NEW YORK (Fortune) -- Dear Annie: Please settle an argument. I'm a junior in college, studying engineering, and I have two choices for what to do this summer. One is, I could wait tables at the same upscale restaurant where I worked last year, and earn enough tips to pay my tuition for my entire senior year.
The other option is, I've been offered an internship at a local engineering partnership, which would probably be great experience and look good on a resume, but it pays nada. I don't want to graduate with a pile of debt, so I'm inclined to take the restaurant job, but my dad says I'm thinking too short-term and that the internship would be a much smarter move. Who is right? --The Catalina Kid
Dear C.K.: Well, that depends. Do you know exactly what you would be doing at the engineering firm? That is, would you be actively involved in projects, meeting clients, shadowing the partners as they go about their work, and so on? In other words, would you be learning real-world stuff, or mostly doing menial tasks like fetching the partners' coffee and picking up their dry cleaning?
Also, can you find out whether this firm has hired past interns for full-time positions after graduation, or at least helped them find good jobs elsewhere -- or would this be strictly a three-month stint with no follow-up next spring?
You no doubt see where I'm going with this: If the internship is likely to be three months of unpaid scutwork with no reward later on, then get ready to put on your waiter's apron. If, on the other hand, the engineering gig will lead to a real job offer (assuming the partners like the cut of your jib), then heed your dad's advice and grab it.
You're lucky to have a choice. Competition for internships is more ferocious than ever this year, partly because many companies are bringing fewer interns on board than in past years, and partly because some programs have been opened up to college grads and even to seasoned workers who are using internships (yes, including unpaid ones) as a way of launching new careers.
Winter is prime campus-recruiting season for summer interns, and one resource that may help internship-hunters refine their search is the 2010 edition of the "Vault Guide to Top Internships," downloadable for $14.95 at career site Vault.com. It's a detailed directory of 785 programs, including descriptions of the type of work available, contact information, application deadlines, and tips on getting hired.
Vault's researchers came up with a list of the Top 10 programs in U.S. business overall, based on a combination of factors, among them pay, housing assistance, and the chance to work on real projects.
On that list are giants like General Electric (GE, Fortune 500), Google (GOOG, Fortune 500), KPMG, and J.P. Morgan's investment banking division. Vault also compiled separate Top 10 rankings for finance (Boston Consulting Group, Goldman Sachs (GS, Fortune 500), PricewaterhouseCoopers and Morgan Stanley (MS, Fortune 500) made the cut) and for internships in creative businesses and the arts (a group that includes the Kennedy Center, Liz Claiborne (LIZ), and the New York Times (NYT)).
Ideally, internships give employers a chance to make a realistic evaluation of potential full-time hires, and vice versa. Says Holly Paul, who heads up recruiting for PricewaterhouseCoopers: "We've worked hard over the past two years to create a program that gives interns a wide variety of experiences so we can clearly see how they will perform -- and to show them enough of what we do so that they can decide whether we're the right place for them, too."
The firm is bringing in about 2,000 interns this year, down 5% from 2009. Many of them will get job offers after they graduate: 70% of all new full-time PwC hires start out as interns.
The top programs are flooded with so many applicants that it's no disgrace not to get in. "Not everybody is going to get a Top 10 internship," notes Vault executive vice president Yazad Dalal. "But everybody should try to find one that he or she is extremely interested in, or even passionate about."
Why? Because whatever you do as an intern could well lead straight to your future career, which could last decades. "Pick a field you could see yourself enjoying not just for this summer, but for a long time to come," he advises. "It's a practical approach. If you are not passionate about your work, you probably won't be very good at it over the long haul." True.