Unpaid interns struggle to make ends meet

Months after graduating with honors from Northwestern University, Jeannie Vanasco began receiving food stamps and Medicaid. She had a full-time position at a prestigious literary magazine in New York City, but she was an unpaid intern.

"During my senior year, I thought there's no way I'll ever take an unpaid internship," says Ms. Vanasco, who depended on a full scholarship to attend college. But after looking at the paying alternatives, she reconsidered her pledge. "I knew I could get a paid job, but all of them seemed so dreary, and [publishing] is what I went to college for," explains Vanasco, a creative-writing major.

The problem was that most entry-level publishing positions were unpaid. To prepare for her internship, Vanasco spent the summer of 2006 working three jobs and lived in a "really disgusting apartment with all these filthy college boys." Despite her efforts, rent for the first few months consumed her savings. Not wanting to burden her mother, a librarian making minimum wage, she applied for government assistance.

Internships are steadily becoming – if not already – an institutionalized part of the college experience and a requisite for entry-level work. Though internships offer undeniable benefits, workplace experts are questioning the fairness of unpaid or extremely low-paying internships.

"Unpaid internships are certainly available or certainly commonplace," says Mark Oldman, coauthor of numerous internship guides and cofounder of Vault Inc., a career counseling company. According to a survey conducted by his firm last year, 36 percent of students said they were not paid for their internships.

Intern remuneration varies largely depending on the industry. Fields like computer programming or engineering are much more likely to offer interns compensation, sometimes in excess of $25 per hour.

"Glamour industries" such as television, publishing, and politics are notorious for offering unpaid or low-paying internships. In an article for Slate.com, Sonia Smith used the 2005 edition of the Princeton Review "Internship Bible" to calculate that 62 percent of television internships, 52 percent of magazine internships, and 54 percent of political and public-policy internships were unpaid.

There's a "certain amount of tradition or even hazing that goes on in these glamour positions," says Mr. Oldman. He argues that in fields like television, unpaid interns are equally as disadvantaged as entry-level employees. "If you want to break in at the entry level, you have to take a vow of poverty," he says.

Creating this kind of environment for interns troubles Gina Neff, a University of Washington assistant professor. She studies media industries, jobs in the new economy, and internships in the communications industry.

"I think there's a tendency to say, 'OK, kiddos, just suck it up!' " she says. "There is this sense that there needs to be great economic sacrifice to get to these kinds of jobs. Sadly, what it means is that you're locking out people who can't afford to work for free."

Reflecting on her experiences interning in publishing, Vanasco is bothered by the lack of diversity among her fellow interns and the publishing industry as a whole. "I don't think that everyone's white," she says. "It's more that everyone came from comfortable backgrounds."

In an effort to boost diversity, a number of universities and organizations have started offering young people internship stipends.

"The concept of finding funding to allow students to take unpaid internships is something that sort of caught fire nationally," says Kino Ruth, director of the Career Center at Hamilton College in Clinton, N.Y.

In three years, Hamilton went from offering one internship stipend to 30 and has plans to offer more.

Still, 40 percent of university communications departments polled by Ms. Neff reported that none of their unpaid internships offered stipends. "These [stipends] are a fantastic place to start," says Neff. "But I think it needs to come from companies who have a responsibility to these young people."

If companies in the United States paid every unpaid intern minimum wage, it would cost at most $124 million annually, estimates Anya Kamenetz, author of "Generation Debt," which characterizes student-loan debt as being at a tipping point.

Increasingly, companies are reevaluating the legality of maintaining unpaid interns. "More and more companies are not offering these [unpaid internships] because the boundary [between legal and illegal unpaid internships] is close," says John Challenger, CEO of Challenger, Gray & Christmas, an international outplacement firm.

According to the United States Fair Labor Standards Act, companies can employ unpaid interns provided – among other requirements – on-the-job training is for the benefit of the interns and companies receive no "immediate advantage." This means companies should not profit from an intern's work and in some cases training interns may even impede the companies day-to-day operations.

Unpaid interns in the US haven't tested the law recently, but last April in Germany unpaid interns organized a large-scale demonstration and an online petition calling for an end to unpaid internships. The German government posted the 40,000 signatures on its website, and Germany's Labor Minister at the time, Franz Müntefering, publicly condemned unpaid internships. The protests prompted the creation of Fair Company, an alliance of organizations that have committed to paying interns reasonable wages.

Given current trends, such an outcry among American interns is unlikely, says University of Washington's Neff. Because internships are so important to many students, Neff believes that students would not speak out for fear of damaging future career options.

"In the last five years, we've seen that students and their 'helicopter' parents have been homing in on internships ... as engines of career success," says Oldman. "Helicopter" parents are so-called because of their intense involvement in their children's lives – they tend to hover over them.

In 2006, 84 percent of college graduates said they'd completed at least one internship, paid or unpaid; 53 percent said they'd completed two or more internships; and only 1 percent said internships are not important, according to Vault's annual survey. Compare this with 1980, when only 3 percent of college graduates said they'd had an internship experience.

"One reason that companies can rely on unpaid internships is that people are lining up to do them," says Neff.

After graduating from New York University, aspiring comic Michael Feldman indirectly paid $1,600 so he could intern at "The Daily Show," a popular, satirical news show on cable TV.

"I really wanted to work at 'The Daily Show,' so I thought I'd start out there as an intern," says Mr. Feldman.

The program requires that all interns receive college credit. Feldman, who had just graduated in the spring of 2003, made a deal with NYU to earn the fewest credits possible, so he'd be eligible for the internship. That meant paying NYU $1,600 for credits he didn't need.

Through personal savings, help from his parents, part-time jobs, and free meals on the set, Feldman managed to make the internship work. And after four months as an unpaid intern, the show offered him a paid position.

Vault's Oldman remains optimistic about the potential of internships. "While there are less satisfying internships out there, the majority of them can provide a wonderful steppingstone to the career of your choice," he says. "Or, at the very least, it can help you weed out what you don't want to do."

Neff provides her students with cautionary advice. "Buyer beware: In terms of your time, savings, and the money you will need, you are buying an opportunity for your career. Make sure it's worth every penny that you invest."

Despite the hardships Vanasco faced, she believes her investment was worth the sacrifices. She now works as a research assistant for a prominent French philosopher, writes freelance book reviews, and still spends one day a week working as a reader for the publication where she interned.

She'd wanted to intern there "more than anything," she says in retrospect. "And I can't emphasize enough how delighted I am that I did. I've met so many poets, writers, and editors whom I've long admired, several of whom I now consider dear friends."