Around 7000 graduates’ career prospects have been given a boost, now that over fifty universities have taken up the Government’s £13.6 million fund to provide internships in small businesses by the end of the year as part of the Backing Young Britain campaign to help young people into work.  

The graduate internship programme, which is being promoted by the Federation of Small Businesses, will support small businesses to take on – and get the best from – a graduate intern. Graduates will receive practical assistance before, during and after their internship, including mentoring, pre-employment and interview training, and CV workshops. 

The Prime Minister welcomed the partnership between the Federation of Small Businesses, the Government and universities across the country.  

The Prime Minister said:  

“We are committed to supporting young people as they develop in their careers, which is why we have invested over £13 million in new internships, and in the training and mentoring of people taking them up.  

“Almost seven thousand places are now being offered by universities across the country, and I am pleased to see so many universities working with the FSB and the Government to give seven thousand graduates this great opportunity and first taste of working life.  

“By Backing Young Britain and working with small businesses through these difficult times, we can help ensure that we secure sustainable economic growth for the future.”  

In England, more than 50 universities will support graduates and small businesses, as they provide a total of 6,998 internships by the end of this year, rising to 8,500 after that.  

Through the internship programme:  

  • Small businesses will:
    • Get financial support to take a graduate intern (around £1300 in wage subsidies on average)
    • Have access to a national, single point of contact for advice in getting a graduate intern
    • Get access to new skills and fresh talent to help build your business.


  • Graduates will:
    • Benefit from more than just the internship.  They’ll get other structured support before, during and after their placement – including mentoring, pre-employment and interview training, and CV workshops.
    • Get the opportunity to see make a real difference in a small business – a great experience for budding entrepreneurs.


Business Secretary Lord Mandelson, speaking at a reception in Downing Street to celebrate the success of the UK’s small businesses, said:  

“The fact that this scheme has become so successful speaks volumes for the hard work and dedication of UK businesses, who are putting their faith in the workers of tomorrow.  

“We need skilled people of all ages to hit the ground running when they begin work, and these internships give them the perfect base from which to start. There is still over £2 million available, and I would encourage all universities to become involved.”   

Interns under this scheme will be placed with small business and businesses in the Government’s priority areas, which were set out in ‘Building Britain’s Future – New Industry, New Jobs’.  

They are:  

  • low-carbon products and services
  • digital industry
  • life sciences and pharmaceuticals
  • advanced manufacturing
  • professional and financial services
  • engineering construction
  • industrial opportunities presented by the ageing society.


HEFCE has been working closely with Higher Education Regional Associations, Regional Development Agencies and the Federation of Small Businesses to implement the scheme. Universities will be working closely with these organisations, as well as other employer representatives, to promote graduate internships to business.  

HEFCE Chief Executive Alan Langlands said:  

”Universities have responded enthusiastically with a wide range of practical and flexible proposals to help graduates towards employment through the internships scheme. This will make a significant difference for businesses, particularly those who are taking on a graduate for the first time.’  

John Wright, National Chairman, Federation of Small Businesses, said:  

‘We have seen encouraging signs that unemployment is beginning to fall, but youth unemployment is still at a record high and small businesses are stepping forward as the key to tackling this challenge. Research by the Federation of Small Businesses shows that one in five small firms say they are keen to take on graduate interns.’Graduates on placements in small firms will be able to gain invaluable work experience and develop real skills at a time when the job market is sluggish at best, and small businesses will benefit from the skills of this trained and available workforce. Research shows that one in four graduates are offered full time employment in the business at the end of the placement, so graduate internships are a win-win for both the business and graduate and any support small firms can get to put them in place is very welcome.’  

An additional £2.4 million is still available for universities to support additional internships if they exceed their initial allocations, and for interested universities that are not yet involved in the scheme.  

500 of the 8,500 graduate internship places will be ring fenced to pilot undergraduate internships in summer 2010, with the aim of supporting wider access to the professions.   

 Background Briefing  

  1. £13.6 million is available for internships, of which £11million has now been allocated.
  2.  The allocation of internships is set out in the attached spreadsheet.
  3. The Downing Street Reception celebrated the resilience and success of the UK’s SMEs. In response to the recent recession, the Government introduced a range of measures to help businesses through difficult times, and we are continuing to provide support during the recovery and help enable small and medium sized businesses to flourish. These include securing lending commitments of £27bn from RBS and Lloyds and helping over 160,000 businesses spread payments of more than £4.7bn in businesses taxes.
  4. The Federation of Small Businesses proposed a graduate intern scheme centred on small businesses, and have worked with HEFCE, universities and regional partners to discuss how the scheme will work locally. They are actively promoting the scheme to members, although it is open to other employers across the country as well. 
  5. Universities will work with the FSB and small businesses to tackle priority areas such as low carbon and digital.  For example:
  •   “Project Green” at Keele University combines a post graduate module in Greening business with an internship.
  • At Plymouth, graduates will be able to access an advanced level skills programme at the same time as helping businesses with marketing, research and design
  •  In Yorkshire & Humber, all 11 universities are working together to pool their strengths – delivering the maximum amount of graduate internships possible to help boost the regional economy.

      6.   For more information on the scheme, please use the FSB helpline number: 0845 072 7597 (Monday-Friday, 9.30am to 4.30pm), visit the website  ( or email: [email protected]