Paying to work

KANSAS CITY, Mo. – Lillian Madeje, newly minted 2010 graduate from Park University based in Parkville, Mo., is one of the lucky ones. She’s getting a paycheck.

It’s an internship, not a permanent job, but it’s paid – and she didn’t pay to get it.

That distinguishes her from many of her peers in a year when only about one in four of this year’s college graduates have landed jobs in their chosen careers. As a result, thousands of college graduates this summer are paying internship-matching companies for the opportunity to work – often for free.

“So I’m really grateful to get a paid spot,” said Madeje. “But I understand why my peers would pay to do that – pay for an internship – because you need that work experience on your resume to stand out from the others. With so many looking for a job, the competition is insane.”

Students and their parents, many saddled with college tuition debts, are paying hundreds of dollars, and in some cases up to $10,000, to services that promise to provide summer internship matches with companies.

The nonprofit Washington Center and the for-profit University of Dreams and Fast Track Internships were deluged with applications last year and this year from students and graduates searching for job experience. The services help students spiff up their resumes and target employers for summer internships that the students couldn’t find on their own.

Services that cost the most, such as University of Dreams, also provide room, a meal plan and even entertainment activities while the students work – with guaranteed placement or your money back.

Some internship placement programs offer limited scholarships. Mike Smith, Washington Center’s president, said more than 80 percent of the 750 summer participants this year are getting aid in scholarships, grants or loans.

The lower-cost Fast Track program charges $799 to help students apply for unpaid internships and $999 for paid spots.

Steve Rodems, owner of Fast Track, said the company would not reveal its placement success rate, but he called it “very high.”

“We couldn’t stay in business if we failed very often,” he said. We have about $225 per student in costs in research time, materials, stationery and mailing on our end, and they get their full fee back if they don’t find an internship.”

The services scope out the marketplace and identify employers that might be ripe for internships. Most of the companies haven’t even posted internship openings.

“We’re doing about 70 hours worth of prep work for the student who really doesn’t have that time or expertise” to target and create appropriate opportunities, Rodems said.

Rodems encourages students to work first through their college placement offices “because, after all, they’ve already paid for that service.”

David Gaston, director of the University of Kansas career services center, agreed.

“We want to help our students learn important job-hunting skills that will help them throughout their lives,” Gaston said. “Programs that offer to place you in the position don’t require you to develop those job-search skills.”

On balance, college career placement officials have mixed views of fee-based internship placement services.

Eileen Kohan, executive director of the career office at the University of Southern California, said students and parents at schools like hers expect the school to help link students with internships.

“We haven’t had that many pay for internship programs,” Kohan said. “But if they’re doing it for the experience of living in another city or experiencing a profession, I can see why not having to negotiate housing and food in a strange city would be good.”

KU’s Gaston acknowledged that such services can be helpful for students looking for international opportunities.

But Kohan pointed out something about paying for internships that bothers many people: “The interesting part is whether parents can afford to write a check.”

Even with financial aid, pay-for-an-internship programs may give more resume-building opportunities – and a leg up in the competitive job market – to those who can afford to pay. Indeed, some parents are forking over tens of thousands of dollars at auction for internships for their offspring.

Websites such as CharityFolks.com and CharityBuzz.com have offered internships for sale, a practice that has become especially popular in the film, music and fashion industries.

Another complaint is that unpaid internships walk a fine line between legality and violating the Fair Labor Standards Act.

The government’s six-point test for unpaid internships – often called outdated and open to interpretation – includes such requirements as the employer should derive “no immediate advantage from the activities of the trainees.”

Despite the rules’ fuzziness, the Labor Department this spring put employers on notice of closer scrutiny.

The National Association of Colleges and Employers said only one in four of this year’s college seniors had a full-time job offer in hand at graduation, so internships were being pursued at any price. This year’s graduates are competing with millions of experienced job hunters, about 46 percent of whom have been searching for more than six months.

“This is in no way an average economy,” said Dustin Williams, a career counselor at the University of Missouri-Kansas City. “It could take a year or more for graduates to find a job unless they were serious job hunters who started networking aggressively and early and were clear about what they were looking for.”