“Cheap labor”, a.k.a. the intern

The Onion once again nails it with a funny piece about internships:

In tough economic times, employers relish the term, “cheap labor,” a.k.a. the intern. Full of vigor and promise, the intern works hard for little or no money.

Oh wait, it’s not The Onion, it’s AdvertisingAge. Not funny.

Happy to work for free

Here’s an illustration of why unfair internships thrive as potential employees are weakened. From The Daily Princetonian:

The recession is also boosting the applicant pool at FG Companies, a small boutique investment bank in New York that only offers unpaid internships, said Kai Chan GS ’04, an associate at the firm. “[The downturn] is great for guys like us, honestly, because we’re finding a lot of people who are saying, ‘Yeah, we’re happy to work for you for free,’ ” Chan said. “I noticed last year when we did interviews and said, ‘Just to be clear, this is an unpaid internship,’ some people were wavering,” Chan explained. “This year, when I explicitly start off the interview saying it’s an unpaid internship, they’re fine with that, and just say, ‘Let’s proceed.’ ”

This is the reason why unfair internships are illegal: because they are the consequence of the weak negotiation position of potential interns – exploitive, in other words. Those have no choice but to lower and lower their requirements to even gain experience. The good news is that there is a solution: collective action through legislation. And it already happened: unfair internships are illegal.

Economic crisis, internships crisis

The economic crisis is becoming the angle for most of the news coverage and that about internships receives the same treatment. Even the student newspaper of the Harvard Kennedy School is worried. This blog will add a category to track its posting related to this topic.

The fact remains: unfair internships are illegal, crisis or not.

Turning to internships during the economic crisis

Some more evidence that the practice of unfair internships may worsen under the current economic crisis.

Steinfeld said the media and brokerage firms are among those using unpaid interns sometimes with the promise of future jobs.”They always had paid internships,” said Steinfeld, referring to the brokerage firms. All of a sudden, in this economy, there are big-name firms saying ‘if you want into this business, you’ll have to work for free doing cold calling,’” he said.

The practice remains illegal nevertheless.

Even after graduation, some work as unpaid “interns” in situations that violate state labor laws. State Labor Department spokesman Leo Rosales said students may only work for free if they get school credit. After graduation, the minimum $7.15 hourly wage is required.

How can the financial crisis benefit internships?

If internships are done according to the law,”the employer provides the training and derives no immediate advantage from the activities of the student”. You would expect that during a recession, employers can’t afford to train interns while cutting off staff. Then how can it be that we ran into this quote in the Columbia Spectator:

“As there are fewer jobs to go around, there are more internships available”

Because unfair internships are un(der)paid jobs, not proper trainings, that’s why. And since students compete against each other to enter the job market, they are even more desperate these days and will lower their standards.

As jobs become more scarce, the importance of internships seems to have grown, as applicants feel a greater need to polish their resumes. “I see students who feel that one internship is not enough.”

And once everybody has their two internships, this will become “two is not enough” and then three. Where will it stop?

Unfair internships are a large-scale illegal practice hidden in plain sight.