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Are Unpaid Internships Hurting American Economic Mobility?

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.

Related Stories:

Unpaid Internships: Valuable Experience or Unpaid Labor?

InternshipGate: Are Universities Letting Their Students Be Exploited?

Youthful Enthusiasm Leaves Grads Jobless

 

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23 comments

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11:00AM PST on Jan 17, 2012

Sometimes its the only way they can get there foot in the door!

8:37AM PST on Jan 16, 2012

During the last three years, while working full-time and job-hunting, I worked at and completed an internship, as well as volunteered for two different non-profits. At the time, when I was with the two non-profits, they were not hiring, but there were many educated interns and volunteers helping the two organizations. When they received unexpected grants and/or funds, they went and hired people off the streets. They sincerely passed up the fully qualified, unemployed volunteers.

I got the distinct impression that there was a type of sigma for being an unemployed volunteer. What I unexpectedly felt or sensed was not mentioned in the various newspaper and magazine articles. The articles I read evoked the desire to do the internship and the volunteering. I was not as qualified as many of the other volunteers by the way, but I thought it was sad that the two organizations did not even consider hiring any of the volunteers!!!

1:39PM PST on Jan 15, 2012

Unpaid internships are, at best, completely unethical and Should be viewed as illegal. All workers at any level, doing anything of value for any employer, should be paid at least the current Federally mandated minimum wage, no exceptions whatsoever. Of course, the current minimum wage is at least 30% lower than it should be, but just try to get an increase by any Congress that does have a solid two-thirds Progressive majority.

Be Progressive, Vote Progressive!

10:14AM PST on Jan 15, 2012

DOES VOLUNTEERISM HURT ECONOMIC MOBILITY?

12:46AM PST on Jan 15, 2012

Unpaid Internships are on the rise and their harmful effects are just starting to get the coverage they deserve. I have become so incensed by them that I started my own law firm dedicated to getting unpaid interns paid for the work they do.

Having extensively researched the law, I can say with some amount of credibility that unpaid interns, some of the most vulnerable people in our society, have been getting the short end of the stick. Check out my blog at www.internlaw.com/blog where I focus solely on this very problem and discuss some of the often unforeseen consequences.

5:27PM PST on Jan 14, 2012

Thanks

4:19PM PST on Jan 14, 2012

I think these internships are exploitative anyway, even if paid for by rich parents. In the UK one intern has won the right to be regarded as an employee, and so get at least minimum wage. Anyone in the USA tried that yet?

3:45PM PST on Jan 14, 2012

This isn't new. In the 90s, I was working with a woman who was working hard to get into a particular field, but she was at a big disadvantage because the opportunities were few and almost all of them required an internship background. Being from a poor background meant she faced what turned out to be a permanently closed door. She wound up going in another professional direction, one which paid less and was not what she wanted to do with her life. Unless you're privileged, you cannot afford to do unpaid work. This particular playing field needs to be leveled; otherwise equal opportunity is a joke.

12:17PM PST on Jan 14, 2012

didn't unpaid internships start out as a learning and networking advantage for students?
now it's been abused and companies are trying to get away with getting free work from skilled workers...

11:14AM PST on Jan 14, 2012

Thank you for the article...

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