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The Almighty Buck Technology IT

Interns At Tech Companies Are Better Paid Than Most American Workers (qz.com) 158

Posted by msmash from the something-worth-pondering dept.
According to a survey conducted by Jesse Collins, a senior at Purdue University and former Yelp intern, interns at tech companies make much more money on an annualized basis than workers in the vast majority of other occupations. From a report on Quartz: About 300 of the nearly 600 people who responded to the survey said they had received internship offers from big companies like Facebook, Twitter, Yelp, and Goldman Sachs for 2017. On average, the internship recipients said they would be paid $6,500 per month, the equivalent of $78,000 per year (the survey is still open, so results may change). Many also said they would receive more than $1,000 worth of stipends per month for housing and travel or signing bonuses. Internships typically run for a summer, but we've annualized the numbers. If the average intern who responded to Collins' survey were to work for a year, he would make $30,000 more than the average annual income for all occupations in the U.S., which is $48,000. Of the 1,088 occupation categories within which the Bureau of Labor Statistics tracks average income, workers in only about 200 of them on average make more money in a year than the intern would.
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Interns At Tech Companies Are Better Paid Than Most American Workers More

Interns At Tech Companies Are Better Paid Than Most American Workers

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  • Social Media overvalued (Score:1)

    by Anonymous Coward

    Film at 11

  • news flash - income varies by region (Score:2, Insightful)

    by Anonymous Coward

    A salary that is comfy in Kansas will have you sleeping in a van in Silicon Valley.

    • Re:news flash - income varies by region (Score:5, Insightful)

      by OrangeTide ( 124937 ) on Monday December 05, 2016 @03:26PM (#53427299) Homepage Journal

      Most interns split the rent 3-5 ways. It's hard to find a rental for such a short term, and the rates tend to be pretty astronomical. Splitting a $6000/mo(+/- $1000) 4-bed/2-bath townhouse four ways is a practical way to go. But the $40/hr that an engineering intern might make in SV dries up pretty fast with rent, food and taxes.

      I've lived in a decent 1-bed apartment in silicon valley (san jose) for $1200/mo. There were laundry facilities and a swimming pool and it was only a 1 mile walk to a light rail stop. It was month-to-month, no lease, but I was a long time resident and I doubt an intern that had no credit and only wanted to stick around for 3 months would get the same deal.

      • I live in a 2700 sqft house just 10 minutes from work and pay $500/month. Also own 5 acres overlooking a large lake for $200/month. I'm a 2 hour flight from and in the same time zone as Silicon Valley yet they have no interest in opening up jobs here despite the low cost yet high engineering and science skill (I have 3 degrees).

        • I live in a 1200 sqft house 15 minutes from work in the heart of Silicon Valley, and pay $3500/mo for the mortgage. I have a small lot (not much to mow at least) and a view of the hills and observatory. But if I ever leave my job there are 10 more waiting for me because I live in the Bay Area.
          It is easier to get promotions at my company for people who are on site versus those who telecommute. But other than that small factor, telecommuting is a very good deal.

        • Re: (Score:2)

          by Hodr ( 219920 )

          You miss the primary advantage. I can grind away for 20 years in the Bay Area (1/2 way there already) and RETIRE AT 45 to live like a king in your area.

      • Most interns split the rent 3-5 ways. It's hard to find a rental for such a short term

        It is common for Valley tech companies to rent a big house and make the rooms available either free or at a discount to summer interns.

        • I'd say about a third of the big companies do that. (very rough guess)
          There are definitely several companies here that do not do that.

    • A salary that is comfy in Kansas will have you sleeping in a van in Silicon Valley.

      Not quite. I live in Silicon Valley and rent a studio apartment. Depending on how much IT contract work I do in a year, I make $30K to $50K. Silicon Valley can get very expensive in a hurry if you want a big house, big cars, big women and big kids. A modest lifestyle is doable in Silicon Valley if you don't mind your coworkers thinking that you're poor.

      • ..., big women and big kids.

        The SF Bay Area doesn't have many big women or big kids. It has one of the lowest obesity rates in America. If you go to a restaurant, even the chefs are skinny.

    • Re: (Score:1)

      by thomn8r ( 635504 )
      You were lucky to have a VAN! We used to have to live in a corridor!

  • Students are income tax exempt, too.

