Unpaid Internships Need to Go

As the job market becomes more and more competitive (i.e. there are more and more people in the world), people in the recruiting world seek quick and easy ways to distinguish candidates from one another. If you’ve got a stack of 500 resumes in front of you, and the bulk are simply people who have graduated from University, how do you even begin to create a short-list? You can’t (legally) discriminate on the basis of the candidates age, ethnicity, gender, or religion, so… what now?

As a candidate for a position, you want to present the best possible picture to a prospective employer. Getting a job while at school, however, isn’t really an option: the kinds of jobs that will allow part-time work that doesn’t interfere with your classes during the day are not really all that useful when applying for the kind of work that a university graduate has the education for.

The solution to both problems is: internships. And this is deeply problematic.

The basic concept of an internship is that someone will work for a company, but in place of “money” they’ll receive “training”, and this training should ostensibly be to the general benefit of the intern. Many internships are paid, but many more are not.

This is, I feel, deeply problematic. This is bad for individuals, bad for business, and bad for the economy (both local and global).

Bad for Individuals

If we look at the individuals in a society, and we see that a large number of jobs require a period of unpaid internship in order to successfully apply for those positions, then we are closing off those jobs to a large number of the population: only those people who can afford to work without pay for the period of internship (typically several months) can afford be an intern. Those job sectors become, in essence, pay-to-play: if you want to work in that sector, you need to have set aside sufficient money to cover rent, food, and incidentals for the period of internship and the subsequent period of job-hunting that will follow.

So long as these individuals are working in this unpaid internship, regardless of the actual skills they are acquiring, they need to have either stockpiled a large sum of (rapidly dwindling) money, or they need to pick up a second job on the side. Funnily enough, being overworked and stressed has a negative impact on your levels of patience, and your ability to focus and learn, so the internship, by virtue of being unpaid, is less effective than it would be even if it paid minimum wage.

Moreover, this can lead to a near-endless cycle of internships as jobs require more and more ‘internships’ to be on a resume prior to hiring. This further separates out those who can afford to work for free from those who cannot. Bear in mind here that what is dividing these two groups is the pressure from HR departments who won’t offer an interview to someone who doesn’t have the requisite “experience”, and that the divider here is not “skill”, “merit” or “ability” but “can afford to work for free”. I’ll return to this later.

For an individual, except in unique and rare circumstances, the unpaid internship is all bad.

Bad for Business

As a business, an internship is an opportunity to train someone up, ideally to place them within the existing workforce. It can be seen as a sort of trial period to see how a prospective employee fares within a particular work environment. It’s important to note here that most internships do not afford the right to the intern to become an employee: this is not a ‘training period’ of a larger contract.

The business needs to look at the pool of prospective interns, and ideally choose the candidate who will (ultimately) benefit the business the most. However, going back to it being unpaid means that the pool of interns has just been restricted in a way that runs counter to good business: a number of interns have been filtered out by their inability to afford to work for free. The ones that remain are those who simply have enough money to sustain themselves through the period of internship (which is, in and of itself, not a marker of ability), and those who are prepared to work at additional jobs while undertaking the internship (meaning they are going to be over-worked during this period, and concern about making ends meed will inevitably bleed into their internship).

Beyond money, an internship costs a company the time of another employee (or several employees). The intern needs to be supervised, their work needs to be reviewed, and they need to be mentored. This is time intensive. The payoff is that when an intern has been sufficiently brought up to speed that they can be taken on as an actual employee, but by limiting the pool of interns (by offering no pay) the chance of succeeding at finding a new hire have been significantly curtailed. Sure, if the intern doesn’t work out, then no money has been spent directly on the intern, but company resources have been wasted to no benefit and you need to start the process again.

Moreover, the pool you have open to you is the extremely small section of people who can afford to work without pay (whose abilities now need to be assessed), and those people who will also be working in an additional job (who will be over-worked and over-stressed). These appear to be poor choices.

Meanwhile, just adding the minimum wage to the internship is, in the grand scheme of things, a negligible cost, and has the upside of broadening the selection pool: people who would otherwise be over-worked can now focus on the training, and people who wouldn’t even bother to apply (as they are only willing to do one job at a time) would now do so. The chances of you finding a good hire with reduced cycles of internships have drastically increased. The payoff here seems to be greater than the cost by several orders of magnitude.

Bad for the Economy

Unpaid internships are bad for the economy? What? How?

In very broad strokes: a healthy economy is when money flows; an unhealthy economy is when money does not flow. An economy tends towards these extremes depending on the flow of money.

