Boost Business – Hire a College Intern

When Blake Mycoskie decided to donate a pair of shoes for every pair his company sold, he knew the margins would be tight. The more his business grew, the more it gave away — and the more it gave away, the faster the business grew. TOMS Shoes, the company he launched in 2006 as a hybrid between a for- and a non-profit business, has since distributed more than 60,000 pairs of shoes to children in remote, poverty-stricken regions of Argentina and South Africa, while getting his shoes into big-name stores across the United States. All this with just a handful of employees.

To balance his social goals with rising labor costs, Mycoskie turned to a group of highly motivated laborers willing to work hard for next to nothing and have fun doing it — college interns.

“It was a natural fit,” Mycoskie says. “College students were really drawn to what we were doing. At that age there’s not a whole lot you can do to make a real difference in the world, and that’s what we could offer them.” In return, Mycoskie was able to double his staff without getting buried in payroll costs. Today, nearly half of his 22 full-time employees are former interns.

In recent years, fast-growing businesses like TOMS have begun tapping into a student internship market once dominated by big corporations. But where Goldman Sachs, Coca-Cola, and Disney attract the best students with the promise of a prestigious, eye-catching entry on a resume, smaller companies are now realizing they can counter with an offer of a real-world, hands-on experience running a business. According to recruiters and employment experts, that’s proving to be a highly competitive offer.

Yet, beyond payroll savings — last year, the average wage for college interns nationwide was just $15.99 an hour — an effective internship program can pay off for growing companies in a number of unexpected ways, from getting an edge in the battle for talent to providing valuable lessons in managing a bigger staff.

“Most small-business owners have tended to think about interns as some neighbor’s kid who needs something to do for the summer,” says C. Mason Gates, the founder of Richmond, Va.-based InternDirect and president of internships.com — services that help match employers with interns. “They’re only now starting to recognize the real opportunities out there to build their businesses.”

In a survey of 276 U.S. employers by the National Association of Colleges and Employers — including about a quarter with fewer than 500 employees — nearly 90 percent said they now have an internship program in place. As many as 62 percent of college hires last year had held internships, employers said. Overall, employers reported that 30.7 percent of their new college hires came from an internship program.

“For an employer, it’s like having an extended interview with a job candidate,” says Camille Luckenbaugh, the group’s research director. Still, the process is a two-way street, she adds. While employers are able to screen interns to fill full-time jobs down the road, interns can equally suss out an employer. That can be mutually beneficial, she says, since it reduces the risk of bringing someone onboard who either doesn’t fit in or who has false expectations about the job.