Over a quarter (27 per cent) of graduates are concerned they will miss out on job opportunities to those who can afford to do unpaid internships, research published yesterday has revealed.
The study by graduate jobs board Milkround also found more than half (55 per cent) of the almost 6,000 recent graduates interviewed believed an internship would help them secure a job.
However, almost two-thirds (65 per cent) were optimistic they would land a role in their dream industry.
Justin Madders, Labour MP for Ellesmere Port and Neston and chair of the All Party Parliamentary Group on Social Mobility, told People Management: “For too many careers there is an unwritten but near compulsory expectation that successful applicants to graduate entry jobs will have done a considerable amount of unpaid placements beforehand.
“I believe that for too many companies the lure of a job somewhere down the line is being used to persuade desperate youngsters to work for considerable periods of time for free with no guarantee of a job at the end of it. It’s exploitation and has to come to an end.”
According to research cited in a 2017 Institute of Public Policy Research (IPPR) report, nearly half of top graduate employers felt candidates without suitable work experience “have little or no chance of receiving a job offer” through their organisations’ graduate programmes, regardless of academic achievements.
Founder of The Sutton Trust Sir Peter Lampl added that not paying for internships, particularly those lasting long than four weeks, “prevents young people from low and moderate-income backgrounds from accessing jobs in some of the most desirable sectors such as journalism, fashion, the arts and politics”.
The Sutton Trust has calculated the cost of a six-month internship in London to be at least £6,603, or £6,114 if the cost of transport is covered.
Meanwhile, a 2011 YouGov poll found 40 per cent of those who had thought about applying for an internship had changed their minds because they were not able to work for free, while 39 per cent of those offered an internship turned it down for financial reasons.
Dr Wanda Wyporska, executive director of The Equality Trust, added internships paying less than the living wage – as set by the Living Wage Foundation – should be banned and “are a disgrace”.
She continued: “This behaviour exacerbates inequality by perpetuating a culture where those from well-off families gain valued experience and a foot in the door. It is also a very poor advert for those companies, which ought to be named and shamed.”
HM Revenue and Customs (HMRC) guidance advises that, if interns are carrying out work which is valuable to their employer and are working set hours, they qualify as employees and are entitled to the applicable minimum wage for their age group. However, those undertaking work experience as part of a university course or voluntarily for charity are exempt.
However, Georgina Brazier, jobs expert at Milkround, noted a trend towards companies offering more financial support to interns. “From help with accommodation to covering travel costs, this support is helping to level the playing field among those entering the workforce,” she said.
Brazier added that Milkround “does not work with companies who offer unpaid internships and we understand these roles are often not feasible for graduates looking to take their first step in a professional career”.
In February, the government vowed to crack down on unpaid internships, with more than 550 warning letters being sent to companies over a three-month period.