With regards to an unpaid intern, money is definitely not flowing. If there’s only one unpaid intern in the entire country, then this has (for all practical purposes) no effect on the economy. However, if businesses don’t realise the cost of internships, and individuals see no option but to take on internships, then internships will begin to proliferate. How big a problem is this? That’s an excellent question.

In trying to put together this section of the essay, I ran into a bit of a hitch: internships are not documented. Turns out that no-one is keeping track of how many interns are out there, so all that we have available are estimates and guesses. A number in that article is that there could be up to 300,000 in Ontario alone. For the sake of being a little conservative, let’s call it 200,000. Ontario has a labour force of 6,086,815 according to Stats Canada (out of a population of roughly 13 million) , so that’s roughly 3% of the labour force that may not be receiving any income from their internship.

If 3% of an area (local, national, or global) aren’t receiving an income, that’s going to have a serious impact on the economy of that area. Those people are necessarily going to have their expenditures constrained. If they work a second job in order to make up for the lack of income from the internship, then the time they spend working will not be available for leisure activities (i.e. spending money in the local economy). A world where there are unpaid internships is a world that has a worse economy when compared to a world where all internships are paid even just minimum wage.

Unpaid internships are necessarily bad for the economy.

Bad in Principle

A fundamental truth is that all value is generated by labour. All the income of a business derives from the labour of the people involved in that business. No labour = no income.

Justice, at a basic level, requires trades to be equitable, that what I give you is (to some degree) commensurate with what you give me in exchange. Sure, our perceptions of that value may be out of whack, but the values may still be determined. Issues arise, however, when there is a mismatch in perception such that we end up committing a fraud.

Interns produce work within a business. They are not merely sitting in isolation, producing fake-work that goes nowhere in order to ‘have the experience’ of working: they are contributing to the business. They are contributing to the income of the business. And sure, as I mentioned above, there is a cost to the company in terms of supervising and overseeing that work but such is the nature of supervising. Having a cost that needs to be absorbed does not justify in passing that cost onto a worker: they are involved in a trade with the company, their labour for some kind of training. All investments have costs built-in; the people you otherwise trade with are not going to accept “well my payroll is high, so I’d like you to reduce your prices”: that’s your problem, not theirs.

A minimum commitment to ethics demands that the training be something that the intern would otherwise be willing to pay $80 a day, or $400 a week,  for (to use British Columbia’s minimum wage): if the training isn’t worth that much, then the company owes the intern money, as we are moving towards fraud. As a point of comparison: if you were to take Commerce in UBC, you’re going to take 5 courses (in each semester) at about 15 hours each week (26 weeks total over 2 semesters). The charge (for the courses) is $7,104 which breaks down to about $18 per hour. That is “the value” of the education in Commerce, as per UBC. If the training that your organisation is offering as part of an internship wouldn’t be worth paying $18/hr for, then it would not seem to be meeting a basic standard.

Additionally, both Canada and the US have explicit laws about internships:

Ontario,Canada, point 3: The person providing the training derives little, if any, benefit from the activity of the individual while he or she is being trained.
The US, point 4: The employer that provides the training derives no immediate advantage from the activities of the trainees, and on occasion the employer’s operations may actually be impeded.

British Columbia goes further, stating:

An “internship” is on-the-job training offered by an employer to provide a person with practical experience. Often internships are offered to persons who have completed a diploma or degree program and are seeking employment. Completing an internship does not itself result in an academic certificate or diploma. If the duties performed by interns fall within the definition of  “work” contained in the Act, the intern falls within the definition of “employee”, and the agency using the services of an intern falls within the definition of “employer”, internships will be considered “work” for the purposes of the Act.

Ironically, most of these points seem lost on people who are involved in business (though I’m sure that if they bothered to consult with a lawyer, it’d be cleared up in no time). From discussions on a friend’s Facebook page (nope, I won’t be linking to it), it would seem that many people are under the impression that an internship exists for the employer to “evaluate” the employee (this is what the ‘probationary period’ of employment is for), they feel that it’s “unfair” to have poured resources into someone who decides that they don’t want to work for them in the end, or they wish to expand the business but just can’t afford to employ additional staff. All of these. Unpaid “internships” abound on both Craigslist and Indeed.ca (though you often have to browse the details to determine that they are unpaid) despite them being explicitly illegal in Canada.

The bottom line is that unpaid internships exploit the desperation of job-seekers, by claiming to offer something that will set them above others and be more desirable to employers. The reality is that unpaid internships are primarily a way for employers to get labour for free.

They should be regulated out of existence.

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