Intrigued, Moughan talked the idea over with his parents, who agreed to lend him the money. Within a few weeks, Intrax had set him up with a work visa and a summer internship in London at Electronic Shipping Solutions, an electronic documents service company for the shipping industry that was started by two MBA graduates from the University of Pennsylvania's Wharton School (Wharton Full-Time MBA Profile). The internship worked out better than Moughan, 24, could have hoped: He was hired as a project manager after his internship ended and he plans to continue working for the company when he returns to the U.S. this spring. "It was a smart move, career-wise," Moughan says. "The investment has really paid off."

With the entry-level job that new college graduates used to snap up increasingly hard to come by, those starting out now have to look farther afield for that first gig. Employers said they expected to hire 7% fewer college graduates in 2010 vs. the previous year, according to a survey conducted by the National Association of Colleges & Employers (NACE) last fall, and recruiting remains down on many college campuses this spring. For many students, that signals it is time for a different approach. Increasingly, a growing number of them are securing an internship abroad to gain some work experience and then coming back to the U.S. to launch their careers. Those just a few months out of school are heading everywhere from Israel to Germany, snapping up sought-after jobs in government, nonprofits, and high-tech companies.

Work-Abroad Trend

"There is no question that there are more students than ever before who have an interest in working abroad," says Manny Contomanolis, career services director at the Rochester Institute of Technology (Rochester Undergraduate Business Profile) and past president of the NACE. Students are seeking out these programs partly as a response to the tepid job market, but also because they increasingly realize the value that American companies place on global work experience, Contomanolis says. For many students, working abroad now is the next step, especially as they try to impress employers in an increasingly competitive job market. The total number of students traveling abroad for internships and receiving academic credit increased from nearly 7,000 in academic year 2000-01 to nearly 14,000 in 2007-08, according to the Institute of International Education (IIE), a New York-based nonprofit. That's a trend that "parallels the rise in study abroad by U.S. students generally," says Peggy Blumenthal, the IIE's chief operating officer.

Not surprisingly, organizations that specialize in work-abroad programs say they've seen a sharp increase in the number of college students and recent graduates looking for internships outside the U.S. Many of these groups require students to pay a fee of several thousand dollars to set them up with a job, while others award fellowships that help cover the cost of housing and living expenses. The programs that cost several thousand dollars usually set students up with housing, help them obtain visas, and pair them up with a business that aligns with the student's career goals. Paul Lakind, director of the Global Intern, a company in Randolph, N.J., that arranges internships in Israel, England, China, and Italy, compares the cost of his program to the equivalent of a three-credit course at a private university. "It is not for everyone and it is certainly an investment, but we don't want it any other way," he said. "People need to look at it in a very serious manner."

Parents and students must be careful when deciding whether to pay the large fees associated with these programs and make certain that the investment will pay off for the student in the long run, Contomanolis says. "I've spoken many a time about the trend of parents paying $10,000 for their kids to get an unpaid internship in the entertainment industry. I think that is appalling and blatantly playing on the fears of students and parents," he says. "But with the working-abroad program, the fees often cover immigration documents, visa-related items, housing, so people understand what they are paying for and can then do an analysis."

With so much demand, a small but growing number of companies that specialize in study-abroad programs are trying to capitalize on this new market by starting work-abroad programs. One of the newer programs is Intrax Internships Abroad, a division of the San Francisco-based Intrax Cultural Exchange. Launched last year, the Intrax internship program sets students like Moughan up with jobs in France, Germany, the United Kingdom, Japan, and soon China. So far, interest has been high, and applications have more than quadrupled this year, says Terry Cumes, the internship program's managing director. "We saw that the same students studying abroad wanted to find internships overseas," Cumes said. "Now when you look for a job, you can't say I've studied abroad for a year because everyone has done something like that."

Distinguishing Factor

Indeed, differentiating oneself in today's job market has been a motivating factor for students signing up for these programs. When Sarah Block graduated from Syracuse University (Syracuse Undergraduate Business Profile) in 2008, she knew she wanted professional experience abroad. She'd heard about a program called Masa Israel, an Israeli work-abroad program for recent college graduates, and applied for a spot. A few months later, she was working in the marketing department at Tel Aviv-based Radvision (RVSN), which develops video network infrastructure. When she returned to the U.S. five months later, she landed a job at Godfrey Q & Partners, a San Francisco advertising agency. Block, 23, is convinced that her experience abroad helped her to get that job interview and others. "If I started the job search right out of school, I would have been just another standard university student," Block said. "When I came back, employers and recruiters would specifically ask me about my experience in Israel. I think it gave me an edge."

Block is part of a growing demographic for Masa Israel, which has had more than 10,000 inquiries from recent graduates in the past 19 months, says Avi Rubel, Masa Israel's North American director. The group has arranged hundreds of internships for students in public health, finance, and human rights. There are 1,486 people participating in the program this year, a 51% increase from 2009, Rubel says. They typically pay about $3,000 for five months abroad.

Other programs that help students find internships in specific countries are also reporting similar increases. The DAAD- German Academic Exchange Service, which awards fellowships to students who want to study or work in Germany, saw a 30% increase in applications for the organization's InternXchange program and a 20% increase for internships at the Bundestag, Germany's national parliament, a spokesman said. Sally Hudson, 21, a senior at Bowdoin College in Brunswick, Me., is heading to Germany this fall to work at the parliament. A government and German major from Maryland, Hudson decided to delay her job search until she returns from Berlin in November, freshly minted with international experience.

"There's a sense among a lot of my friends that the economy will be pulling out of its worst point in a year or two," Hudson says. "I'm just hoping that I can hold my head above water until then."

Damast is a reporter for BusinessWeek.com.

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