hashlib.md5() TypeError: Unicode-objects must be encoded before hashing

I am new to coding and have ran into a problem trying to encode a string.

>>> import hashlib
>>> a = hashlib.md5()
>>> a.update('hi')
Traceback (most recent call last):
  File "<pyshell#22>", line 1, in <module>
    a.update('hi')
TypeError: Unicode-objects must be encoded before hashing
>>> a.digest()
b'\xd4\x1d\x8c\xd9\x8f\x00\xb2\x04\xe9\x80\t\x98\xec\xf8B~'

Is (a) now considered to be encoded?

Second question: When I run the same code above in a script I get this error:

import hashlib
a = hashlib.md5()
a.update('hi')
a.digest()

Traceback (most recent call last): File “C:/Users/User/Desktop/Logger/Encoding practice.py”, line 3, in a.update(‘hi’) TypeError: Unicode-objects must be encoded before hashing

Why is the code working in the shell and not the script? I am working with Windows and Python 3.4

Thanks.