Unpaid Internships Are About Exploitation, Not Helping The Jobless

Thus “banning unpaid internships makes the barriers to entering internship-heavy fields higher, not lower.”

Actually, the barriers would seem to me to remain the same. If the same total number of people are looking for the same limited number of paid positions (no one wants to stay an intern forever), then whether or not any group of them gets an edge over their rivals by first training on the job and proving themselves for months, free of charge, won’t change the net-effect.

In fact, since Yglesias concedes the at least some fraction of the unpaid internships which don’t meet current regulation guidelines would probably be replaced with paying positions, and thus the total number of jobs would increase, we would expect that the actual net-effect would be for more people to gain entry into these fields, not fewer.

Yglesias argues (I think) that really, the elimination of unpaid internships actually gives an unfair advantage in various professional fields to those who can pursue the extra training through expensive graduate programs. He chooses journalism as a case study. So many more people want to be journalists and writers than the market will currently sustain. The scarcity has forced laborers in that field to either forgo wages through internships, or borrow even greater sums of money to pay for M.A. programs.

But this is unconvincing, at least to me. One form of voluntary exploitation is less egalitarian than another, therefore we should support the opportunity for aspiring professionals to sell themselves? The thing is, while internships might be more egalitarian than resorting to graduate programs in this one instance, they still disproportionately serve those from upper class backgrounds. Sure, getting rid of unpaid internships might give a slight edge to those who can bankroll a $20,000 to $50,000 masters degree, but it also gives a significant edge relative to their more affluent peers, to all of those laborers who currently can’t afford to do either.

Then there’s the clincher,

But where educational value is present, there’s nothing wrong with paying in the form of labor rather than paying with money.

As soon as you accept this statement, all bets are off.

Interestingly, throughout the piece Yglesias keeps the focus on internships while never talking directly about on the job training. And yet so many of the arguments he makes would seem to apply both.

Accepting the above statement for instance, we would expect, in a very bad labor market, that downward pressure on wages from increased competition would drive many people to seek to work for free on a provisional basis in order to 1.) demonstrate their commitment and 2.) acclimate to the specific duties of the new posting for which they’ve applied, all at no expense to the employer.

While this strategy would certainly work for some people, it obviously also wouldn’t work for others. At the end of the day, the same number of part time and full time positions exist, and whether or not any given applicant gets the ultimate position doesn’t change the fact that the prospective employer has gotten a free ride.

The logic would seem to hold that there shouldn’t be any guarantees in place for labor. If the market goes to pot, unemployment skyrockets, and wages plummet, then so be it. Surely we should advocate polices that create more jobs and try to reduce unemployment, but until that happens it would be unfair to deprive any given worker from the opportunity to willingly exploit themselves in order to gain any edge that might allow them to scrape past their similarly desperate competition.

The issue of on the job training is particularly relevant here because its a burden that employers have slowly started to try and place back on prospective employees, as well as community colleges and other institutions specializing in education and training programs aimed target at specific fields and career paths.

The result is a “skills shortage.” Or at least the appearance of one, bolstered by howls from the private sector about the impossibility of finding applicants with the increasingly unrealistic set of qualifications and skillsets demanded for extremely narrowly defined job openings.

This kind of thinking seeps into Yglesias’ analysis near the end, where he conflates the labor market problem with an educational one

Wage regulations are a poor tool for addressing the weak earnings power of inexperienced workers. Bad macroeconomic conditions give employers enormous leverage in the contemporary marketplace, but this is a problem for the Federal Reserve, not the Labor Department. If employers are forced to pay more, workers with no experience will be last in line for jobs and forced to buy more schooling as the only way to improve their qualifications. Young people will be worse off than ever, and all the tuition inflation and quality problems in American higher education exacerbated.

I’m not sure anyone being critical of the internship industry thinks that regulating it more rigorously will solve macroeconomic problems. The issue is simply that workers are being exploited, and without rules in place, or in this case without enforcing the rules that are already in place, the exploitation becomes widespread and leads to a prisoner’s dilemma of sorts.

As far as the macroeconomic problem: it’s jobs not education. There simply aren’t enough of them. Opening up opportunities for any individual to obtain better qualifications only helps that individual, and if everyone does it, it helps no one, because there are still the same number of people applying for the same limited number of jobs.

What it does result in is a credentialing race, and the public sector taking on more and more of the costs of training workers while the private sector unloads them. And I don’t think I’m alone in thinking that businesses aren’t about to advocate for higher effective corporate tax rates in order to pay for the expansion in community colleges and vocational schools.