What is the Real Worth of an Internship?

What is the Real Worth of an Internship?

 

Working as an intern is a desirable addition to a CV and is valued by employers in the recruiting process. Ranging from unpaid accredited placements to paid full time internships the opportunities available are extensive, but often competitive. My four-week internship placement at RealWorth gave me an insight into the benefits of spending time within a company, maximising an opportunity to gain experience and learning about a new field. But what is the actual value of completing an internship and how can employers maximise benefits to create a worthwhile opportunity for both intern and employer alike?

A 2017 Report by the Department for Education examined how internships can be made more effective and why employers create placement opportunities. It found the main reasons internships are offered is to invest in the future talent pipeline of the company and to fulfil a sense of corporate social responsibility. Employers noted the main benefits as developing existing staff’s knowledge as well as learning from the new skills brought to the business by interns.

RealWorth’s motives for recruiting summer internship placements were not dissimilar to those presented in the Department for Education report. When asked, RealWorth staff cited their main motives to be; to help manage demand of an increasing workload, and to contribute to the range of opportunities available to undergraduates. The placements were paid meaning that, unlike most internships, interns were expected to produce work that could be used to support company outputs, and the position was not primarily and solely a learning experience. This created a balance of training and contribution that led to positive outcomes for both parties within the employer-employee relationship. The intention was also to create a work environment where everyone felt valued and respected, and it was believed that by creating paid placements, I, and others, would not feel overworked or undervalued. In this way the intention was to produce benefits over and above those presented in the Department for Education’s 2017 report.

What is the RealWorth?

 

In order to best illustrate the social value benefits from my internship at RealWorth, I conducted a Societal Return on Investment evaluation using myself as the sole stakeholder. The primary data used in the evaluation came from a feedback questionnaire that I completed part way through my internship about my general and specific views of the internship experience. From here I identified a range of anticipated changes and outcomes that created societal value to me personally. The feedback form was used as a source of evidence confirming my stance on certain aspects of the work, and my overall experience. Table 1 shows the anticipated changes (outcomes) produced from my feedback form responses.

Table 1: Anticipated Changes from the features of an internship

Feature Anticipated Change
Wellbeing Increased wellbeing from completing interesting and stimulating work.
Wellbeing Increased wellbeing from improved confidence in my own abilities. This included coping with workload and time requirements, successful opportunities to learn and ask for help, and developing my ability to work in the consulting sector.
Skills and Knowledge Increased skill due to ample opportunities to learn and ask for help as well as due to training and explanation of tasks and freedom to complete work in own time.
Wellbeing Increased wellbeing from feeling supported by supervising staff and feeling included and valued.
Wellbeing Increased wellbeing from feeling comfortable within the work environment and the team.
Professional Growth Increased employability as a result of the experience of working in an office environment, learning new skills and experience of work meetings.
Wellbeing Increased wellbeing from being comfortable communicating own ideas.
Professional Growth Increased employability from improved understanding of the sector.
Wellbeing Wellbeing due to increased confidence from being independent, and excellent overall satisfaction of the experience.

 

These outcomes were calculated to create £4,480 of societal value (present value). The financial input for the SuROI ratio was equivalent to my pay for the four-week period. As shown in Table 2, this value was £1,390 and generated a SuROI ratio of 3.22, meaning that for every £1 invested in me as an intern, £3.22 of societal value was created.

Table 2: Total Value created and SuROI ratio

Total Present Value Created* £4,480
Inputs £1,390
SuROI Ratio 3.22

*This is the Present Value (PV) of the total value generated. A discount rate of 3.5% has been used to calculate the PV. This results in a lower value than that used in the amounts shown in the distribution tables elsewhere.

