While penultimate-year internships are well established and often lead to a full-time job, first-year ones are much less common.
JP Morgan and Goldman Sachs are among the banks that offer them. They typically last up to two weeks and take place over the Easter break, by contrast with the 8- or 10-week summer internships offered by most banks to penultimate-year students.
This year Goldman Sachs offered two-week fixed income internships to a number of first-year students. Next year it plans to offer equities internships as well. Kara Considine, a graduate recruiter at the bank, said:
‘First year internships give us a chance to find and track talent early on. Students also have the opportunity to learn a lot more about the firm before they apply for summer internships or full time positions.’
JP Morgan launched a ‘Spring Week’ programme for first-year students in 2002. Next year, the bank expects to offer around 40 places.
Clare Witton, graduate marketing manager, said the Spring Week aims to provide a rounded introduction to investment banking. ‘Students will rotate across different areas of the bank and undergo a variety of different sorts of experience including formal presentations, work-shadowing, classroom presentations and interactive trading games.’
While first-year internships provide a glimpse of an investment bank, they remain far less important than penultimate-year internships in securing a full-time job.
In 2003 many banks cut the number of their penultimate-year interns, sometimes by as much as 30%. Next year, many say the numbers are likely be stable or to rise.
The banks hiring the most interns in Europe 2004 are likely to include: Morgan Stanley, with 130-plus interns, Deutsche Bank with 130-150, JP Morgan with 120 positions and Merrill Lynch, with over 100 positions.
At Citigroup and Merrill Lynch about 75% of 2003 graduate hires were formerly summer interns. At Goldman Sachs and Morgan Stanley, the figures were 60% and 68% respectively.
Internships were a less important route to full time employment at JP Morgan, where only 35% of graduate hires were drawn from the interns pool in 2003. However, Witton said this was likely to rise in future:
‘We are increasingly looking to summer interns to fill graduate positions. Internships provide undergraduates with a great way to discover whether JP Morgan is right for them, and we get to see what makes them tick and whether they are right for the bank.’
Summer internships at some banks are more likely to lead to job offers than at others. At HSBC, 90% of interns were offered a full time position in 2003. At Citigroup the figure was 75%.
However only 46% of Morgan Stanley’s interns received full time offers, while at Cazenove the conversion rate was even lower, at 20%.
A graduate recruiter at one European bank said the number of interns converted into full-time hires varied considerably from year to year: ‘Sometimes they’re all awful and no one gets a full-time job offer.’