    But it's an error to project an intern's monthly pay over the entire year. The amount they earn is for a small number of months, and has to last them the remaining 9 or 10 until the next time they can intern.

    • Re:Students are income tax exempt, too (Score:5, Informative)

      by Anonymous Coward on Monday December 05, 2016 @03:18PM (#53427229)

      Students are income tax exempt, too.

      Bullshit. https://www.irs.gov/help-resou... [irs.gov]

      • I do remember claiming an exempt status on my taxes one year because I was a full time student and had no income. It was right on the 1040 form which is how I knew to claim it...

        If that was wrong, I have never heard about it from the IRS...

        • Re:Students are income tax exempt, too (Score:4, Informative)

          by nitehawk214 ( 222219 ) on Monday December 05, 2016 @04:08PM (#53427641)

          The income tax exemption is when you make under a certain amount after dependents adjustments.

          And if you actually had no income at all, why would you think you would have to pay any taxes at all?

          • I think the US system is different, but in the UK you don't pay tax on the first part of your income and a student stipend is non-taxable. This means that you can live very comfortably as a PhD student: the stipend covers your cost of living and then you can earn roughly as much as someone working a full-time minimum-wage job on top of that before you start paying taxes. When I did mine, I was coming close to the tax-free allowance from consulting work, so at the end of it I'd saved enough for a deposit o

            • Re: (Score:2)

              by Jaime2 ( 824950 )

              In the US, low income citizens pay negative tax. We call it Earned Income Tax Credit [wikipedia.org]. If you live alone and make no money (and therefore pay no income taxes), you get back a few hundred at tax return time. If you have kids, you get several thousand.

              Also, the first ten thousand or so of income is non-taxable. Combined with the Earned Income Tax Credit, families with children usually don't pay taxes on the first twenty to thirty thousand dollars of income. 45 percent of the US pays no federal income tax.

              • In the US, if you actually work for a living, you get hit by FICA taxes. Income taxes are generally the most progressive out there, so it's disingenuous to look at them alone.

                • Re: (Score:2)

                  by Jaime2 ( 824950 )

                  Because of EITC, the negative federal tax rate offsets FICA for incomes under $10,000. So, even factoring in FICA, most students pay no net income tax.

      • During my first tour through college, I typically worked 30 hours per week at the college bookstore. I probably made no more than $10K per year and paid zero in income taxes. Mostly because the county never took out taxes from the monthly paycheck (a huge problem for the regular staff as they needed to sit aside money for taxes) and the amount fell below the threshold for taxable income.

    • Re:Students are income tax exempt, too (Score:4, Informative)

      by DRJlaw ( 946416 ) on Monday December 05, 2016 @03:34PM (#53427379)

      Students are income tax exempt, too.

      So, very, very wrong. [irs.gov]

      Internship income is earned income as surely as work income is earned income. You may be confusing this alleged student exemption with an exemption for dependents who earn less than the amount of the standard deduction in a year [irs.gov] (currently $6300). Which these interns would blow past in the first month.

    • But it's an error to project an intern's monthly pay over the entire year. The amount they earn is for a small number of months, and has to last them the remaining 9 or 10 until the next time they can intern.

      Where did you get this? Intern money is not designed to support someone for the entire year. It's designed to give them a little bit of experience and maybe a little bit of pocket change. Some interns don't even get paid. They are not paying you more because it's only a short time. Projecting it over a full year seems perfectly reasonable. Also, how many people actually do more than one intern? Most people I know do one their Junior year and that was it.

      • I think he might be mixing up the fact that most internships often make below the income threshold for taxes. I had a paid internship for all 6 years I spent in college. It was basically full time over the summer and 15-20 hours a week during the semester. I'd have to look through my tax forms to be sure, but from memory even earning something like 14-16k/year I was basically paying very little to nothing in income tax.

      • Some interns don't even get paid.

        In America, unpaid internships are illegal.

    • Excuse me, but what planet are you on? I cannot speak for outside of the US, but this is a US centric article I assure you I paid taxes whilst I was a student

  • Why should this be surprising? (Score:5, Informative)

    by dlleigh ( 313922 ) on Monday December 05, 2016 @03:12PM (#53427163)

    Many of these tech companies are located in areas that have a very high cost of living, so it's unfair to compare their intern salaries with average workers in the rest of the country. Also, many of these interns are either in high-demand programs at prestigious universities or already have degrees from them, and are doing actual productive work. They are not spending their time fetching coffee or shadowing real employees.

