Threat of a recession is looming, and tech companies are feeling the heat. The job market is at its most competitive in a long time and global instability is at unusual highs. However, difficult times are an opportunity to innovate and invest in your more strategic efforts. Therefore, directing resources towards strategic and cost-effective initiatives like an internship program could be the saving grace that keeps your talent pipeline alive.
If you have an internship program in place, this is your chance to double down and look for opportunities to expand it. If you don’t have one, now is the time to get it off the ground.
Here’s three reasons why.
Internships are cost-effective
It’s common knowledge that hiring new employees is expensive compared to promoting from within. When employees are fired or quit, losses add up and both productivity and company morale takes a hit. Gallup reports that U.S. businesses lose a trillion dollars annually to voluntary turnover, and each lost employee costs between 50% and 200% of their annual salary.
During the Great Resignation, the amount of turnover skyrocketed and is now top of mind for companies.
On the bright side, employees who begin their journey as interns at a company are more likely to stick around than those who never interned or did so elsewhere. That means less turnover and less cost. Plus, it reduces “mishires,” which makes a lot of sense: after an internship program test run, if both the individual and company want to continue the working relationship, it stands to reason that that person is a good fit for the company culture.
These programs are an important factor in increasing workforce diversity
Reaching out to the new generation of workers by offering internships also allows a company to take a more conscious effort to diversify its workforce. Recruiting underrepresented and marginalized populations that have had difficulties accessing these types of opportunities is a force for good in the world, and social impact is one of the top 5 values early career candidates are looking for in their place of work. Diversity strengthens an employee base through the introduction of people with a variety of backgrounds and viewpoints. This strength could be a significant competitive differentiator during a recession when any advantage is welcome.
Consider the factors you could implement in an internship program to make it accessible to as many people as possible. Offering partially or fully remote internships will open your doors to talent that lives anywhere in the country (or world) or that simply can’t manage the travel. Paying interns makes your program much more attractive and accessible; not everyone can afford to take months or a year off of a paying position to intern.
Make sure you have clear guidelines for your recruitment teams on your diversity and inclusion goals when hiring interns. And don’t let that commitment to diversity end once the program starts; offer seminars or resource groups to allow interns to share their unique backgrounds, reflect on their experiences in the program, and grow closer together.
Internship programs are forward-looking
Keep in mind that we won’t always be in a recession. When we bounce back, will your team be ready and have a strong pipeline of leaders and managers climbing the ranks? If you halt your internship program during a competitive labor market, your company could miss out on cultivating future leaders. 20% of baby boomers will retire in the next decade, and Gen Z workers will comprise over a quarter of the global workforce by 2025. Your internship program is critical to a healthy talent acquisition strategy; treat it as such and your organization can weather these workforce shifts and have a steady source of human capital to keep operations thriving.
The future will require young workers who understand the wants and needs of younger generations. The technology of work also changes rapidly, and not bringing in individuals with the latest digital skills will only put organizations behind.
The economy is unpredictable. But we are not powerless in a recession, and a well-managed internship program is an effective tool for mitigating the impact of economic downturns. This is particularly true for the talent pipeline and future workforce of a company. The cost-effectiveness of having interns that turn into full-time employees and stick around is a welcome, and rare, financial advantage in a recession. And finally, crafting a workforce from the intern level upward gives a company the ability to find and nurture the strongest talent available and invite diverse viewpoints that will help the company remain adaptable and flexible well into the future.