Are Unpaid Internships Hurting American Economic Mobility?
We’ve all heard the rags-to-riches success stories. The child of a single mother grows up to become president of a Fortune 500 company. A visionary with a dream manages to overcome a background riddled with drugs and crime, skyrocketing to fame and success with a single marketable idea. The first college graduate in her family works her way to professional success and a six-figure career through sheer persistence and willpower. But are these realistic aspirations for most people?
Ross Eisenbery of the Economic Policy Institute disputes this idyllic picture of America. And he’s pointing part of the blame at the widespread practice of unpaid internships for recent college grads. These internships, according to the EPI, often offer no educational benefit or relevant career experience, while closing off opportunities to job seekers from disadvantaged backgrounds.
Despite what you hear in the media and on the campaign trail, the truth is that economic mobility is in the US is becoming more and more difficult by the day. Research by the Pew Charitable Trusts has found that a staggering 65% of US citizens born in the bottom fifth of household income never leave the bottom two-fifths. And 62% of those in the top fifth income bracket stay in the top two-fifths.
Research at the University of Ottawa shows that family background plays a stronger role in determining individual success in the US than in Canada – a difference of about 7-8%. A Swedish study had similar results, finding that 42% of American men in the bottom fifth of income stayed there as adults, compared to rates of 25% in Denmark and 30% in Britain.
Eisenbrey notes in a recent blog post that children from poor families are often excluded from participating in internship opportunities:
Unpaid internships, in particular, exclude students from poorer families who can’t afford to work for nothing for a summer or a semester, especially after they graduate from college with tens of thousands of dollars of student loan debt. The children of affluent families, on the other hand, can afford to live in the most expensive cities in the U.S., such as New York and Washington, making contacts, building their resumes, and sometimes even learning skills, while their parents pay for their room and board, travel and entertainment. Before even taking into account the family connections that reserve some of the best opportunities for the sons and daughters of the affluent, the $4,000-$5,000 cost of, for example, moving to Washington and living for 10 weeks prevents almost any working class kid from taking an unpaid internship.
He goes on to accuse the US Department of Labor of negligence in upholding minimum wage laws, and describes many internships as “illegal exploitation.” The EPI has been working with the Labor Department to try crack down on companies which use interns to replace regular employees in an effort to cut costs, but it seems that meaningful change has been slow in coming.
Photo by Seattle Municipal Archives