Benchmarking Internship Programs

Exploring data and trends to ensure your program is competitive

Benchmarking Internship Programs

Sterling Lexicon hosted a webinar on September 13, 2022 to discuss the results of the Benchmark survey we conducted on Internship Programs. Our interactive approach began as a request from a small group of clients and prospects asking for information about the latest trends regarding the logistics and other elements of intern programs here in the U.S., as well as internationally. We were pleased by the overwhelming response to the survey we posted in August 2022 – clearly this is a timely topic for many organizations as over 100 people signed up for the webinar. 

Our analysis of the data collected in the survey, as well as from polls conducted during the webinar, revealed certain themes - Inclusivity, Alignment, and Benefits - that will be discussed in this report.

About the Survey Participant Companies 

• 85 responses from 69 companies
• All have domestic U.S. programs
• 43% have international programs
• >70% have 2,000+ employees
• Over 46 industry sectors represented
• Largest participation from: Computer Hardware/Software, Engineering & Construction,
• and Finance
• Annual # of interns: 
  • 30% hire 25-50
  • 28% hire >100
  • 27% hire <25
  • 15% hire 50-100

Why Talk About Intern Programs Now?

We found the impact of the tight job market, which continues to challenge employers, was a major factor in why organizations are examining their intern programs. One response has been to reach out to more diverse populations to support the organizations’ DEI initiatives while also filling internship opportunities. Many programs were either suspended or held virtually during the pandemic, and now that hybrid and/or on-site work arrangements are becoming the norm, the revival has shed light on the costs and long-term benefits of internships.

Companies can evaluate individuals in a workplace setting where interns perform meaningful work, which helps streamline the conversion of intern to full-time employee. Interns gain valuable work experience while exploring a career path, building a professional network, and learning about a company’s brand and priorities. Many students complete more than one internship during their college or post-graduate years, showing their interest in particular industries or job functions, often leading to more career advancement opportunities.

Participants in our survey told us the most challenging aspects of running internship programs are ensuring engagement and inclusivity, regardless of location; being able to show the value of the program and alignment to business strategies; as well as ensuring benefits are competitive, especially cash payments and housing options.

Program Responsibility

Responsible for Intern Program

Three quarters of companies indicate Recruiting is responsible for the intern program, followed by Talent Management.

Job Function - Webinar Attendees

We were curious to learn about the job functions of the webinar attendees, so we ran a poll to find out.

Program Management

While ¾ of intern programs are managed in-house, many organizations collaborate with external partners for additional support, and we are seeing more companies take this approach today.

The top 3 areas in which partners assist are travel arrangements, housing, and cash payments. 

Partners may provide additional help:

• Immigration/local registration compliance
• Policy management and administration
• Destination Services for an area orientation and housing assistance
• Pairing roommates
• Moving personal items
• Detailed payroll reporting

Program Administration

The administration of the intern program is most often centralized, though many are completely controlled by the local entity, especially when looking at international programs. We see hybrid programs as well, which can mean a centralized policy with regional management of the specific aspects of the internships. This can facilitate filling roles or functions where there is a skillset gap in particular locations.

For hybrid and local programs, one recommendation we have identified is to engage the local recruiter and managers in the process. We have found in many instances that there is a lack of communication which can create false assumptions, especially about local preferences regarding housing options. Setting expectations around the current cost of rental housing and extended stay hotels is best handled by the local entity.

Support for Interns

The two most common types of support for both domestic and international intern programs are travel and housing. Many domestic programs support interns by providing a lump sum

for travel and housing, as do international programs, though it is often necessary for these programs to support immigration and health insurance.

For internships conducted virtually, employers offered additional support with a WFH stipend. When organizations expect the intern to travel to the work location and find their own housing, it is typical to offer cash only, though the amounts vary, with undergraduates receiving a lower amount than Masters/PhD interns.

Housing

Participants in the survey indicated housing for interns posed challenges due to the lack of inventory and expense. We wanted to know how housing for interns is coordinated and how housing is paid. We learned that half of companies coordinate housing but require the intern to pay the property owner using either their lump sum payment, or regular stipend to cover this cost. Almost 40% of companies do not coordinate housing nor do they pay directly while about 1 in 10 companies manage the entire process.

Nearly all companies allow interns to stay in their own room rather than live with others, and of those companies that do ask interns to room together, the most typical arrangement is either 2 people per 2-bedroom apartment or housing 4 interns in a suite.

