There are two myths I frequently confront regarding public relations consultancies. At year one, many of my students believe that working in PR must mean working in a PR consultancy (thus ignoring the majority of PR roles and work experience opportunities). Then, later, many still believe that to further their in-house career ambitions, they need a stint in a consultancy. The belief seems to be that all high-powered PR work goes on in consultancies, not in-house.
There are great niche consultancies serving specific sectors and there is some thought leadership amongst the international firms (this is a good example involving blogs). Julian Henry’s piece in Media Guardian a week ago sparked some response on this week’s letters page. But I would contend that the centre of gravity in the PR industry has moved in-house, and that consultancies are now at best a niche business. You may disagree.
PR Studies 
Surely two different points? I think you definitely have something with the “centre of gravity in the PR industry has moved in-house” but I’m not sure that I’d therefore conclude consultancy experience is less valuable. I think consultancy experience is still important in terms of the variety it offers both in terms of range of sectors you can cover as well as types of PR activity. It is harder to get this breadth in-house.
I can’t agree or disagree because I simply don’t have the experience to do so, but on a personal level, I think I would enjoy agency work over in-house. And although in-house is better paid (so I’ve been told) I think agency work is more exciting and diverse.
I also get the feeling that PR pros who work in agencies are more respected than in-house.
Ideally, it would be beneficial to work at both to further a career IMHO.
I think that the rise in popularity to do placements with agencies is that they are percieved as the more exciting ‘cut-and-thrust’ end of the PR working spectrum (if you will).
Students are afraid of limiting themselves through specialising too early on in their careers. Agencies I have worked for often have more than one ‘genre’ of public relations and an assortment of different clients. You have to admit that that sounds a little more exciting!
Your students should also remember that there are rewarding careers to be had in the public (civil?) service.
Not only do you become involved in the development and implementation of important public policy, the pay is pretty good and there’s always the opportunity to jump from ministry to ministry and from specialty to specialty if things get boring.
I have just started with an agency with a diverse range of clients having previously worked in-house in the voluntay sector (all in Yorkshire).
Agency so far is interesting, hard-work and has a purer PR workload…. but I have to admit that for sheer practical ‘hands-dirty’ experience and excitement in-house has the upperhand so far… but it is early days yet!