Unpaid Internships Lead To Lower-Paying Jobs, Study Finds (theguardian.com)

The Guardian reports: Almost every graduate taking an unpaid internship can expect to be worse off three years later than if they had gone straight into work. That is the shock finding of the first survey of its kind of the career trajectories of tens of thousands of students over a six-year period. The study, conducted by the Institute for Social and Economic Research at the University of Essex, reveals that, three-and-a-half years after graduating, former interns face a salary penalty of approximately £3,500, compared with those who went straight into paid work, and £1,500 compared with those who went into further study... The study also found that those who took internships were less likely to go on to professional or managerial roles or be satisfied with their career compared with those who had gone straight into work.
Slashdot reader BarbaraHudson warns unpaid internships are also "a possible indicator of a large oversupply of workers to jobs available and downward pressure on pay." Anyone else want to share thoughts about the current job market for professionals -- or your own horror stories about your first job after college?

Comments

US parent here

[rsilvergun]

Not sure about the UK, but in the States you use unpaid internships to help get into your 300 level courses. After 30 years of budget cuts schools don't have enough space for all the applicants in most majors (especially medical, and not just full medical doctor, think Nursing, pharmacist, physical therapist, etc, etc). Even a perfect GPA won't guarantee you a spot anymore. So you volunteer, do extracurricular stuff and finally internships. My kid got lucky and got what's more or less a paid one. But it's like winning the lottery what with the number of applicants.

Re:US parent here

[Anonymous Coward]

I assume by 300 level you mean upper classmen junior level at university. I suppose that depends on your kid. If they enrolled as a freshman they don't need to do internships assuming they actually passed their 100/200 level courses to go on. Most 300 level courses in engineering for example have prerequisites that you pass the previous 200 level courses with a C or better.

If they attended a junior college first, then yes I can see that it's competitive to get enrolled unless you have excellent grades and something meaningful to put on your application.

In Texas although university education is still funded unlike in some states because of the Permanent University Fund (oil money) the competition to get enrolled is fierce especially to UT or A&M. It's not a question of money there are just more kids trying to get in - many HS stopped vocational training. It used to be if you were top 10% of high school class you were basically guaranteed enrollment 30 years ago. Not so much today so many kids start in lower tier schools first. Internships would certainly help there.

Re:US parent here

[ranton]

in the States you use unpaid internships to help get into your 300 level courses

This story is studying graduates who take unpaid internships, not students who take unpaid internships. Those are very different things. This study is looking at people who couldn't find work after they graduated and had to settle for unpaid internships, and then seems surprised these students make less money down the line.

For this study to have any relevance, they would have to look at graduates who had an offer for a paid position but chose to take an unpaid internship instead. Then look at their earnings 10 years later as compared to those who took the paid gig (after adjusting for the quality of the original paid job offer). I would still expect the ones who took the paid position to win out, but at least then you would have something interesting to discover.

Re:US parent here

[LynnwoodRooster]

Budget cuts for universities... For the last 20 years, tuition at universities has greatly outstripped the inflation rate. Assuming costs of running the university don't grow more than 1.4 times inflation, then there should be plenty of money to serve students. Of course, the growth in the cost of a college degree has doubled that of inflation, so...

Invisible Hand.

[0100010001010011]

Shouldn't unpaid internships in a field be an indication of the saturation of the job market in addition to job prospects after graduation? We have highschool dropouts making $20+/hr where I live and companies still have a shortage of good workers. You can make a very good living working in those fields.

Even if you just use it as a stepping stone to another career. These people made the personal decision to go into a field that was saturated with people wanting to be in it and unpaid internships are a very easy filter.

Hell if you can pass a drug test and show up on time you can make pretty good money driving trucks right now. I wouldn't bank on that long term but it should be more than enough money to save some, take night courses at a community college and leverage it into another career.

Re:Invisible Hand.

[TheRaven64]

Exactly. In a high-demand field, a paid internship is a cheap way of hiring: you get to spend three months finding out if your prospective employee is competent and they get to spend three months deciding if they want to work for you (and, if they are competent, you get to spend three months persuading them that they do). In comparison with pretty much any other hiring mechanism, a paid internship is very cheap, in a field where there's a skills shortage. If companies in a field can easily hire competent people without this, then that's a good indication that there's a glut of talent.

Re:Invisible Hand.

