In tech world, competition is fierce for internships...and interns

This is the time of year when college and graduate school students are trying to line up internships for the summer. In the tech world, competition is fierce, not just among students vying for internships, but for companies trying lure the best interns. 

"With about five spots open, we typically get 300-400 applicants," says Jerry Jao, the founder and CEO of Santa Monica-based start-up Retention Science, of his company's internship program.  The company helps businesses keep their online customers coming back.  

"When we extend an offer for a student to join us for an internship, the goal is to get to know them, give them real tasks, and at the end, if they finish their graduate work, we would love to hire them full time," Jao told KPCC. 

Most of the applicants, he said, are graduate students, and many already bring some real work experience. So he pays them competitively. He briefly considered offering unpaid internships but realized it's just not practical or good business in his industry. 

"In general, in tech, we’re not very comfortable with the idea of free labor," says Melanie Vaget, a senior manager at Factual, a location data company based in Century City.  "We're very sensitive to exploitation."

Vaget supervises her company's internship program.  She had to process about 150 applications for six internship slots.  But she says that's just one side of the competition.

"Every single intern that we hired this year had competing offers from other companies as well," Vaget told KPCC. "Often, when one company learns it's competing for the same intern, depending on what their resources are, they quickly move to up the compensation package."