Mindi Thompson still remembers the student who worked two unpaid internships while juggling classes and a part-time job, only to graduate with no job offer. "That story isn't rare," says Thompson, a professor at UW–Madison. "But our data shows it doesn't have to be that way." A national study she co-led reveals that paid internships are one of the strongest predictors of success for college grads—especially when it comes to pay and career fit.
The research, which followed over 26,000 students who earned bachelor's degrees in 2016, found that those who completed paid internships earned significantly more just a few years after graduation. One year out, they made $5,564 more on average than peers without such experience. By year four, that gap grew to $9,089. These aren't small bumps—they're life-changing sums for young adults building careers.
What makes this study stand out is how carefully it was designed. The team used federal education data and matched students with similar backgrounds—same GPA, field of study, family income, and more—to make sure the results weren’t just showing that high-achievers get better jobs. Even after accounting for all those factors, the advantage of a paid internship remained clear. Graduates were also more likely to land jobs that required a college degree and that felt like real career steps, not just stopgaps.
Other types of work experience didn’t deliver the same payoff. Unpaid internships, co-ops, practica, and federal work-study jobs showed no boost in earnings. Some, like unpaid internships and practica, helped students find degree-related jobs, but not higher pay. That raises tough questions about fairness, especially since Black, Hispanic, American Indian, and Native Hawaiian students were more likely to hold unpaid roles.
Why do paid internships make such a difference? The researchers tested several ideas. Did they build skills? Expand networks? Or did they simply signal readiness to employers? The strongest evidence pointed to that last idea—what experts call "symbolic capital." In short, a paid internship tells employers: this person has been vetted, they’re professional, they’re ready to work.
"These findings show that paid internships are not just nice to have—they meaningfully shape graduates' early career trajectories," Thompson says. With such clear benefits, the study makes a powerful case for colleges, companies, and policymakers to expand access—especially for students from underrepresented and lower-income backgrounds. The goal isn’t just better resumes. It’s fairer starts.