    In my experience, technical internship programs are a good deal for both the company and the intern. They provide competent labor at a good price for the company and give students excellent opportunities for learning and growth.

    • When has an intern done any actual productive work? Every place I worked, the interns were always assigned the most menial, busywork tasks that we could come up with.

      • Re:Why should this be surprising? (Score:4, Insightful)

        by Anonymous Coward on Monday December 05, 2016 @03:22PM (#53427257)

        Then every place you've worked made poor use of its interns.

        • Re:Why should this be surprising? (Score:4, Interesting)

          by ShanghaiBill ( 739463 ) on Monday December 05, 2016 @08:08PM (#53429289)

          Then every place you've worked made poor use of its interns.

          Indeed. An internship is an extended job interview. You need to give interns challenging and interesting work, both to test their abilities, and to make them want to accept your job offer when they graduate.

          My company makes job offers to about half of our former interns during their senior year in college, and about 70% of those accept. We rarely hire any other graduating techs.

          • The estimate that I've heard from a number of companies is that it costs around $20-30K to hire someone competent. Internships are consistently listed as their highest return-on-investment recruitment method.

      • Re: (Score:1)

        by PIBM ( 588930 )

        That's so sad, getting the most out of them is what keeps the good one coming back, and telling their friends about your place, plus that's the best you can do for your business too. Oh well, to each its own!

      • Re: (Score:2)

        by garcia ( 6573 )

        I work for a Marketing Analytics firm. Our interns do real work so we can gauge their effectiveness should we offer them a full time position.

        Honestly, I haven't seen worthless interns anywhere in the last decade; perhaps this is due to the economic climate through those years?

      • Re: (Score:2)

        by Kjella ( 173770 )

        When has an intern done any actual productive work? Every place I worked, the interns were always assigned the most menial, busywork tasks that we could come up with.

        a) The companies you've worked for pay interns peanuts so you get monkeys
        b) The companies you've worked for have already decided they're no good and not to be hired
        c) The companies you've worked for are too stupid to give them a chance to prove themselves
        d) The companies you've worked for are overworked and needed a steam valve
        e) The companies you've worked for are testing their ability to suck it up and endure
        f) All of the above

        Even if they're serious students you can end up with a lot of strange things fr

      • The last place I worked, interns did menial tasks. Mostly tasks that needed to be done, though.

        At my current employer, at least on my team, interns are considered in-training for the full time position we'll offer when they are about to graduate. That has worked very well. It avoids wasting several months training and weeding out full-time hires at full-time pay.

      • I did., In fact I did more real work as an intern than I did as a full time engineer at a company that I interned with. I couldn't sign off on designs, but I could give them to other engineers that could.
      • Why would you bother with interns at all if this is how you treat them? Internships are a (comparatively) cheap way of hiring. You get three months to judge how competent someone is, how well they work with the team, how quickly they pick up your workflow, and so on. At the end, you can make a far more informed decision about whether to offer them a job than in a one-day interview. If you're not taking advantage of this, then you're just wasting a load of money and you'd be better off dropping the whole

        • Why would you bother with interns at all if this is how you treat them?

          You don't have to go through the whole hiring process to come up with a fully qualified employee that you want to hang around long-term. It's not as productive, but it's still productive.

          • The problem with that idea is that internships are a two-way interview. You're judging the candidate, but they're also judging you as a place to work. If you give them a crappy experience and they still come and work for you then that tells you that they couldn't get a job anywhere else. Probably not the candidates that you actually want to hire.
    • tech internships are an end run around visa limitations, and that would explain the pay disparity more than anything else. I keep seeing this patter. The company brings in somebody from India on a student visa for an Internship. The "student" already knows how to do the job. There's no training involved, which is the point. The company gets a worker that needs zero training.

      Back in my day before the visa programs we used to call people who did useful work 'employees' and they were paid as such...

      • Re: (Score:2)

        by markus ( 2264 )

        While transitioning from a J1 internship visa to an H1B employment visa is not entirely unusual, it also isn't a particularly useful strategy for the particular example that you are citing. J1 visas are limited to at most 18 months. They are only available for recent graduates or for students who are still in school. For many countries (including India), the visa holder must return to their home country for at least one year after the end of their internship program. Even if this restriction doesn't apply,

  • Read this closely (Score:3)

    by tietokone-olmi ( 26595 ) on Monday December 05, 2016 @03:15PM (#53427199)

    "On an annualized basis", meaning that the number of hours worked, or earnings per hour, doesn't figure in.

