The Intern Economy: Inevitable Inequality?

Occupy Wall Street protests. Picture: Michael Fleshman, Flickr

‘In much of the developed world, the subtle, relentless pressure to do an internship is now simply part of being an adult’ writes Ross Perlin in his book ‘Intern Nation’. The growth in both the supply and demand for internships is something which most young people recognize today. Although internships have always played a certain role in career development this has increased steadily over the last number of years. In an EU report on traineeships they show that 46% of respondents had completed a traineeship. This can be explained by various factors such as the change in the structure of the labour market with fewer opportunities for permanent employment, high youth unemployment or a general increase in university graduates.

Arguably, a fundamental issue with internships, especially those which are unpaid, is their perpetuation of inequality. Although this picture is varied across countries, in the same EU report it does show that 6 out 10 respondents received no financial support during their last traineeship. There are many policies in Western countries which aim to decrease inequality in education, but this kind of internship structure can further entrench both economic and social inequalities. At the end of 2012 youth unemployment for the EU-27 was 23.2% and 16% for the United States, this trend has and will continue to cause insecurity for young people and therefore perpetuate the ability of employers and public bodies to promote unpaid internships.

To highlight the impact of the growing ‘intern economy’ propublica, a non-profit media outlet which focuses on investigative journalism, has launched an investigation into this new and booming sector of the economy. This investigation aims to research the effects of this trend on individuals but also to assess how this system could potentially promote elitism. A person must be able to support themselves if the internship is unpaid. In many European countries there is a solid system which corresponds with the student funding system, such as in Sweden, Germany and the Netherlands, while in other countries, such as Denmark, internships can be linked to the social benefit system.

However, in the UK and US, unfunded internships are more common and there has been a growth in the exploitation of interns and the promotion of elitist appointment procedures. So much so that the British Trade Union Congress has set up a rights for interns committee which outlines ‘what rights you have as an intern, and how they can be enforced’. The EU report on traineeships shows that only 19% of those who have graduated from University have not had an internship, apprenticeship or a student job whereas 37% of those who have not graduated from university responded that they had ‘none of these’. In further research carried out by the Unite Trade Union, the rise in unpaid internships in the third or voluntary sector is discussed. Their findings suggest an alarming trend that it not only excludes certain sections of society from applying but also that the actual quality of the experience the intern receives is often quite limited.

Another factor to consider is appointment procedures. David Dennis has written in the Guardian, about how the elitist system of unpaid internships is damaging journalism and risks drowning out the voice of ordinary people because those from less privileged backgrounds simply cannot take up an unpaid position and therefore find it hard to enter the system.  The value of gaining work place experience is high and often internships give young people a valuable insight into particular career paths, therefore it is in both the employers’ and potential interns’ interest to ensure the system offers quality and equal opportunities.

An interesting point is how internships or work placements can be used to counter the negative impact of youth unemployment. During Franklin Delano Roosevelt’s presidency of the United States, his administration created work programmes to halt not only the economic consequences of unemployment but also the social harm it was causing in the 1930s. Anthony Badger discusses in his book how these programmes also played an important role in improving the infrastructure of the United States. Clearly today’s labour market is more complex but the ideology behind such schemes was fundamentally different to the ideology behind an unpaid internships. Governments could use an internship style system to stimulate employment, but in order to ensure not only an adequate quality of experience, but also the basic social function of selling one’s labour, there should be paid positions available, or at those with some financial backing. An example of such a scheme can be seen in Ireland, it is termed Jobridge and is a government run schemes which provides work placements for six to nine months. Interns get €50 allowance on top of their weekly social welfare entitlement which varies between €100-€144 a week. There have been many criticisms pointed at this scheme, the most fundamental of these is that it is essentially a work programme rather than an internships scheme, and the employer pays nothing for this increase in labour.

Belgium, the UK and Cyprus, as well as the United States, show higher trends in unpaid internships than most other European countries, and there is a danger that this trend will spread due to the economic and social crisis which is gripping Europe at the moment. Lack of employment security for young people risks allowing unpaid internships to become the norm. Perhaps what is most concerning is that even when a person carries out an unpaid internship often the true value of the experience is below what it should be. This is arguably due to the lack of financial commitment and regulation in the internship sector.

Nonetheless, internships remain an important part of education as they provide students with valuable workplace experience. It is therefore important for the development of a productive labour force, and the reduction of inequality, that governments put in place systems that enable the participation of students from all economic backgrounds.


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