Coordination of Housing and How it is Paid:

• Coordinates housing but does not pay directly 50% 
• Does not coordinate housing nor pay directly 39% 
• Coordinates housing and pays directly 11%

Current Housing Program - Webinar Attendees

We were surprised by the high percentage of companies that allow single rooms, so we launched a poll during the webinar asking if this was a new aspect of their housing benefit, and if so, why, or if not, how was housing always managed.

Other Program Elements

We talked with a client that supports a large internship program to learn what other methods they employ to engage with these short-term hires. This gaming company typically hires 100 - 200 interns each summer, and this coming year expect to host 300 - 400 interns. During the pandemic, the program was held virtually, although this year they intend for more in-person work, but because HQ is a high cost area, hiring managers are being given the chance to define whether on-site or hybrid will work best for their group.

The intern program leaders partnered with their Learning & Development team to create a more meaningful way for interns to evaluate success. L&D built a “personal values” course, whereby the interns complete two surveys, one at the beginning and again towards the end, showing their personal development that is unrelated to the company itself. This gives the interns an opportunity to understand what is important to them in a workplace and what is important to them regarding the actual work they do, essentially – what makes them tick. The data is delivered in a matrix format to show what changed over their time in the intern program.

Both domestic and international programs provide an array of benefits beyond logistical help. Providing a salary and organizing intern social events are the most popular value-add benefits.

Revisiting Lump Sum Amount - Webinar Attendees

A few respondents provided details on the cash amounts given to interns, with some offering higher amounts to interns at the master’s or PhD level. For example:

• $500 or $1,000 depending on level
• $2,000 per month for undergraduates;
• $3,000 per month for post-graduates

We also asked if their company provides gross-up support for benefits that contribute to income and learned that 1 in 5 helps, though our webinar attendee poll revealed the following:

Revisiting Lump Sum Amount - Webinar Attendees

• Yes    68%
• No    32%

Intern DEI Initiatives

Sterling Lexicon has many clients that either implemented, or are building, true measurable DE&I programs for their overall company population. The question can become whether interns, who are employed for a brief period, should be included in these strategies.

Our survey revealed that all responding companies have embraced DEI strategies within their intern program or are in the planning stages.

• 94% Candidate recruitment
• 63% Intern event programming
• 57% Mentoring & networking

Intern Program Data Analysis

We learned how important it is for organizations that run intern programs to align with the overarching needs of the business, and to demonstrate the value, companies track certain pieces of data. Satisfaction was the number one response, closely followed by Conversion Rate, Annual Cost, and Acceptance Rate. Most are tracking more than one data point, leading to a robust analysis.

Satisfaction with the program is usually assessed via exit interviews or surveys prior to the end of the internship. Acceptance and conversation rates provide insights into the competitiveness of the program, while understanding the costs, obtaining feedback from mentors and hiring managers, as well as assessing the quality of the work, are also key data points in an analysis.

One of our clients suggests taking the analysis a step further by looking at how long an intern offered full-time employment remains with the company, reviewing overall performance, and following the former intern’s career path and advancement compared to other hires who were not part of the intern program. This longitudinal analysis can provide a more complete picture of program success.

Ideas to Enhance Your Intern Program

Respondents to the survey generously offered ways in which their company enriched their internship program. The chart below shows how the themes of inclusivity, alignment, and benefits are essential aspects of internship program success and competitiveness.

Other ways in which companies have enhanced their program includes the following ideas:

• Raise pay and hire interns for full- or part-time jobs afterwards
• Global Mobility take over management of the program
• More personalized mentoring and training to maximize the value of the program
• Informational tours of other parts of the company
• Add more social events post-COVID
• Set a goal of 25+% conversion rate
• Host more events to expose interns to the company culture
• Offer “Lunch & Learn” sessions with upper management
• If the program is virtual or hybrid, bring interns to HQ, covering all travel and single-room hotel expenses
• Post newsletters for interns and managers to keep everyone informed
• Utilize a chat platform that encourages social connections, even before internships start
• Develop a New Hire Relocation Policy for interns asked to work permanently in another location
• Make employment offers before the internship ends as a retention tool
• Offer a mindfulness course for interns

Key Learnings

• Majority of programs are managed in-house though more are seeking assistance from partners
• 90% do not require interns to room with others
• Paying a salary and organizing social events are common in domestic and international programs
• Companies are seeing the value of intern programs supporting their long-term recruitment strategies
• Competition for talent has pushed companies to reevaluate their intern benefits

Please note not all survey or webinar poll questions were answered by 100% of the participants.