Unpaid internships – the good, the bad, and the ugly

by Grace

It’s an employer’s market out there but is there any excuse for employers getting free labor from interns?

Unscientific survey of interns conducted in New York City near the campuses of NYU, Columbia, and FIT

The good and the bad
Unpaid internships are problematic.  On one hand, they can offer unequaled opportunities for college students to gain real-world experience in their chosen field of study.  But some employers take advantage of free labor, only using students to handle menial tasks.  And lower-income students who cannot afford to take a summer off with no pay are penalized in this competitive race to gain valuable industry experience.

The practice of not paying young people for their labor has become so ingrained in the everyday practice of American business that we’ve forgotten how bizarre and recent the development is. In the early 1980s, 3 percent of college grads had had an internship. By 2006, 84 percent had done at least one. Multiple internships are common. According to a survey by the National Association of Colleges and Employers, more than 75 percent of employers prefer students who have interned or had a similar working experience.

Employers have feasted on despair — and these aren’t internships for struggling small presses or rarefied design companies. Subsidiaries of General Electric, a company worth $200 billion, employ them regularly as an “important recruiting tool.” Disney uses eight thousand of them in dismal working conditions. Jennifer Lopez Enterprises uses them. So does The Daily Show. So does the pope. And because internship programs are sheltered from the violation of labor laws by the complicity of universities that give students “credit” for them — as long as the students pay thousands of dollars for those credits — American companies can operate these programs for the most part hidden from scrutiny. The best study of intern life in America found that companies save annually around $2 billion from pseudo-employment.

Government regulations
For-profit employers can get away with not paying student employees as long as they follow the federal government’s six-point test that attempts to ensure an educational experience for the intern.  I agree with the National Association of Colleges and Employers (NACE) that the criteria are reasonable except for the one requiring that the employer derives no immediate advantage from the activities of the student.  What?  If the intern is to perform meaningful work, it would be hoped the employer will benefit.  With a rule like this, the government seems to be encouraging employers to skirt the law.

Charles Murray, writing on the problem of growing class divisions, suggests that unpaid internships should be banned.

It amounts to career assistance for rich, smart children. Those from the middle and working class, struggling to pay for college, can’t afford to work for free. Internships pave the way for children to move seamlessly from their privileged upbringings to privileged careers without ever holding a job that is boring or physically demanding.

I disagree with his extreme recommendation, but I would support allowing internships to pay less than the minimum wage.

It can get ugly
This topic is particularly relevant for me since we recently learned that my college son will be working this summer at his dream internship, unpaid.  I am thrilled, but here’s how desperate I am.  Given the tough labor market and the importance of relevant work experience in securing a job after graduation, I would be willing to pay for my son to get the right internship.   Apparently I’m not alone, as internships for sale are part of a growing trend.  I consider that the  “ugly” part of this internship story.

Related:  ‘Six in 10 internships lead to jobs’

5 Comments to “Unpaid internships – the good, the bad, and the ugly”

  1. The whole unpaid internship thing is such a scam. SInce the 90’s, companies have used unpaid interns as cheap labor. It is part of the entire trend where companies are no longer willing to put money into education. There was a time when big companies at least would hire the incoming student, PAY THEM, and put them through a training course that could last even up to a year. No more. Now it is contingent on the student to fund this experience. Do you realize that if a student does an educational internship for credit, he or she has to pay tuition??? I think the company should be ponying up at least some of the tuition for that period. Or else pay the student.

    Companies whine that we don’t produce students up to their snuff, but they aren’t willing to put any money into training or education. So is it any wonder that colleges cater to the students rather than the employers needs?


  2. Hmm, it seems that the unpaid internship trend is another way that college costs have been rising, but usually not included in traditional measures.

    I’ve read anecdotes about college students desperately trying to find an employer who will offer them an internship that is a requirement for graduation. In some cases these students settle for lousy internships (for which they’re paying tuition) just to graduate.


  3. Yep, lots of professional programs, in order to be accredited, have to require internships. That is quite true in the healthcare fields.

    Over the past 20 years, there has been a strong trend for employers to dump training costs onto workers. When I graduated from college, unpaid internships were still unusual, and most companies put new hires through several months of training, while paying those new hires. Companies also funded continuing education. Sadly, the tech industry at least has largely backed away from paying for continuing education. It is very much a “you’re on your own” thing now.


  4. Related:

    “New York’s chief judge has announced a new requirement: Would-be lawyers will have to perform 50 hours of pro bono before they can get a law license.”



  5. And a story about companies using MBA students to handle marketing projects.

    Bob Krapfel, associate dean for M.B.A. and M.S. programs at the University of Maryland’s Robert H. Smith School of Business, says organizations are attracted by the fact that they can “pay next to nothing” for “pretty high-quality M.B.A. talent.”

    If you can afford it, it’s great experience for the students. I’m sure that’s also true for the law students doing pro bono work. That’s the dilemma, I think.



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