Study: Paid internships deliver strong payoff early in careers

A recent national study co-authored by the University of Wisconsin-Madison's Mindi Thompson, a School of Education professor, reveals that paid internships significantly benefit college graduates in terms of earnings, job quality, and early career progression. The study, published in Research in Higher Education, analyzed data from over 26,000 students who earned their bachelor's degrees in 2016.

It found that graduates with paid internships earned $5,564 more one year after graduation and $9,089 more four years later compared to their peers. Additionally, these graduates were more likely to secure jobs requiring a bachelor's degree and report their first job as part of their desired career. The researchers used a rigorous matching design to isolate the impact of work-based learning experiences by pairing students with similar academic, demographic, and institutional backgrounds.

While unpaid internships, co-ops, work-study jobs, and practica showed no earnings benefits, unpaid internships and practica were associated with a higher likelihood of obtaining a job that aligns with a student's academic field. The research team also identified symbolic capital as the primary mechanism behind the earnings boost, suggesting that employers view paid internships as a strong indicator of a candidate's motivation, professionalism, and readiness.

However, the study highlights disparities in access to paid internships, with Black, Hispanic, American Indian, and Native Hawaiian students more likely to engage in unpaid internships. Expanding access to paid internships could help promote economic mobility, particularly for those who most need the earnings boost.