Whether you’re earning your degree at a local community college or living halfway around the world to save money attending a foreign university, you’ve probably considered pursuing internship opportunities in your field.

You’re not alone. According to the National Association of Colleges and Employers’ Class of 2015 Student Survey, 62.8% of students in the class of 2015 participated in an internship at some point during their college careers. That represented an uptick from the previous year.

At some colleges and universities, internship participation is much higher. U.S. News identified 10 American institutions where “almost everyone gets internships.” Even at the lowest-ranked school, 94% of students wore the “intern” badge during their college careers.

There’s an endless variety of internships out there, covering hundreds of specialties, dozens of industries, myriad different types of work. However, the biggest and simplest distinction of all involves compensation: Does the internship come with a wage or stipend? If so, how generous is it?

According to NACE, approximately 39% of all internships are unpaid. Unpaid internships are most common in the nonprofit sector, where they account for 67% of all internships. The state and local government sector is a close second, with 61.7% of all interns in that category forgoing pay.

What Is an Unpaid Internship?

First, it’s important for prospective interns to understand what an unpaid internship is and is not – and what it legally can and cannot be.

The For-Profit Unpaid Internship Test

However, there’s a longer, more legalistic answer that acknowledges legitimate concerns about the potential for abuse and exploitation in unpaid internship programs. The Department of Labor’s Fact Sheet #71 outlines six conditions that must be met by unpaid internships created and offered by for-profit companies:

  1. The internship is “similar to training which would be given in an educational environment,” despite occurring on the employer’s premises.
  2. The intern does not replace or displace existing employees and works under the supervision of existing staff members.
  3. The internship is given for the benefit of the intern. “Benefit” is broadly defined, but can include teaching and learning new skills relevant to the intern’s profession, imparting relevant knowledge, completing self-directed projects in a real world setting, and earning college credit toward the intern’s graduation or degree requirements.
  4. The employer “derives no immediate advantage from the activities of the intern; and on occasion its operations may actually be impeded.”
  5. The intern is not automatically entitled to a paid position at the conclusion of the internship.
  6. The intern and employer mutually agree that the intern is not to be paid for the duration of the internship.

For-profit companies whose unpaid internships do not satisfy all six of these criteria may be in violation of federal minimum wage laws. The Department of Labor encourages unpaid interns who believe that their work does not meet all six criteria, or who otherwise feel that they are being abused or taken advantage of, to file a complaint online or by phone. All complaints are strictly confidential, though the DOL has limited authority to compel employers to pay back wages.

The rules governing unpaid internships are much looser for nonprofit and public-sector organizations. At nonprofit and public organizations and agencies, unpaid interns are equated with volunteers, and are allowed to perform tasks that benefit themselves and the sponsoring organization. In Fact Sheet #71, the Department of Labor does stress that it is exploring whether additional regulations are needed to govern the activities and duties of unpaid interns outside the for-profit world, so this is subject to change in the future. And the National Council of Nonprofits does advise its members to clearly categorize interns as volunteers, trainees, or employees, to minimize ambiguity and maximize legal compliance.


Advantages of Unpaid Internships

Money isn’t everything. Even so, the lack of compensation can be a deal-breaker for students considering unpaid internships, particularly if they don’t have a part-time job, savings, or financial help from their parents.

So, why should you consider an unpaid internship over a paid alternative? These are among the biggest benefits of unpaid internships.

1. They’re Easier to Get

Especially in the nonprofit sector, unpaid internships are more akin to volunteering opportunities than true jobs. Many under-staffed, under-budgeted organizations welcome interns, who provide critical support and can quickly find themselves handling important tasks.

2. They Offer Valuable Real World Experience

Real world experience is always a great complement to classroom learning, even in scholarly disciplines such as the social sciences and mathematics. For instance, a summer internship in the risk management department of an investment bank can open a math major’s eyes to the wealth of potentially lucrative, enriching opportunities available to the discipline’s graduates. That’s hard to see from the classroom, or even from the career counselor’s office.

3. They Look Good on Your CV

Internships of any kind look good on your resume or CV. Employers seek well-rounded, agile candidates who’ve sought opportunities outside the classroom and have added practical skills atop a foundation of relevant knowledge. Even if you don’t receive a job offer at the completion of an unpaid internship, your experience is likely to open new doors in the future.

4. They Can Earn Course Credit

Most universities happily provide course credit for qualifying internships, paid or unpaid. Depending on the internship’s rigor, time commitment, and final project or report requirements (if any), it can qualify for anywhere from a single credit or less, to the equivalent of a full course. If you’re looking for any excuse to earn credits outside the classroom, an unpaid internship could be the path of least resistance.

5. They Can Illuminate New Passions or Skills

Real world experiences can turn unpaid interns on to passions or skills that they didn’t know they had. These interests and abilities don’t have to be directly tied to interns’ majors or internship duties either. For example, a challenging, poignant evening internship at your local food shelf might convince you to switch your major from sociology to nonprofit management or something related to public policy. That decision could well change the course of your career (and life) for the better.

6. They May Expand Your Professional Network

Internships offer unmatched opportunities to forge new professional connections that can lead to future opportunities. Every staffer at the organization for which you’re interning is a potentially valuable contact. The network benefits can actually be better at smaller organizations, where the slimness of the available contact pool is offset by the likelihood that you’ll have direct contact with senior executives, whose larger networks tend to include people responsible for hiring and strategic decision-making at similar organizations.

7. They May Lead to a Real, Paid Job

Unpaid interns are not entitled paid job offers at their internships’ conclusion. However, such offers can and do happen in the real world. And, due to their network-expanding powers, unpaid internships that don’t directly lead to paid positions with the organization supervising the internship can lead to paid jobs (or, at least, interviews) with other organizations in the industry.