It can be challenging to know if an internship pay offer is “fair,” especially when the internship search process is opaque. Many listings don’t display compensation, and discussions of pay are often stigmatized. While students enter the process often with only anecdotal knowledge of pay expectations, companies hold the advantage of institutional knowledge on the internship market.
Ideally, companies would provide complete pay transparency, according to Ursula Diamond, Director for Student Opportunities at Claremont McKenna College. Full pay transparency means posting exact salaries for all employees, while partial pay transparency discloses pay ranges for roles.
“Most industries and organizations prefer to keep [complete pay transparency] pretty quiet and hidden,” Diamond said. “They’re trying to recruit interns for the least amount of money possible, so the power is with the employers, and so it’s in their interest to try and keep that kind of salary transparency as invisible as possible. Whereas on the other side, as candidates, you want as much transparency as possible.”
For students applying for internships and jobs, pay transparency allows them to consider compensation before applying, as well as to better compare options and negotiate with employers. Pay transparency has even been called “the solution to the pay gap.”
TSL conducted an anonymous survey of 100 5C students who had held paid internships. With a maximum hourly wage of $120 and a minimum of $7, the survey yielded a median wage of $20.50, a mean of $27.99, a mode of $15.00, and a standard deviation of $18.48. Those paid via stipend converted their compensation into hourly earnings. The full data and graphs can be found here.
Among survey respondents, the most popular industry was technology, with 45 percent of participants, and the most popular internship type was software engineering, comprising 27 percent of participants.
Certain industries have larger internship budgets and are more open to negotiating pay than others, Diamond said. For example, if a consulting or investment banking firm brings in a large cohort of interns, they will likely earn the same amount with little room for negotiation.
However, if a student believes a company’s pay offer is too low, negotiating an internship offer can be effective and serve as practice for post-graduation offers, when negotiation is more important.
“You should negotiate, but be realistic,” Diamond said. “If you were to compare yourself to other people who have a similar background, similar resume, applying for the same paid internship, what are you bringing that increases your value to that organization? If it’s a return, you’ve worked there once before, [that’s a] great time to negotiate because you’ve already been trained by them, you know the culture, you know the company.”
Bringing data on industry pay standards can help with negotiations — this is where pay transparency comes in.
“Because you can be like, ‘Actually, a lot of my friends are working in the same industry, or I’ve done my research, and this is the average amount they’re getting paid,” she said.
Along with consulting with friends or college career centers, students can look to websites such as Salary.com, Glassdoor, Levels.fyi and PayScale. Diamond added that this information should be treated as a general indicator of pay expectations, as compensation varies widely by company, position and industry.
Additionally, Diamond recommends using these resources when confronting the application question, “What is your expected salary?” If the application allows, write “negotiable,” she said. If it requires a number, use your research and submit a moderate estimate.
“Lowballing is actually not too bad because they’re more likely to want to interview you,” she said. “Highballing is really problematic because that might exit you from the whole process early. So go with a low to moderate number or put in some kind of range to demonstrate that you’re willing to negotiate.”
While the application may or may not include compensation details, Diamond stressed the importance of not mentioning pay until directly asked or given an offer.
“If you talk about money as one of your interview questions, it signals to an employer that you may be more interested in the benefits than you are in the job,” she said. “And what they’re looking for is loyalty. What they’re looking for is somebody who’s really committed and excited to go into that work and work with a team.”
Once the employer brings up pay, Diamond advises using a three-step process to initiate negotiations: gratitude, excitement and ask.
“Start with gratitude because they want to know that you’re grateful for even having the opportunity to be offered this job or this internship,” she said. “Then excitement. You are excited to join the team. They don’t want to negotiate with you unless they know you are negotiating in good faith. That if they make you the right offer, you will accept it.”
When making the ask, she approved of using a number slightly higher than your goal, with the assumption that the employer will meet in the middle. However, she cautions against coming across as pushy or forceful.
“Be polite, be professional, handle it with grace,” she said. “I often use the phrase, ‘I’m curious. Is there any room for negotiation on the salary number?’ Or ‘I was wondering, my expectations were a little higher on the salary. Is there any room?’ So you’re not demanding anything.”
Moreover, negotiating isn’t necessary for every internship.
