GRADUATE INTERNSHIPS: FIRST STEP UP THE LADDER OR BLATANT EXPLOITATION?
According to Harold Geneen, former President of the American multinational company ITT: “In the business world, everyone is paid in two coins: Experience and Cash”. Get the first, he declared, and the second is sure to follow. On 1st July, the Higher Education Statistics Agency (HESA) published its annual analysis, indicating that around 290,000 “UK-domiciled students” (ie: not including those from abroad) will graduate from British universities and colleges over the next few weeks. Based on the figures for last year, approximately 13.5% of these will try for an additional qualification (such as an MA, MSc, PGCE or PhD) and 8.3% will take time off to do something different – for example, travelling. Most, however, will hope to obtain employment. Their prospects are, in the opinion of the Association of Graduate Recruiter’s (AGR) Chief Executive, Carl Gilleard, “very encouraging”: His association has predicted (in its survey released on June 28th) that graduate vacancies will increase by 2.6% and the average starting salary will rise by 2% to £25,000 during 2011. The outspoken website “Graduate Fog” is unconvinced by Gilleard’s “cautious optimism” and instead points to the fact (confirmed by the AGR) that there are now 83 applicants for every graduate job – compared to 69 in 2010, 49 in 2009 and 31 in 2008. This demonstrates, it says, “what is really happening to graduates when they leave university”, namely that they are struggling to find proper permanent jobs (or any at all) and that there are only “unpaid internships which promise to lead to work – but somehow never do”. Sean Coughlin, the BBC News education correspondent, has reported that although the jobs market for university leavers is showing signs of improvement, it remains “ highly competitive” – especially for graduates who have no work experience and thus (as emphasised by Martin Birchall, Managing Director of “High Fliers Research”) “have little or no chance of landing a well-paid job with a leading employer, irrespective of the university they’ve attended or the results they’ve achieved”.
A third of the “entry-level positions” with theUK’s top companies (& half in the case of law firms and the investment banking sector) are expected to be filled this year by recruits who already have a link with the organization to which they are applying. Nonetheless, Dr Charlie Ball, Deputy Director of Research at the Higher Education Careers Services Unit (HECSU) considers the job situation to be better than at the same point in previous recessions and not as bad as a lot of people believe. Also that –despite the difficult labour market – a large majority of graduates will obtain jobs within six months and “settle into their chosen careers further down the line”. He acknowledges, however, that the economic downturn has provided many businesses in theUK(17% is the latest estimate by “Internocracy”) with a somewhat dubious justification for using unpaid interns as cheap labour. This is a controversial issue in which the leaders ofBritain’s three main parties have recently all become embroiled. In April, the Liberal Democrat Leader & Deputy Prime Minister, Nick Clegg, launched the Coalition Government’s “social mobility initiative”. He was quoted on “Internship News” as asserting that he wanted a society “ in which success is based on what you know, not who you know”, that internships should be open to everyone (not just the “well-connected”) and employers would be expected to provide their interns with some kind of financial support . Clegg was subsequently excoriated by the media (notably the “Daily Mail”) when he admitted in Parliament that as a teenager, he had obtained an internship through acquaintances of his father. His stance was then further undermined and contradicted by the Prime Minister, David Cameron, who told the “Daily Telegraph” that he was “very relaxed” about the culture of internships and would even be providing one of his neighbours with a placement in his office. Meanwhile , the Labour Party Leader, Ed Milliband, has been criticised by his own supporters for apparently having reneged on the commitment he made during the 2010 leadership contest to “campaign for the Minimum Wage Act to be fully enforced so that employers (including Members of Parliament) must pay their interns what they are due.”
As a result of the growing furore, the Government has now instructed the Low Pay Commission (LPC) to look into the situation – a decision welcomed by TUC (Trades Union Congress) General Secretary Brendan Barber. The LPC itself has already recommended that HM Revenue & Customs should take stronger action to force employers to observe NMW regulations. From 1st October 2011, the adult minimum wage will change to £6.08 per hour (+ 15p), for 18-20-year-olds to £4.98 ph (+ 6p) and for 16-17 year olds to £3.68 ph (+4p). The hourly rate for apprentices will rise to £2.60p (+10p) – the minimum amount (as disclosed by People Management Magazine) that the Chartered Institute Of Personnel and Management (CIPD) have suggested should also be applied to interns. “Management Today” has described the debate on unpaid internships as the “hot political topic” of the moment, contending that current procedures “arguably favour the wealthy” and quoting an investigation by the Unite Union which discovered that of the 450 interns in Parliament, just under 50% do not receive food or travel expenses. It also referred to the embarrassing occasion (for the Government) earlier this year when internships to City firms were auctioned for a fee of £3000 each at the Conservative Party annual gala.
This, however, is nothing new:Scotland’s Sunday Herald newspaper has claimed that EdinburghUniversitymakes £222,400 annually by charging £5000 for students seeking work placements with the Scottish Parliament. The “Daily Mail” has depicted university leavers as so desperate for employment that “some are actually paying thousands of pounds for the privilege”. The Director of Oxford University’s career service, Jonathan Black, has expressed concern about the growth in companies trying to make money from internships, levying fees of up to £1000 for “introductory letters”. “Graduate Fog” highlights what it views as the most brazen instances of alleged internship exploitation. Among recent cases: The National Trust’s advertisement for an unpaid intern to be their “Internship Programme Coordinator” (ie: to encourage other interns to work for them unpaid); The Centre for Social Justice offer of an 22-month internship (travel expenses only); Labour MP Lyn Brown, who purports to “campaign tirelessly for a living wage for all” is seeking a “voluntary Westminster worker” (no lunch or food expenses). Perhaps most incongruous of all: The London office of The Africa Governance Initiative (AGI) run by ex-Prime Minister Tony Blair (who implemented the NMW in 1998) requires an intern with “excellent academic credentials, proven administrative & numerical ability, proficiency in Excel, ideally with prior experience in an office environment”. AGI insist that they “do not have the funds to pay volunteers for a role not vital to the organization”. The reaction of “Ground Fog” ? “Nowadays, it seems you have to be rich to afford the luxury of working for a charity”.
COLIN GORDON