To fix its workforce problems, Virginia needs more internships, but they’re falling nationally

The Brookings Institution recently released a report on the state of the Washington-area economy in light of President Donald Trump’s downsizing of the federal government. Given that the Northern Virginia portion of the Washington market accounts for 42% of Virginia’s general fund tax revenues, and that those tax revenues help subsidize rural school systems across the state (and some urban ones), this is a question as important in Lee County as it is in Loudoun County.

The headlines out of that report were typically about rising unemployment rates or slowing economic growth in the region — all of which ought to be worrisome, but none of which should be surprising under the circumstances.

Further down in the report, though, was a figure that caused eyebrows to rise in some business suites around the state: Brookings reported that over the past year, the number of internships posted in the Washington market has fallen by 36%.

Why are we worried about a bunch of college kids when the economy of the state’s single biggest revenue generator seems at risk? The answer: because there’s an important overlap between these two things.

When Glenn Youngkin ran for governor four years ago, he warned that more people were moving out of Virginia than moving in. Virginia was still gaining population because births were outnumbering both deaths and the net out-migration. Imagine a bathtub where the water level is rising slowly, but beneath the surface, there’s a huge leak.

That “leakage” began with Virginians 65 and older, who appeared to be retiring and moving to warm climes from South Carolina to Florida. In time, Virginia saw outflows among all age cohorts. Most worrisome from an economic standpoint, Virginia now sees 37.6% of its college graduates leave the state within a year of graduation, according to the U.S. Census Bureau; 45% leave within five years. In some fields — such as mathematics — nearly half are gone within a year. Virginia is educating a lot of workers for other states.

This prompted a search for ways to keep more of Virginia’s graduates at home. The main way — pushed by the Virginia Business Higher Education Council, a private group of business leaders who see the nexus between education and the economy — is to promote more internships. The theory is that if more students have internships, they’ll not only be better prepared for the workforce, they may be better connected to local companies, who might hire them and keep them in-state. 

The best example that supports this approach is Philadelphia. In the early 2000s, the city was exporting college graduates, the classic “brain drain.” The city’s business leaders responded by making a concerted push to promote internships, along with other things intended to jazz up the city’s “cool” factor. The result, according to the technology news website Technical.ly, is that Philadelphia now imports college graduates — and that’s powered its economic rise. “Between 2000 and 2017, Philadelphia city’s population of bachelor’s degree-holding 25-to-34-year-olds surged by 115%, eclipsed only by Washington D.C. — and beating places like Seattle, Boston, Los Angeles, New York and San Francisco,” the report says. Now, “of the 10 regions that attract the most venture capital in the country, Philadelphia’s share grew the second fastest between 2013 and 2023.” As recently as 2020, Philadelphia didn’t even make the list of the world’s 40 best places for tech startups, according to StartUp Genome, a group that tracks such things. Now, in this year’s ratings, it’s No. 13. (See my previous column on what Virginia can learn from Philadelphia.)

The Business Higher Education Council (led by former House Speaker Kirk Cox, a former high school teacher) has pushed for Virginia to set a goal of each college student having at least one internship before they graduate. The current state budget includes $26.5 million to launch programs to set that in motion, including money to provide stipends for some students to cover housing and transportation costs and to help small businesses cover some costs. Virginia is the only state to set a goal that every college student has at least one internship before graduation, the council says.

While 100% is a lofty goal for anything, some Virginia schools do post high numbers of students with internships. Gallup says the national average for college students with internships is 41%. While there appears to be no central clearinghouse for state numbers, it’s clear that some schools do much better than that national average. Two years ago, Virginia Tech was at 55%. James Madison University says its current figure is 79.3%.

All that sounds like a solid, businesslike way to address the problem.

That’s why the 36% drop in internships in the Washington market sets off such alarm bells — that’s the opposite of what the business community across Virginia wants to see happening.

It turns out there’s more to this drop than just the federal cutbacks. While the decrease in internships in the Washington market is steeper than elsewhere, and no doubt tied to a unique situation with the federal cutbacks, we’re also seeing a decrease in internships nationwide.

Brookings said that posted internships nationally were down 17.5% from June 2024 to June 2025. Other groups report different numbers, but the same trend. 

Higher Education Today reported earlier this year that internships were down the most in the highest-paying fields (highest-paying after graduation, not necessarily during internships). Technology postings had fallen 30% over two years, professional services internships 42%. 

Why is this? 

There’s no clear answer, other than an economy that is changing in some fundamental ways. Fast Company says, “between the Trump administration’s cuts to university funding, and economic uncertainty over tariffs, many companies are tightening their hiring budgets, limiting the number of summer internships they offer, and raising the amount of experience they require.”

Adweek says that in the marketing world, internships are down because of “companies’ increasing push to diminish labor costs through layoffs, consolidation, and artificial intelligence. Because of that, companies are less likely to invest in early-career employees, according to analysts.”

There are also demographic pressures: Because of declining birth rates over the years, there are fewer workers entering the labor pool. Many companies are adjusting to that by moving to automation — robots in manufacturing fields, artificial intelligence in office settings. Both Adweek and Fast Company agree: With fewer entry-level jobs available, there’s less need for companies to groom potential employees through internships. 

How will these national trends that are producing fewer internships intersect with Virginia’s goal to create more? This is one of many issues that our new governor will find waiting on her desk, although if she has the time and inclination, she can read up on it now.

On Wednesday, the Virginia Business Higher Education Council releases an 11-page proposal for how the state can retain and attract more talent. (I feel compelled to point out that the length and specificity of this document exceeds what we’ve seen from the candidates for governor.) Not surprisingly, it calls for more state investment in higher education — for economic development purposes. 

Virginia appears to have a growing disconnect between the talent it produces through its college system and the talent it retains through the marketplace. CNBC’s famous (and winners would say prestigious) Top States for Business ratings are somewhat subjective in how they weight certain categories, but those categories are based on actual, hard metrics. In 2019, Virginia ranked No. 1 in education and No. 1 in workforce — and eventually scored No. 1 overall. This year, Virginia still ranked No. 1 in education but fell to No. 14 in workforce (which helped pull the state down to No. 4 overall). I wrote earlier about how those ratings are put together; we may want to discount the overall score, but the rankings within categories may be more important. 

Much of the proposal that the council will be talking up between now and the next General Assembly session is based on ramping up state support for internships even more. “We’re just trying to make people aware of what a game changer this is,” Cox said. “I’m not sure we’re going to ask for a lot more money. What would really help more than anything would be recognition that this is a game-changer — it’s getting businesses that don’t have an HR department to say ‘hey, we can do this.’ I think you could triple the amount of small business.”

This may have already been important, but what’s happening right now in Northern Virginia — and nationally — seems to draw a bright red line under it.