“I hear this [myth] from students on my campus: there is an expectation that you always have to negotiate,” she said. “That if you don’t negotiate, you’re leaving money on the table and that every single person is special and deserves more money. Some industries that works, some skills and experiences that works, others it does not.”
For students unable to do a paid internship, taking online courses, volunteering, working on personal projects and doing an unpaid internship can help bolster their skill sets, resumes and network, which can potentially lead to higher-paid positions, according to Diamond. Additionally, students can seek grants to fund unpaid positions.
Although internships have to pass the primary beneficiary test under the Fair Labor Standards Act to be unpaid, Anna Ding HM ’23 had an experience with Research Experiences for Undergraduates (REU) that could fail the first factor of the primary beneficiary test: “The extent to which the intern and the employer clearly understand that there is no expectation of compensation.”
Because both the host university and National Science Foundation websites said REUs are paid, Ding assumed she would receive compensation for her REU. However, after several weeks of contacting various people, it became clear that they never intended on paying the students.
“So then after a lot of back and forth with the department chair and such, and also with my own professors, I was essentially like, I feel like I’ve been deceived in a way or misled,” Ding said. “… And then the department chair was essentially like, ‘OK, OK, I’ll try to find funding, but it’s just because essentially you’re making a big fuss out of it.’”
Yet after months of follow-up, she was met with rejection.
“And she’s like, ‘Oh, it’s an I-9 violation, I can’t pay you,’” Ding said. “At that point, it was like past the summer. It was a situation I was like, I know that it doesn’t make sense for this to be an I-9 violation, but I’m just going to let this go essentially in a position where I, as a student, have no power. It felt very exploitative.”
As a software engineering intern, Ding found that pay for the same title varies widely by company. Last summer, she made $25 an hour at the construction company Caterpillar, and she received four offers for this summer: $25 at 3M, $31 at the PayPal subsidiary Braintree, $48 at Etsy, and $63 at Amazon.
She ultimately picked Amazon’s offer, which included a monthly housing stipend of $2,400. Along with company prestige, pay was one of the main factors in her decision.
“It’s a big motivator,” Ding said. “… If they had paid much less than some other companies, I probably wouldn’t have gone with them.”
While high pay wasn’t her top priority, she wanted at least $35 an hour.
“There’s a little bit of wiggle room,” she said. “If it’s like $30 an hour but like I love the project, that’s not something that I’m gonna sacrifice just for the pay.”
Through a friend’s experience, Ding has seen the importance of pay transparency. A casual conversation with a friend who committed to working at Google in the Bay Area next year revealed that the friend was offered at least $50,000 more than another friend for the same position in New York.
Because she interned at Google twice, the friend’s sign-on bonus was smaller, according to Ding. However, she was told that Google wouldn’t negotiate with her unless she had a counteroffer, even if the counteroffer was smaller.
The situation seemed unjust to Ding.
“Generally, people’s experiences with negotiation … is that people are incredibly manipulative.” —Anna Ding HM ’23
“Generally, people’s experiences with negotiation — and I only really know about the tech industry — is that people are incredibly manipulative,” she said. “… In some ways, you’re sort of forced to be manipulative back because you know how much you deserve in terms of what other people are making and what they’re willing to give other people. But then they’re like, ‘No, we would never do that.’ Even though you know that they have.”
Mason Acevedo HM ’22, who was an engineering intern at Raytheon Technologies for $30.43 an hour, also learned about the importance of counter offers in negotiations through a friend’s engineering job search.
“She spent time being like, ‘Oh, Facebook, Google just offered me this. Can you match that offer?’’’ Acevedo said. “Then they matched it, and she went like, ‘Oh, Skechers, Google has offered me this. Can you match?’ And so she did that to get bumps and see if she could negotiate for more.”
Because it gives more power to workers, Acevedo supports making all salaries public. He acknowledged that such a policy would receive pushback, partly because a person’s salary is associated with their value in American culture.
“We’re kind of weird about money in the US. It’s this private issue,” Acevedo said. “But when you stop to think about it, why? Is that just a part of our culture that we’ve inherited from this capitalist thing, where you favor interests of businesses over human beings? [It] kind of feels like it is. In a world where you can just look up anyone’s salary anytime, I don’t see anyone except a corporation that’s not paying its employees fairly hurting from that.”