Student bodies and employability organisations have always believed that unpaid internships were bad for students and bad for the economy. Until the end of July, there was very little evidence to demonstrate just how damaging they were to students’ career prospects. Now, a report called Access to and Returns from Unpaid Graduate Internships has blown many of these claims wide open.
The Damning Report
The report found that those from the highest and lowest-earning families favoured internships. The former perhaps have the financial buffer to afford it whereas the latter feel it’s the only way to break into their industry or career choice. The shocking finding in the report from Institute for Social and Economic Research based at the University of Essex included evidence that:
- Students accepted onto unpaid internship schemes some three and a half years later earn £3,500 less than students who enter paid work
- Students accepted onto unpaid internship schemes some three and a half years later earn £1,500 less than students who go onto further study
- The average salary difference between students on unpaid internships and those entering paid work was an average of £2,000
- While students on unpaid internships and coming from disadvantaged backgrounds were some £4,000 worse off
- Students on unpaid internships were unlikely to be considered for executive or management roles
This points to not just the lack of genuine opportunity for students but brings into question the value of unpaid internships in general terms. We know that they benefit businesses taking advantage of skills and services of graduates who are not paying the interns. Students are lured with the promise of a lucrative job at the end, but these rarely materialise.
Unpaid Internships Used as Proverbial “Carrot”
The long-held belief that students who apply for unpaid internships are at an advantage and will have many more doors open to them is now clearly a myth. We also now have stark evidence that they are also counterproductive to graduate job and career prospects. Between 2007 (just before the financial crash) to 2011 (one year after the Tory-LibDem coalition at the heart of the crash), use of graduates as interns increased from 0.5% to 1.5%.
Why are they so popular? Employers across the board expect and demand on-the-job experience, something that the majority of students do not have unless work experience comes as part of their degrees. The internship system has served many students well over the years, helping them gain contacts and experience while they were still in a course of study. The problem is that businesses are no longer just taking on undergraduates – they are filling their internship gaps with graduates desperate for the experience of getting a foot in the door.