The rise of unpaid internships are not just about the economy. They appear to be a now permanent fixture of the “new normal”

In the first installment of SkilledUp’s special report, we reviewed the Fair Labor Standards Act of 1938, which sets guidelines for what is and isn’t legal in the world of unpaid interns. Today, we’ll answer the basic question- who’s hiring unpaid interns? Our research surprised us, and indicates what entry-level employment might look like in the future.

Part 1: A Stupid Law
Part 2: Not the Economy
Part 3: Freelancing & Freemium
Part 4: Long Term Effects

Unpaid internships are notoriously hard to measure, with no paperwork in many or even most cases. However, data compiled by the Bureau of Labor statistics, when compared to data from Interbridge.com helps shed light on some of the shifts that we can verify through hard data.

As one would expect, unpaid internships have become more prevalent in those industries facing dire economic situations.  For example, the publishing industry, which has been losing jobs for the past ten years, saw 10% fewer interns receive compensation in 2010 than in 2009.

However, unpaid internships have increased dramatically even in industries that have performed relatively well in recent years. For example, healthcare consulting, which CNN expects to be a position with 24% growth over the next ten years, compensated 22.6% fewer of its interns in 2010 than it did in 2009. Information Management, which the BLS predicts will enjoy an 18% growth over the next ten years, saw the share of compensated interns decrease by 21.7%. These industries still maintain robust margins and the ability to pass costs on to customers – yet they too are reducing their overall compensation to entry-level workers.

Even industries like Information Technology, which are growing faster than the rest of the economy, are using more unpaid interns than ever before.

Corollary to this increase in unpaid internships is an increase in “payment” by way of college credit- 17.6% more healthcare consulting interns received credit in 2010 than in ’09. Information Management and other growth sectors, including all areas of finance, report similar numbers.

These numbers help to partially refute the idea that unpaid internships are a temporary byproduct of a weak economy. The fact that industries with increased labor demand are increasing their use of unpaid internships leads us to the conclusion that the unpaid internship is not merely a byproduct of a lagging economy in which businesses cannot afford to pay their entry-level employees. Rather, it’s a facet of the workforce that’s here to stay, even in those industries that are expecting to see rapid growth in the next decade.

So if the economy isn’t the (only) cause of the rise in unpaid internships, then what is? We’ll try to answer that question in the next installment.