Life

The Companies Charging Graduates Up to £6,000 for Unpaid Internships

Businesses like Pave and The Intern Group are linking young people up with work placements – including virtual ones – for a pricey sum.
October 21, 2020, 8:30am
Office intern balancing cups of coffee
Photo: Tony Tallec / Alamy Stock Photo

One million. That’s the estimated number of young people that could be unemployed in the UK by 2021, according to the Institute for Public Policy Research (IPPR) think tank. It’s bleak news for the 800,000 young people who have left school or university this year – woefully dubbed the “COVID class of 2020” – who’ll be job-hunting alongside what’s set to be the highest number of unemployed young people on record.

But if there’s one thing we know from previous recessions, it’s that young people won’t all experience the economic downturn in the same way. Social mobility was reported to be in decline well before the pandemic. Entrenched inequality, combined with an already-stagnant entry-level job market, means that those from low socio-economic backgrounds will likely be hit hardest.

And what about the scramble for those coveted grad jobs? “When opportunities are scarce, it is those with the sharpest elbows who succeed,” writes Claire Maton, senior programme Manager of educational charity the Sutton Trust. The idea that wealthier graduates can use their financial and social capital to get ahead in life isn’t exactly groundbreaking. But how do supposedly meritocratic methods of graduate recruitment hold up in a recession? Are there hidden routes to getting ahead? Is it possible to effectively spend your way into a grad job today?

“I found that a lot of employers don't really look at your CV with much attention unless you have experience already,” says Ben, a campaign assistant for a London-based marketing company. In 2019, he paid over £6,000 to undertake a three-month unpaid marketing internship with a software development company in Melbourne, organised by The Intern Group, a global internship company. While accommodation is included in the price (flights are not), a significant chunk of the fee goes towards facilitating the unpaid placement. 

Ben credits the experience with being instrumental for landing his current role. “When I was looking for a job before the internship, I barely got any calls from recruiters. After I did the internship, I was going on maybe two interviews a week.”

Unpaid internships are nothing new, and they already come with a hefty price tag. The living cost of undertaking an unpaid internship in London is estimated to be £1,093 per month. So why would you opt to pay significantly more to a private company to work for free? According to Oxford grad Beth, it’s one way of standing out in an ever-crowded job market, particularly in a competitive industry like journalism.

In 2017, Beth paid over £2,500 (including flights) to undertake a month-long journalism placement in Calcutta with internship company Pave. She carried out on-the-ground reporting that she believes was a highly valuable experience. “I feel like there wouldn't have been that level of delegation of responsibility [from a UK-based internship].

Beth says the placement helped further her journalism career, but has “mixed feelings” about the impact of these internships on social mobility. “It’s a barrier to entry for lots of people. And so I recognise my own privilege in the sense that I could afford to do that,” she tells me.

Pave and The Intern Group are amongst a handful of companies that have long been charging UK-based students and grads thousands of pounds to do unpaid internships abroad, the latter claiming that 88 percent of their alumni find graduate-level employment three months after completing their programme. After all, gaining relevant experience has always been key to landing top grad roles – why else would students slog it out at summer internships? 

Now that coronavirus has forced at least 61 percent of employers to cancel some or all of those crucial work experience placements, private companies have raced to plug the gap. Today, you can do an unpaid virtual internship from the comfort of your own home, with The Intern Group charging upwards of £2,292 for the privilege. This virtual programme had, astonishingly, been promoted to anxious, job-hunting students by institutions like University of Essex and University of Sunderland during lockdown – and that’s not to mention The Intern Group’s ongoing partnerships with many of the UK’s top unis.

There’s evidence to suggest that unpaid internships thrive during recessions, which could be a devastating blow for social mobility. “Some employers might use unpaid internships to supplement their paid workforce and make up for the work that they're not paying to do anymore,” explains Dr Rebecca Montacute, the research and policy manager at the Sutton Trust. 

Montacute believes virtual internships in themselves could be a pracical solution to cancelled placements. “The thing with virtual [internships] is that you have quite a lot of opportunity to actually open up access for students,” she explains. “However, we [the Sutton Trust] think that they should always be paid, because even if you don't have to move to another city to be able to do them, not everyone can stay with their families.” 

And what if they’re unpaid (or indeed paid-for)? “What we definitely know from our own research is that unpaid internships will lock out people from those opportunities,” she says.

Aside from gaining that all-important experience, the ultimate goal for most grads is to land a full-time role in their chosen field. But what happens when there isn’t a clear career roadmap to follow – particularly now that we’re in a recession? For some grads, the solution has been to pay for bespoke career coaching. 

Anushae, who felt “stuck” after graduating from a business school Masters in 2018, paid £1,597 to undertake a one-to-one graduate career coaching programme with the company Seven. “I definitely think [career coaching] is important for more competitive industries, especially when people don't really know how to get into them,” she says, explaining that her coach helped her find alternative ways to enter advertising. “She taught me about the importance of networking. And that's how I got my current role – through networking.”

Networking is a vital skill for career advancement, but it can also be an intimidating prospect for young people from low socio-economic backgrounds – particularly as coronavirus has made it more logistically challenging. Not only might working-class young people lack an understanding of the “behavioural codes that dominate top professions”, as journalist Amol Rajan puts it, but they might also lack the necessary “polish” to get ahead. 

This “polish,” which is what Rajan defines as the “crucial quality of articulacy and presentational confidence that academics have noticed is vital in client-facing roles,” is highlighted as a major obstacle to social mobility in his 2019 BBC documentary How To break Into the Elite.

When I speak to Chris Davies, founder of graduate coaching company Graduate Coach, he tells me that demand for his services is at a 10-year high. He coaches graduates on application and interview technique, but thinks the idea that “polish” is needed to get ahead is “rubbish”. 

“It is quite meritocratic, getting a job nowadays, in the sense that the best qualified person will get the job,” he tells me. Is it fair to say that the person with the most resources will get the job? “No. It is the person with the most resolve, the most determination,” he insists.

Unfortunately, research from previous recessions suggests that determination alone doesn’t always pay off. “When there are fewer opportunities, it does tend to be those with resources and connections who still manage to get access to the limited number of opportunities that there are,” says Montacute.

What’s more, the specific conditions created by the economic downturn may only serve to exacerbate this problem. The Sutton Trust has proposed solutions for addressing this disparity: A free, high-quality national career service, a recommendation that employers top up the wages of young people on the Kickstart scheme from the National Minimum Wage to the Real Living Wage and a ban on unpaid internships over four weeks – but we’re yet to see the government and employers formally commit to these changes.

But this is just the start. The more we demand honest discussions about class, social mobility and access to the workplace, the closer we get to building a more equal society – one in which access to resources doesn’t dictate access to opportunities.