Tuesday, May 30, 2006

Internships: Pay Them or Leave Them?

by Ken Houghton

The $124MM Question

Spent the non-writing part of the weekend moving the aforementioned wife's cousin into her summer housing and hosting relatives and others.

Part of the discussion on the way in was how she ended up interning at Columbia Journalism Review. She noted that of the places to which she applied, only a few were paid at all, and only three got back to her. CJR was one that fit both categories.

For instance, The American Prospect, which was one of the places that replied, does not pay its interns. (Which didn't keep Garance Franke-Ruta from noting and promoting the piece--nor, I hasten to note, should it have.)

But the key question is obscured by Kamenetz's linking it to union activity:
How are twentysomethings ever going to win back health benefits and pension plans when they learn to be grateful to work for nothing?

Make no mistake: I quite agree that even more workers would not have pension plans or health benefits if not for unions. But if 7/8 of workers are not unionized, the fault lies not in the union. Pension plans and health care benefits are basic Coasian economics: is it never optimal to manage social costs on an individual level.

Her roommate for the summer is interning at VH1. Viacom is not paying its interns anything. Kamenetz notes:
The Bureau of Labor Statistics does not identify interns or track the economic impact of unpaid internships. But we can do a quick-and-dirty calculation: according to Princeton Review's "Internship Bible," there were 100,000 internship positions in 2005. Let's assume that out of those, 50,000 unpaid interns are employed full time for 12 weeks each summer at an average minimum wage of $5.15 an hour. That's a nearly $124 million yearly contribution to the welfare of corporate America.

One person pooh-poohs this amount in the TAPped comments. And since Viacom's net earnings for 2005 alone were more than 10 times that amount, he's not incorrect that this isn't a major savings or (as I noted above) that it isn't the greatest use of union resources.

The question is more whether it's a good use of the interns, and there Kamenetz is on firm ground:
A 1998 survey of nearly 700 employers by the Institute on Education and the Economy at Columbia University's Teachers College found: "Compared to unpaid internships, paid placements are strongest on all measures of internship quality. The quality measures are also higher for those firms who intend to hire their interns." This shouldn't be too surprising — getting hired and getting paid are what work, in the real world, is all about. [emphasis, link to survey mine]

Employers who pay their interns have much more positive views about their interns than employers who don’t pay. Indeed, on average, employers who pay report that the interns have better attendance, reliability, and attitude than the alternative workers.[emphasis mine]

So for at least the past six or seven years, people taking unpaid internships have been able to know that the employee doesn't think much of them. Eventually, in a rational world, the Viacoms and American Prospects of the world would stop getting intern applications. Fortunately for them, that time has not yet come.
I find in interesting that Franke-Ruta cut her teeth (or whatever that expression is) at The New Republic... which does pay its interns (although admittedly not much).
It has been an issue among the younger libDem types (e.g., Pandagon back when it was Jesse/Ezra, Yglesias) that the conservatives have had funded internships for years, which gives them a leg up. (Not a whole leg; you still have to be close to Yglesias-rich to afford to take an internship, especially if it's not in your home city.)
I'd agree with the young libs that the VRWC's institutional apparatus is better-developed (and left-of-center analogues like CAP sometimes need to think bigger). At the risk of promoting an unfair stereotype, we do have "graduate schools," but even comparatively policy-oriented programs such as mine (UMCP economics, early 1990s) aren't that well tuned to producing working wonks -- of any persuasion, really.
It isn't entirely true that the vast left wing conspiracy is underfunded. See, for example, Everett Public Service Internships. I'm interning at a liberal think tank in DC (CBPP, if you must know) that pays me as much as Heritage paid my friend last summer (though far less than Goldman Sachs is paying her this summer!), and it offers its interns health insurance. Though $3000 for 10 weeks is really not sufficient to get by on if one has to pay for everything. Luckily, I have family in DC and so can room for free.

I'm with Ezra Klein: the class biased nature of internships is what should really trouble you. And not some other claim about how liberals are more or less well-funded or...Class even matters in that internships in DC are apparently either places that hire only GW students, or places that hire only Harvard/Yale/etc. students. I'd suspect that the paid internships tend to hire the latter cut (mine heads in that direction) and those places, of course, tend to have class issues in the initial selection.
Isaac: I agree wholeheartedly on the class bias issue.

I don't think the Everett program is comparable to Heritage -- or even what you're doing at CBPP -- as Heritage exists to produce and perpetuate the VRWC first and foremost. Even CAP doesn't go out on a limb and pound what by present standards are far-lefty ideas until they start to stick.
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