Why Are Unpaid Internships Still Happening?
Forbes Advisor
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A Note From Patricia:
Hello and welcome to Forbes Advisor’s Weekly Brief, where each week, we dive into the realities of consumer finance and empower you with knowledge to help make your financial journey easier.
Completing an internship is a crucial step in your career path. It offers access to skills and professional networks and can be a direct avenue to a full-time job offer.?
But despite interns having defined roles and responsibilities, some of them still aren’t paid for their contributions. Every year, about one million students in the U.S. accept unpaid internships, oftentimes because they can’t find a paid opportunity in their desired industry.
This creates a significant financial barrier to these career opportunities for many and perpetuates inequality.?
In this week’s brief, we’ll discuss unpaid internships and offer financial tips for unpaid interns struggling to stay above water with their finances.
Sincerely,
Patricia Louis
Editor, Forbes Advisor
Why Are Unpaid Internships Still Happening?
Many colleges and universities require students to complete an internship to earn their degree, forcing some students to accept an unpaid internship out of necessity. But this may put them at a disadvantage. Research shows those who participate in paid internships receive more job offers and earn higher starting salaries than those who participate in unpaid internships.
There’s also a long history of lawsuits contesting the lawfulness of unpaid internships.?
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One of the most famous occurred in 2011 when two interns sued Fox Searchlight , alleging that their internship violated the Fair Labor Standards Act (FLSA) by not compensating them for work that a paid employee would have otherwise performed. The courts ruled in favor of the interns, and this litigation later sparked multimillion-dollar settlements for interns at other major companies, all of which now pay interns.?
Unpaid internships are clearly a problem that disproportionately benefit those who can afford to participate—so why are they still happening?
The FLSA requires for-profit employees be compensated for their work, but interns are often not categorized as employees, and may receive academic credit in lieu of wages.?
The question of whether or not this is fair remains and organizations like NACE are calling for federal action and policy reform as a result.
In 2021, the Biden administration issued an executive order seeking to “increase the availability of paid internships, fellowships, and apprenticeships and reduce the practice of hiring interns, fellows, and apprentices who are unpaid” within the federal workforce.?
However, despite another 2023 guide, there has been little evidence of progress. For example, the Securities and Exchange Commission announced that its SEC Scholars Program would pay students in 2022—but backtracked in 2024 and updated its website to state that the fall 2024 program would be unpaid.?
If you’re in the midst of an unpaid internship and are struggling to stay above water, there are a few things you can do.
Reach out to your school’s career center: Some colleges offer scholarships, stipends or other programs to help support students with unpaid or low-income internships. There may even be scholarships specific to your field or state for which you might be eligible.?
Work a part-time job: Taking an extra part-time job during the school year to save up for a summer internship can relieve some of the financial burden. However, it’s important to avoid burnout. Balancing a job and your schoolwork at the same time can be difficult and stressful, so it’s important to manage your hours and priorities accordingly.??
Consider remote opportunities: Applying for remote and hybrid internships can reduce transportation and other costs. Fortunately, since the pandemic, the number of online opportunities has increased. In 2019, an average of just 5% of internships allowed for work from home; fast forward to 2023, and according to the National Survey of College Internships 2023 Report from Strada, nearly 20% of interns completed online internships.?
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Most certainly engineered for success (thank you mom and dad); Innovative by pure design.
3 个月on the part of the intern where are volunteership request letters for minimum wage; if people of caliber dont want to enter the corporate space as their internship brand why is there a question of payment not personal long term investment. a question that is very private. why on the responsibility of ‘employers’ is there not a question of how honest to build foundation and allegiance. Federally honored internships can include apprenticeship license and the maintenance of internship requires subcorp B structure;that someone be paid.
Paid internships don't differ much on the unpaid ones. Maybe there's a difference in a F(b)ridge or two, but not a real salary perse. Besides, the ones who really enjoyed interships, were the ones who had the instalations all along. And the bridges? They were there like some Broadband necessity. Usually the ones who really have an payed internship, are the ones who didn't lived within the instalations, but were working for them. That's the difference, that's what makes it so hard to accept for the ones who aren't getting the paid benefit. I've worked for remote jobs a really long time, most of them, unpaid and without any instalation benefit more than the ones who lived in pre-housing university programs. But when you really get the chance to get some difference, the ones who were there all along start getting itchy and bitter. That's why you either start making some stupid arrangements for the ones who were already there, or just make them counstious on your background. Wich can be a nuisance too.