    Also cost of living in SV etc., which ought to be controlled for but isn't.

  • So... if you look at an internship that lasts 3 months and pays ~20,000 dollars, and multiply that by 4 regardless of the fact that the internship cannot actually be extended to be a year long, then in that hypothetical world (where nobody else's salary was also multiplied by 4, only the interns), interns would make $78,000 per year, and would therefore be making more than a lot of other people. But in the real world, where we all actually live, that person made a little less than $20,000 and is at the sam

  • This must be in California, where supposedly you only need a laptop and a ponytail to get $100K. The rest of the world, you won't get $75K until you well into your IT career.

  • Try to find a 1BR place and do deposit, first, last rent on that.

    Ha!

    That's not even middle class.

  • When I accepted an QA internship for $10 per hour in 1997, I doubled my income from the minimum-wage restaurant job that I had for three years after college.
  • As an engineering intern, I was paid more than friends that had already graduated college with other degrees (business/marketing/etc). If you took my hourly rate and ran it for a year, yeah it would have been in the 50K-60K range. Cost of living wasn't an issue. You could have all housing provided for you and have 3 roommates, or take a lump housing stipend at the beginning. The money I made and saved helped support me throughout the rest of the school year. And this WASN'T California.

    The unfortunate tr

  • Umm, these internships are super elite (Score:1)

    by Anonymous Coward

    These internships are super elite so why is this surprising? Most techies are not starting out at Goldman or Google or Facebook or Twitter or even a Yelp. Getting a job at one of these place is like getting into Harvard or winning the lottery both in terms of difficulty and in terms of how it sets you up for the rest of your career. I went to a top 50 US university but no top 10 or 20. I graduated and got an internships at JPMorgan. I ended up doing 4 years at JPMorgan. That job, the ridiculously good pay,

    • Getting a job at one of these place is like getting into Harvard or winning the lottery both in terms of difficulty and in terms of how it sets you up for the rest of your career.

      The easiest way to get a job at Google is to get a contract support position. I never went to high school and only had a pair of associate degrees to my name when I worked at Google in help desk and data centers. Except for the roasted duck and mac-and-cheese on Fridays, Google was no different than any other Fortune 500 company I worked for.

      • That and janitorial work is the easiest way to get a job at any place that does software tbh. It gets you in contact with all kinds of people within the company, and it's also pretty easy to stand out among your peers if we're talking entry-level helpdesk kind of stuff. Even if there's no direct and published path for getting from some kind of contract IT support to a full time developer position, you can still be among the first to know when there are job openings. Plus it's a lot easier to tailor a resume

  • Also bear in mind that that "average of all occupations" figure they give there is the mean. The median is around half of that. Meaning more than half of all Americans are making $50-something thousand a year less than these interns are.

  • So are full-time employees at tech companies (Score:3)

    by radarskiy ( 2874255 ) on Monday December 05, 2016 @06:18PM (#53428641)

    At any decent engineering firm, interns are doing real work that is worth real pay so it is unsurprising that at companies where the full-time employees make a lot of money the interns make a lot too.

  • Forget about being a tech intern; a $150/hr escort makes an annualized $312,000 per year!
  • What they do is find candidates graduating, from SMALL colleges, or schools that are not located in the New York, San Fran, Seattle areas. You know...flyover country. What sounds like a LOT of money for someone from the midwest, ISN'T really a lot of money, when you factor in what it costs in some of those cities to live. The rent for a tiny studio apartment in those cities, will rent you a VERY nice size 3-4 bedroom house out here in the midwest. Plus, the cost of auto insurance, food, travel etc are m
  • He should become a highschool drama teacher with the Halifax Regional School Board and cash $91,970 (Canadian)/year... and that's just ranked 278th, so there are 277 better-paid jobs on the Halifax Regional School Board's payroll.

  • this is pretty funny: "Intern Exploited for 35 years - CBC" - http://www.cbc.ca/player/play/... [www.cbc.ca]

    "This is that" is a satire news radio show for those who don't pick up on it when listening.

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