[ColdWetDog]

A high end welder has motor skills as developed as a surgeon or a pilot. While the intellectual chops for that aren't quite as demanding, they're not all that far behind. The *really* good welders here in rural Alaska, the ones that do pipeline or marine construction have spent nearly as much time learning their trade as a surgeon or pilot and make nearly as much money.

A better analogy might be the various stages of electricians. At the low end you don't need to know much, don't need much of an education or job experience and don't make a great deal of money. The master electricians who are responsible for high voltage gear again spend decades learning this stuff and are compensated accordingly.

However, the US doesn't need huge volumes of either trade (unfortunately) so it is a difficult choice for say, a high school kid, to decide where to go unless you have a strong interest in the field.

Re:Invisible Hand.

[Woldscum]

Robots work in large factories. Not in the field repairing broken equipment or building one-offs. It is just not the act of welding and following a set of engineered drawings. It is applying experience to the situation and "Just making it work". Time is money and the welder/fabricator is the defacto engineer. Clearly you have never worked a day in your life.

Re:Invisible Hand.

[Dutch Gun]

Clearly you have never worked a day in your life.

Well, not outside an office anyhow. I see this from slashdotters all the time. They have no practical experience outside an office, and so *vastly* overestimate the capabilities of robots and automation, largely because they don't understand industrial or light industrial work sites. There are a LOT of types of work where automation can only go so far, or in bits and pieces, and requires the dexterity and flexibility of human workers to put these products together.

My father ran a light manufacturing operation for many years, and most of his products were one-offs. His business used a lot of high-tech tools, but skilled people were still required to put it all together - certified welders included. Until a robotic welder has both the dexterity of a human AND the intellectual capacity to cope with changing projects and requirements, we're still going to need humans to do the job.

It's almost as if labor has value

[FunkSoulBrother]

..and you shouldn't squander it away by demonstrating that you're willing to provide it for free.

See also:

-Programming contests where the hosting corp gives $100K as a Grand Prize but retains rights to all of the contestants code (and doesn't even pay any FICA tax)

-The NCAA making billions off of 'student-athletes' with lucrative television contracts

Re:It's almost as if labor has value

[drinkypoo]

..and you shouldn't squander it away by demonstrating that you're willing to provide it for free.

The deeper issue is that companies should not be permitted to "hire" unpaid interns, period, so long as being broke is effectively a crime. That's taking work away from people who need to get paid to just go on existing. It is essentially a kind of slavery (indenturement anyway) and the expectation that they will be able to get unpaid interns only leads companies to hire inadequate numbers of employees. If a business can't function without paying people for their time, then it doesn't deserve a business license.

If we institute a functional MGI then businesses should be free to collect unpaid interns like pokemon cards, but until then, that should be illegal.

What about unpaid internships *during* school?

[mykepredko]

A local college has offered my company students who must complete an internship to get their degrees (in software engineering). There is no requirement for payment as this is a requirement to graduate and we were told by the college the best the students could hope for was a letter of recommendation. We are unusual in that we are paying the students and are working through a contract with the college to take on paid interns - this is in line with our B-Corp certification and general company philosophy.

So, for the majority of students from this college (and others), who have unpaid internships in order to get the piece of paper saying that they graduated from the program, what does this mean for their future salary prospects?

Correlation is not causation

[OldMugwump]

News flash: Students who can't get paid internships often later can't get the best-paying jobs, either. Correlation is not causation.

Re:Correlation is not causation

[BarbaraHudson]

Except that kids whose parents have higher incomes get a disproportionate percentage of the paid internships. Has nothing to do with ability, everything to do with connections. It's actually right there in the article.

...unpaid as an intern for 35 years

[j-beda]

"This is That" is a statire news show:

http://www.cbc.ca/radio/thisis...

Meet the man who went unpaid as an intern for 35 years

After being offered an unpaid position as CEO of his company, Bill Marshall has had enough and is blowing the whistle on unpaid internships.

"For 35 years they just kept telling me I was getting on the job experience ... now I know I was being taken advantage of." ....

Willing to work for Free

[Anonymous Coward]

(Interviewer): Oh, I see on your Resume` that you are willing to work for free?

(Job Seeker): Well.. I Interned for free while in college..

(Interviewer): Indeed. I believe we have the perfect position for you at our company, how soon can you start?

Unpaid Internship

[Neuronwelder]

You volunteer your services for free, and get a slap in the face in return. Well, if they don't want to pay, maybe you can get a direct job with your new experience at some other place that appreciates you?

