Germany pays its interns. Why can’t the US?

The skeptics got one thing right. The new German minimum wage law, extended to cover interns, has reduced the stock of available internships. There are no data yet — the law went into effect on Jan. 1 — but there are plenty of stories like the one Niklas Schoppmann tells of losing his internship at a hospital outside Dusseldorf because his employer chose not to pay him the required 8.50 euros an hour.

A similar loss of “opportunity” occurred in the U.S. in the 1920s and 1930s. The passage of several state and federal laws culminating in the 1938 Fair Labor Standards Act stripped minors of the right to sell their labor, threatening to send families who were dependent on their children’s wages into an even darker corner of poverty. Prominent figures such as Sen. William H. King of Utah warned that that the reform was really a “scheme of the Bolsheviks to have the state take charge of the children.”

But the wound eventually healed. Factories were forced to hire adults, while children were required to go to school. Though socialists really were behind the reform, 77 years later it is no longer radical to say that keeping 10-year-olds off the assembly line enhances — rather than restricts — their freedom.

A global transition away from free intern labor will have a similar effect on jobseekers who have no alternative to working at a company for free in exchange for a line on their resume. Many employers, of course, would rather cut their internship programs than pay their interns. Responding to the opposition’s warning that it may reduce the availability of internships, German Member of Parliament Matthias Bartke told In These Times, “That’s probably not very wrong, but we didn’t see any other possibility to solve the problem.”

But in the long term, downsizing the intern armies will help even the desperately unemployed. According to the German magazine Gründerszene, the dating website eDarling and the online clothing retailer Zalando have already replaced some internships with more stable paid positions such as apprenticeships and entry-level jobs to compensate for the staffing gap. A representative for Zalando told the magazine that the company now has to “carefully consider” whether any of its internships make sense if it has to pay minimum wage. The fact that before the law passed, Zalando did not consider how it makes use of several months of a young person’s life suggests the attitude that most companies have toward interns.

The past few decades have witnessed the explosion of knowledge work and the loosening of employer obligations to their workers. Internships are a product of this trend, and the modern company has become hooked. As Ross Perlin writes in his 2012 book “Intern Nation,” the move has shifted a significant financial burden to the worker by “transitioning from training programs and entry-level jobs to internships.” In exchange, young workers earn vague, nonmonetary rewards such as experience and contacts — social capital that was once conferred on apprentices or new hires in addition to rather than in place of wages.

Unpaid labor, like child labor, is a resource that developed countries have no valid reason to use. Technically, the U.S. has a law protecting interns, but it is antiquated (unlike in Germany, in the U.S. there is no legal definition of “intern,” only “trainee”), is feebly framed and is rarely enforced. By sanctioning unpaid internships in the for-profit sector if they meet certain subjective criteria, the U.S. effectively puts the onus on interns to prove in court that they were treated like employees.

As any intern can tell you, violation of these supposed rules is the norm. Hardly any internship meets the requirements that “the employer … derives no immediate advantage from the activities of the intern” and that “the intern does not displace regular employees but works under close supervision of existing staff.” Startups, law firms, magazines and film studios rely openly on interns for data entry, research, fact checking and coffee refills — work that would otherwise necessitate larger staffs. According to legal observers like Maurice Pianko, “unpaid internships in the for-profit sector are almost always illegal.”

Several lawsuits, including the high-profile case concerning the use of interns in the filming of “Black Swan,” have validated Pianko’s grim outlook. But no amount of litigation will tackle such an enormous problem. The work of U.S. interns accounts for $2 billion in unpaid wages annually, according to Perlin’s estimate. In effect, interns are paying to work, spending their own money on rent, transportation and food — and usually at big-city prices. It’s a cost that excludes much of the working class from the job market.

The U.S. needs to follow Germany’s lead in regulating intern labor. But Congress should aim to outdo the Bundestag. The German law has purportedly eliminated the standard postgraduate unpaid internship, since interns with a degree appropriate for their fields are entitled to earn the minimum wage. But the law leaves too many potential loopholes for companies looking for free labor: Interns who are receiving university credit, are under the age of 18 or are suffering from long-term unemployment need not be paid. There’s also an exemption for most internships that last only three months, which may simply become a new bar to squeeze under. In this respect, Labor Minister Andrea Nahles’ proud declaration that “Generation Praktikum [internship] is history” was premature.

All the same, the German law challenges the fallacy that unpaid internships are an opportunity, as if this artificial pay-to-play arena, created by capitalism in the last generation or so, were the only possible way to exchange ideas about how work is done and who is best to do it. If employers want to have this kind of exchange for the sake of efficiency, let them pay the entry fee.

Cautionary tales about ambitious young minds thwarted in the pursuit of their dream job because they no longer have the right to work for free miss the mark. They have nothing to say about mass unemployment, vast inequality and economic insecurity — problems that disquiet so many young minds and that can be solved only by ending exploitive relationships. Eliminating unpaid internships is a start.