In a sign of the times, a small but rising number of B-school interns—once coveted by companies—will work for free this year
Internship salaries may be up this year, but that doesn't mean everyone's going to get paid more—or at all. Even MBAs. Unpaid internships, long associated with arts and social sciences, have crept into the monied grounds of the business school campus.
With the financial crisis forcing internship hiring down 21% for this coming summer, a rise in unpaid positions isn't exactly surprising. But until now, unpaid work for MBAs was largely unheard of.
Jack Oakes, director of career development at the University of Virginia's Darden School of Business, says in a typical year unpaid internships make up less than 1% of placements. This year? Think closer to 5%, or possibly as high as 10%.
That could be the case for a lot of schools, says Stacey Rudnick, MBA career-services director at the University of Texas at Austin's McCombs School of Business. Usually McCombs sends 5% of students to unpaid internships, but Rudnick predicts many schools will be sending at least 10% down that path this year. Another first for the program: McCombs will solicit companies for unpaid work this summer, along with the standard requests for paid internships.
The trend isn't limited to small companies and nonprofits, either. Private equity firms, hedge funds, and other fairly large companies have all expressed interest in unpaid labor, career-services directors say. While the trend toward unpaid internships is pervasive across sectors, not every school is seeing an uptick—New York University's Leonard N. Stern School of Business hasn't seen an increase. At Cornell University's S.C. Johnson Graduate School of Management, there's been a rise in unpaid positions on job boards, but only up to about five postings.
A "Personal Decision"
The University of Maryland's Robert H. Smith School of Business hasn't received an outpouring of postings for unpaid internships this summer either. But many more Smith students have expressed an interest in working for free.
Career-services directors stress the internship choice is a "personal decision." And if the only way to get MBA-level experience at a prestigious company is by working unpaid, it's probably a good idea, they add. "There's nothing on a résumé that says you need to show whether or not you were paid," says Oakes.
In all, that's good news for MBAs hoping to pull down big paychecks at some point in the future—that is, if they can afford to scrape by without a paycheck now.