This was a study not experiment, correlation only

[itwasgreektome]

There is a great danger in inferring causation here, as this was a survey and not an experiment (with people randomly assigned to either group). The article wrongly states there is causation at play- that going into an internship caused them to be paid less later, rather than a real possibility that those that couldn't get jobs (or well paying jobs) decided to go the intern route instead. And those that got accepted into well paying jobs took them. So the cause might well be that the lesser paid or non-existent jobs caused the internship rather than the reverse.

Re:"shock finding"?

[BarbaraHudson]

People are being told that an unpaid internship will improve your chances on the job market, and they obviously believe it or they wouldn't do them. And yet, 3 years later they're still behind in earnings, and they're less likely to be working in their field of choice. Probably would have been better off taking a job in something else just to pay the bills while looking for an opening.

Students are being ripped off twice - once by the university, which charges for the time they're working for free, and the second time by the business they're working for free at. So you're not working for free - you're paying to work. At least slaves got fed on their master's dime.

Employers aren't allowed to use unpaid interns to do the jobs of regular employees, so the internship doesn't even give you experience actually doing the job - and employers know this.

You also don't get the same protections as regular employees. For example, don't get hurt on the job - since your wage is $0.00, workmen's compensation will be a percentage of $0.00, which is $0.00. Your only recourse would be a civil suit, and you can expect both the school and the company to say the other party is responsible for any loss.

The only internships worth anything in the eyes of future employers are paid internships. That's also how you should evaluate them - same as any other job. If you want to work for free, do it for a charity. Better yet, arrange for your internship to be at a charity - at least this way you haven't devalued yourself by working for free at a for-profit business.

Re:"shock finding"?

[LynnwoodRooster]

I would assume that having an unpaid internship would improve your chances of landing a job; a little seasoning, a little experience is a great thing! Of course, it will probably also depress your market value simply because you've already proven you are willing to work for free... So the question becomes working for free - and depressing future earnings potential, but at least working in your chosen industry OR working in a different industry and running the risk of being excluded because you are already "out of the mainstream" with your talents and skills.

Completely agree

[Anonymous Coward]

Colleges rake it in. This is due to the amazing abundance of taxpayer-backed student loan money. Also, this is due to the widespread understanding that one must have a college degree in order to succeed in business and in life.

The very unfortunate net effect here is that our population is tremendously over-educated. Some degrees (like journalism, for example) churn out more graduates each year than there are job openings on the entire planet. These kids are being sold an utter fantasy and are facing lifelong debt, no realistic job prospects in their chosen field, and depression from their shattered dreams.

I imagine that once upon a time a college education really differentiated someone in the labor market, and opened the door to a higher economic class. This worked precisely because the majority of people could not afford it. Now that we have evened-out the playing field, the resultant oversupply of educated labor has made the value of such workers plummet. We respond to this problem by continuing to make it worse.

There are still some fields where one can be differentiated by true competence: any field where knowledge and education simply aren't enough to succeed; where one needs significantly above-average genetics behind their brain power in order to succeed. Education is still a necessary prerequisite, but education alone will not prepare a person to face the challenges. There, and only there, can students expect to find high paying work when they graduate.

But....most people can't do those jobs, and hate them anyway.

Re:Completely agree

[Anonymous Coward]

Colleges don't "rake it in." America's public university system used to be just that--an education system paid for by the public through taxes. 30 years ago a state university typically got 80% of their budget through the state. Today a state university is lucky to get 25% of their budget through the state. That shortfall has to come from somewhere so tuition has skyrocketed.

Re:"shock finding"?

[mikael]

In the UK, they were charging interns £1000/month to get "work experience" for six months.

Re:"shock finding"?

[BarbaraHudson]

The problem with that, and it's pointed out in the article, is that people who take unpaid internships end up not just with lower future earnings, but also are more likely to end up in a field other than their chosen one.

A little experience at ANY paid job is probably better than unpaid experience. Unlike the unpaid interns, who aren't allowed to replace regular workers (and as a result don't gain real experience anyway), the person who works at a paid job outside the field has probably had more responsibility on the job, and that, combined with your transcripts, should count for more than a "not-really-relevant-experience" internship.

Employers know the whole unpaid internship thing is a scam. They take them because, what the hell, maybe they'll come across someone halfway-decent, and if they don't it hasn't cost them anything and they have someone to order around doing menial jobs for free. After all, even if it were allowed, just how much responsibility would you hand over to an unpaid intern? They have far less skin in the game compared to someone working for $$$. You don't give them a good recommendation, there's always someone else looking for free labour.

unpaid internships are basically illegal in the US

[netsavior]

The federal regulations on them include provisions that the company receive "no immediate advantage" from the activities of the intern... in other words, they can't do real, profitable work for free.

