seyfarth Shaw, told SHRM Online earlier this year.

Related SHRM Articles:

Starting Salaries for 2017 College Grads Hit All-Time High, SHRM Online Compensation, May 2017

Tips for Recruiting Summer InternsSHRM Online Talent Acquisition, June 2017

Employers: Is Your Unpaid Internship Program Legal?, SHRM Online Legal Issues, May 2017

How to Do Internships the Right Way, SHRM Online Talent Acquisition, April 2017

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