Lawmakers are hoping a new bill giving tax credits to companies that hire college interns will stop Missouri’s brain drain.
There is no lack of qualified individuals in the state, says Jason Hall, CEO of Greater St. Louis Inc., a nonprofit composed of businesses and civic organizations created to spur economic development. “Missouri colleges and universities build a strong pipeline for undergraduate talent,” Hall says. “But our team found that we are exporting twenty thousand of those college graduates to other states, and that is unacceptable.”
Earlier this year, Governor Mike Parson signed a bill focused on creating job opportunities for young people and businesses alike. The Intern and Apprentice Recruitment Act is a tax credit program incentivizing companies to hire more paid interns and apprentices in an effort to stop the effect known as brain drain. The act offers companies a $1,500 tax credit for each paid intern or paid apprentices up to $9,000, or six positions, and is set to start Jan. 1, 2024.
However, the tax credits are not available for just any company to use on any intern. The credits will only apply to newly created positions, not internships already existing, in order to increase the number of internships available across the state. The bill also notes that an employer cannot claim the tax credit if the intern or apprentice is being paid less than minimum wage.
State Rep. Brad Christ, a Republican who represents parts of St. Louis, says, “If you hire on average ten interns a year, now you have to hire eleven, twelve, thirteen, up to sixteen to take advantage of the tax incentive.”
Historically, Missouri has had fewer internships available compared to other states, Hall says. Lawmakers and job advocates are hoping this tax break will encourage companies to create more positions and stem the post-grad migration.
Internships have become crucial to companies’ growth considering many businesses end up offering part-time or full-time positions to their interns afterwards. Kathy Mazzarella, president and CEO of Graybar, an electric supply company in St. Louis, has witnessed this firsthand. “Our interns not only gained valuable experience through [our internship] program, many of them have chosen to stay with our company after graduation,” she says.
Industries such as agriculture technology and geospatial and advanced manufacturing are becoming increasingly important sectors of the state’s economy. “We need to fill these high-quality jobs and careers,” Hall says. “Retaining and attracting talent is just critical.”
Governor Parson believes that if people want to pursue careers close to home, they should not be marred from that choice by a lack of opportunity. “There’s no reason in any category they can’t work right here in Missouri,” he says.
Lawmakers hope that this program will not only create opportunities and retain young talent but also help protect the future of the state’s most vital industries.
Parson believes the bill emphasizes the state’s commitment to opportunity and prosperity for young talent. “Missouri is committed to growing and developing a workforce that is prepared to meet the demands of the future,” he says.