Having an internship on one’s resume is integral to getting a career in today’s job market. Without an internship, an employer will most likely deem the applicant inexperienced, incompetent, or unqualified. Because of this, the number of internships has risen in the past few decades. The Department of Labor defines an internship as “a formal program providing a practical learning experience for beginners in an occupation or profession that lasts a limited amount of time” (Forbes).
An internship can be either paid or unpaid, and in today’s economy, the number of unpaid internships is higher compared to the number of paid ones. With the rise of unpaid internships, many recent college graduates or current college students are forced to take these positions. However, many students cannot afford to take up an unpaid internship, as they cannot make up for the lack of income during their internship. In contrast, there are students/graduates that can afford to take up these internships, therefore gaining the “experience” that they need from these internships.
This creates a social barrier. On one hand, there are privileged individuals who can make up for the fact that they won’t have an income during an internship. On the other hand, there are persons who cannot afford it at all. This leads to an inequality in both income and opportunity, as those who are better off financially can take up these positions, gaining more experience than those who cannot and gaining more opportunities to be successful.
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Internships were not always designed to gain experience. According to Forbes, formal internships acted as “apprenticeships in credentialed professional programs such as health care or accounting” (Forbes). Different from an internship, an apprenticeship is meant for one to keep the job with the company that they have an apprenticeship with. The apprentice is bound to keep working with the employer after the apprenticeship is over. As such, internships were rarer back then. It has since evolved into something else.
Starting around the 1990s, the formality of an internship began to disappear. Many companies started to offer internships as a way to get college credit, which was well sought by many during these times. This attracted a lot of well qualified applicants that have not yet completed college education, as they can gain experience and credit at the same time. This will most likely guarantee them a job, as gaining experience early in their education career can play a big role in their employer’s decision to hire them or not. In return, the company that employed this tactic would get basically free labor. It also doesn’t break any of the rules that decide if an internship will be paid or unpaid, as technically the interns are being “paid” through college credits. This type of internship largely benefited companies seeking to get work done for free.
By the end of the Great Recession, the path to success was paved by internships. According to NACE, the National Association of Colleges and Employers, the percentage of college graduates holding at least one internship position rose from less than 10 to over 80 from the mid-1980s to mid-2000s. This shows how popular internships were in the past, as it becomes clear that holding an internship position is basically required for one to be successful later in life and get a career. This is reflected in amount of graduates that got a post-graduation full-time position at a company, which rose from 5 percent to over 30 percent in the same time period.
The trend of the increase of hiring graduates/current students have not stopped in recent years. There is a projected increase of 1.7 percent for the hiring of interns. Although the projection for 2018 is lower than that of 2017 at 3.4 percent, there is still an increase in the amount of interns being hired. This would mean that there will be a large amount of internship positions available, possibly in the millions. However, this would also mean that the majority of these positions will be unpaid. According to Figure 2.02, more than half of the postings for internship positions are unpaid.
This would mean that the majority of interns will not be compensated for their work. Before 2018, the Department of Labor decided if an internship position will be paid or not through a six part test. The 6 criteria included things such as the educational benefit of the intern, the amount of work that the intern is doing, and the quality of the work that the intern will do3: This made it harder for a company to make an internship position unpaid, as all 6 criteria had to be met. However, in January 2018, the Depart of Labor changed this test to a 7 part test.
This new test would include parts of the old test, but with new criteria such as the knowledge of no expected compensation for the duration of the internship, the value that the work that the intern does to a company, and that there will be no guarantee of a job at the end of the internship. This made it easier for internships to be deemed as qualified for being unpaid, as the test became more flexible in terms of their qualifications. Also, none of the 7 factors are a deciding factor, and whether an intern will be paid or not will be decided based on the unique circumstances of each case. By doing this, the government is enabling companies to offer more unpaid internships, which will further increase both the income and opportunity gap.
With this test passed, the number of unpaid internships will surely rise. This will have a large effect on the job market, as college graduates/students who are not financially stable will not be able to take these positions. According to Robert J. Tepper, “many students simply may not be able to afford to complete an unpaid internship” (Tepper 348). With no guaranteed compensation, they cannot afford basic necessities for life. Instead, they have to take up part-time jobs at different places. Often times, the places that these part-time jobs are offered will not relate to their field of study, resulting in a lack of experience that is well sought after by employers in current society.
Without the experience, they cannot secure careers, and are stuck being jobless for an indefinite amount of time. In contrast, college graduates/students who are financially stable are more likely to succeed in an environment where unpaid internships are on the rise. Since they can afford to not have a source of income for a set amount of time, they are able to take part in unpaid internships. From these internships, they are exposed to work that their focus is doing, and in turn gain valuable experience that cannot be gained elsewhere. With the experience, they are able to secure jobs in their field of study, which will basically guarantee them high compensation for their work. This would keep them in their higher economic bracket, whereas those who are not as privileged will be stuck in the lower economic bracket.
One example where interns were not properly compensated for their work is the Fox Searchlight Class Action Litigation. In this court case, two interns, Eric Glatt and Alexander Footman, who worked for the movie Black Swan sued Fox Searchlight Pictures for failing to properly compensate them for their work during their internship as production assistants and bookkeepers. In this lawsuit, the interns argued that they performed administrative and clerical duties, maintained records and databases, and performed other productive works.
They also included that the defendants also relied on them to get more work done on top of the already large amount being given. The plaintiffs asked the court to rule that they were in fact employees, and that they are entitled to minimum wage compensation as well as overtime compensation. The court granted their motion, and ruled that they were in fact employees, and as a result, Fox Searchlight Pictures had to pay anyone who held an internship position at their company.4 This cements the fact that there are internships out there that does not properly compensate their interns, and this
It is apparent that the current internship market is increasing the income inequality gap. By promoting the use of unpaid internships, more privileged individuals can afford to take up those positions, gaining more experience for their resume, and in turn securing more financially stable jobs. Those that are less financially secure, however, are forced to give up these positions in favor of other work that offer compensation, yet lack the valuable experience that an internship would get. To combat this inequality, advocates suggests that the government should take another approach to it.
Instead of having a single 6-part test, a “primary benefit” test should be applied instead. This would determine the primary party that would receive benefits from an intern’s work, and that will dictate whether the internship will need to be paid or not. Companies should also seek to properly compensate interns for their role. While the work that interns do in a company may not be as important as that of actual employees, it is still an integral part of the present-day company model, and without interns, a company will most likely not succeed.