The total value created was generated from outcomes in the following areas (factors):

Employment

  • This encompassed the employability gained from the time I spent at RealWorth as internships provide the insight into what is available in the jobs market, often in areas that aren’t widely understood or visible.
  • At RealWorth this experience included general benefits, such as working in an office environment and gaining new expertise as well as more specific knowledge like increased understanding of the sector.
  • For the purpose of accurate mapping these outcomes were streamlined into one proxy – increased employability. This was calculated to create £2,060 (45%) of the total societal value and was the largest contributing factor to the combined value calculated.

Education and Training

  • This was based on the new skills that were developed as I fulfilled my role and provided a practical way to learn the skills necessary to work in a specific sector.
  • RealWorth offered a chance to work on a range of projects to see where social value can fit into development. The opportunity to ask questions and understand the complex thinking behind decisions was an insight into the subjective nature of the field.
  • The outcome “learning a new skill” created £1,050 (23%) of total societal value, with the majority created in the first year due to a high drop-off rate for this factor.
  • Drop-off is high because positive outcomes are short-lived; this is due to the short duration of the internship although some skill are transferable and last longer.

Wellbeing

  • This factor accounted for the increased independence and confidence gained from an internship while working in a supportive environment.
  • Individually, interns should be able to increase in personal growth because they gain new skills and are given responsibility to develop new techniques and to overcome challenges.
  • Organisation and time management is a significant aspect of being independent and reliable for employers, and the confidence this provides is a benefit for people undertaking internships.
  • Wellbeing was calculated to create £1,480 (32%) of societal value due to the money generated from increased confidence.

Overall, the total societal value of my internship was £4,590, with 45% of that value being derived from Employment, 32% from Wellbeing and 23% from Education and Training. This is illustrated in Figure 1 (below) which shows the spread of value created across the three areas.

Figure 1: Societal Value Generated by Factor

 

The societal value was calculated over a five-year forecast period to account for the potential of long-lasting impacts of an internship as well as the decrease in value over time as new experiences are gained and old experiences are forgotten. The findings shows a significant decline in value after the first year from £2,856 to £821 by the second. By the fifth year this had reduced to £175. This was calculated with the assumption that more expertise and experience in new areas would develop over time and surpass the employability, skills and confidence gained at RealWorth in the brief 4-week period of the internship.

 

Figure 2: Societal value created over 5 years.

 

The findings of this study show how internships create societal value and highlights three key areas which create value. It excludes other areas, such as health and crime, which might increase the total social value if they were relevant. In order to observe and include benefits for a wider variety of factors companies would need to focus more on intern candidates’ backgrounds. For example, a candidate from a more deprived area is statistically more likely to benefit from a placement. However, the ability to predict this depends on the willingness of the candidate to report on their personal circumstances.  While factors such as Savings to Stakeholders or Ecosystem Services are more difficult for internships to impact, the opportunity to create further social value in other areas could help to maximise the total value of internships.

There are, however, often barriers to maximising societal value, such as time or resource constraints that limit the amount of social value that internships can create. If a company was to consider a wider array of factors at the application stage, and were able invest the additional time and cost, then a larger benefit could be calculated and felt by the intern. It may, however, also be difficult to prioritise, since health and crime related factors are often very personal and private. Smaller changes could further promote societal value for interns. For example, encouragement of exercise, healthy diet and spending time outdoors as part of the placement programme could help to increase societal value through health factors.

In Summary

 

The findings of this analysis suggest that the internship at RealWorth generated high amounts of social value and had a lasting impact on the stakeholder. What is clear is the range and variety of positive outcomes that can be created from the time and effort put into becoming an intern. Getting the most from the experience involves work from both the intern and the employer as they both need to value the contribution each have towards benefitting the other.  The employer needs to ensure there is a welcoming environment and an adequate induction while the intern must ask questions and become fully involved in the process in order to learn. Getting feedback and taking opportunities made my internship at RealWorth a valuable learning experience and the effort made by the RealWorth team to welcomed, encouraged and challenged me and allowed for my confidence and work ability to grow.

There is, however, still potential for internship programmes to maximise their societal value further. This can be achieved by concentrating more specifically on the potential channels of societal value creation that an internship can open.

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