Monday, July 05, 2010

Yet another way that the Obama administration is mucking up things for the rest of us

The NYT ran a story this week about how the Obama administration's determination to crack down on unpaid internships has had the effect of depriving young students of valuable work experience. For years, college students have gotten work experience working as unpaid interns for various businesses and organizations. They were willing to trade their time for those opportunities. I've known so many of my former students who shelled out the money to spend the summer in Washington or New York or elsewhere for the opportunity to get some real world experience to help them build up a resume that would make them more employable when they left school.

But the Obama administration decided that this just wasn't right and exploited young people and was unfair for those young people who couldn't afford to take an unpaid position so they issued new guidelines warning businesses about taking on unpaid interns.
In April, the Obama administration issued a fact sheet listing six criteria aimed at preventing employers from violating the Fair Labor Standards Act with their unpaid internship programs. Among the stipulations: that the training the intern receives must be similar to training that can be obtained in an educational setting, that unpaid interns don’t displace a paid employee, and that the employer does not derive any “benefit” from the intern’s work.

The guidelines, from the Labor Department, have left employers scrambling to bulletproof their internship programs, said Camille Olson, a management-side employment attorney, who represents companies who have been dealing with this issue. Some employers, she said, have converted to paid internships but in the process have cut back on the number of posts they can offer. Others have abandoned their programs altogether.
So now these young people are left without those opportunities. And they can't find a pay job either. Finding the typical summer job that high school kids used to do every year has become more and more rare as businesses have to cut back. So they can't get paid or unpaid jobs. And if they want to try to get college credit so they can fulfill that requirement, they end up having to pay to get that credit. So not only are they unpaid and having to pay for their housing, they also have to shell out up to thousands of dollars to the university in order to get the credit that allows them to work as an unpaid intern.
Most employers aren’t entirely eliminating their unpaid internship programs but are instead becoming sticklers, requiring that schools grant credit to any person they hire for an unpaid internship. That can be difficult for some students. Alyssa Wolice, a journalism major at American University in Washington, had to walk away from three promising internship opportunities — one at a sports organization and two at news organizations — because all three employers insisted she obtain credit from her university.

There were two problems with that stipulation for Ms. Wolice. First, she had already been granted the maximum number of credits that American allows for internships in her degree program. But even if she hadn’t, she says she couldn’t afford the estimated $1,000 she would have had to pay American for the credits.
It's going to be tough enough for these kids to graduate from college and find a job but now they won't even have a summer or two of real-world experience to add to their resume.

The only ones who might benefit are the community colleges that figure out a way to give the credit while undercutting the cost there would be for the students to pay at their regular college for the opportunity to work for free.

So Obama's Labor Department came up with a solution in search of a problem that ended up making things worse for everyone involved. Does this story sound familiar?