Not that the law is actually enforced.

But if the company is willing to skirt employment law in order to get something for nothing, they are going to fuck you once you get hired there too.

Re:"shock finding"?

[hord]

That's how it is sold. A real internship is called an apprenticeship, is paid, and directly leads to a career path. Internships are just social avenues for networking and the people that succeed take full advantage of that, not the "experience" gained.

Not all internships are created equal...

[__aaclcg7560]

My paid internship came about because my roommate's work needed an extra QA tester but didn't have any money in the budget for a full time staff member. For six months I regressed 600+ old bugs, organized the storage closet, and wrote a 250-page manual. That started my technical career 20+ years ago.

Causation

[knightghost]

From what I've seen, people going into unpaid internships are the lower quality students that couldn't find paying jobs. It makes sense that they don't progress as fast later.

Colleges don't rake it in

[rsilvergun]

unless their for profit. My kid's going to a public university. The only admin folks making good money are the dean the football coach and the basketball coach. Everybody else makes jack. The professors make low six figures, but they're also tops in their fields. Most are there so they can get money to do the kinds of basic research that corporations won't fund because while both interesting & beneficial it doesn't pay off for decades.

College is just really, really expensive. It always has been, but we funded it with tax dollars taken mostly from the upper class. We did that because post WWII folks felt they were owed a good life with an education. People seem to have lost sight of that. Or if they think they're owed something they think it's just them that's owed it and that everybody else should just pay for it themselves.

Re:"shock finding"?

[ShanghaiBill]

Correlation is not causation. The people accepting unpaid internships are those at the bottom, not very bright, not very hard working, and with no other easy alternative. These people would likely end up in low paying jobs no matter what. TFA describes a survey, not a controlled study, so there is no actual evidence that the unpaid internship caused the poor outcomes.

Oh, one other thing: TFA is about the UK, but in the USA unpaid internships are generally illegal. If an intern is doing any actual work, the employer is required to pay at least the legal minimum wage. If you did an unpaid internship in the past few years, it is very likely you can demand back pay by threatening to report your employer to the DOL.

Re:"shock finding"?

[GuB-42]

An unpaid internship is not necessarily exploitation.
If the company actually takes time teaching you how to work, it can cost them more than any output you produce. And as an intern, you are not expected to be as productive as an experienced worker, and someone is likely to come after you, fixing your mistakes. It results in you taking valuable time from full-payed employees while not offering much in return. The reason these company take interns at all is that by the end of the internship, you may turn out to be a great potential hire.
At least it is the idea behind internships. However some companies abuse the system to get slave labor. And honest companies are more likely to pay interns anyways.

Screw that!

[p51d007]

I've been gainfully employed for almost 40 years. Right out of college. If I'm not worth paying for my labor, then it's not worth working for a company.

You're lying

[rsilvergun]

or being lied to. Not sure which. See here. Took me a few seconds on google to find that. The sad thing is you managed to get modded up.

Cutting student loan funding isn't to solution. All that does is force poor kids completely out of college. Like it was before we started funding higher education with tax dollars post WWII.

If you're just being lied to please educate yourself on google. If you're actively lying then, well, fuck off you right wing revisionist. Right back at you.

Re:You're lying

[cheesybagel]

Of course total state funding to universities is increasing faster than inflation if more people go to colleges. What we REALLY want to know is the funding/student adjusted for inflation.

the banks are raking it in with the loans and the

[Joe_Dragon]

the banks are raking it in with the loans and the schools have no need to cut the price.

Re:"shock finding"?

[BarbaraHudson]

Department of Labor Rules to determine if an intern needs to be paid.

You're revenue figures are false

[rsilvergun]

they come from private for profit schools that rose up as blue collar work disappeared due to outsourcing and people who couldn't hack college found themselves without opportunities and desperately trying to get ahead. They did indeed take advantage of cheap, guaranteed government loans. The public universities are non-profit. They have no revenues per se.

You know all this. You know exactly what the problem is, which is that we abandoned the working class so the rich could have tax cuts. Are you one of their lackeys or do you just enjoy trolling? You've got the talking points down too well to just be some random yahoo. Either way you should be ashamed of yourself. You and your ilk bring down all of civilization out of fear, anger and hatred. Does it feel good? Is it worth it?