The issues of underpaying and/or miss-classifying interns have been hotly debated. But a new survey reported by the Wall Street Journal found that not only are more companies raising intern pay, more employers are also offering interns benefits such as health insurance and access to retirement savings plans, with long-term hiring plans in mind.
The Journal, citing a survey from the National Association of Colleges and Employers (NACE), reports that interns are also receiving record level job offers in 2016. Just under three-quarters (72%) – the highest since 2008 — received offer letters when their internships ended.
The survey, which looked at internship programs at 271 large companies including International Business Machines Corp. (IBM's interns can choose health insurance and 401(k) benefits), found that in 2015 only 16.7% of the employers surveyed offered health insurance. This year, some 46.5% offer medical coverage.
While employers are being more generous with interns, they also are cutting back on internship offers and being more choosy with recruitment. Edwin Koc, director of research at NACE, said employers are more focused on turning interns into full-time employees than ever before.
And, he said, the cost risk for employers with healthcare is low, because interns – mostly in their 20s – frequently reject healthcare coverage because they are still on their parents' plans (the Affordable Healthcare Act gives them coverage until 26).
The offer of insurance is a positive gesture and a good start in the expected recruiting wars for top graduating talent. For example, a different NACE survey of nearly 10,000 students graduating from college in 2015 found 79% ranked "a good benefits package" above high starting salary and diversity in their first major jobs. So far employers who use interns consider this a worthwhile strategy, with low risk, high reward.