Silicon Valley Interns Make a Service Worker’s Yearly Salary In Three Months
Six-figure salaries. Flexible hours. Luxury housing. Ah, the life of an intern.
This past weekend, high school senior Tiffany Zhong, the chief product officer of the app Glimpse and one of the tech industry’s “55 Unknown Rock Stars” according to investor Marc Andreessen, shared a list of top internship offers for aspiring software engineers looking for work at major tech firms. The numbers are staggering: an intern at companies like Google, Facebook, Apple, or LinkedIn can make anywhere between $6,000 and $10,000 a month, not including sizable housing stipends built to match the skyrocketing cost of living in places like San Francisco, where the median price of a home recently passed $1 million.
Ms. Zhong’s informally compiled list is more or less confirmed by the website Glassdoor, a job search website that also tracks anonymously reported salaries and wages. Glassdoor estimates that a software engineering intern at Google makes between $6,000 and $7,000 per month or, if paid hourly, over $40 an hour. The income of a software engineering intern at Facebook is comparable, with monthly incomes of over $6,500. By comparison, the poor kids over at Apple reportedly have to make do with a measly $35 an hour, barely enough to buy a brand new iPhone 6 everyday. If that doesn’t sound so bad, think of the teasing they’ll have to put up with from their friends over at Dropbox who could rake in over $8,000 a month.
At first glance, it might be tempting to interpret this extravagant level of compensation as a victory for the once-humble intern. Unpaid internships in for-profit companies are increasingly coming under fire in the wake of a 2013 ruling from a New York federal district judge, which found that Fox Searchlight’s unpaid internships violated federal minimum wage laws. And across the board, courts are tightening up their enforcement of the Fair Labor Standards Act, which deems unpaid internships illegal if they provide any “immediate advantage” to the employer. As Jordan Weissmann suggests on Slate, perhaps “we should celebrate the fact that tech companies are paying their interns in line with normal employees.”
But in the specific context of the tech industry, inflated intern salaries are a painful indication of the ever-widening gap between the way that Silicon Valley treats its young talent and the way it treats everyone else. Indeed, the figures shared by Zhong and listed on Glassdoor are astronomical, but they are by no means surprising for an industry that recruits employees, in part, through opulence. In a bid to attract the best and brightest, Silicon Valley companies have been known to offer prospective employees large salaries, lavish perks, and an impressive suite of benefits including, most recently, egg freezing coverage for female workers at Apple and Facebook. The wealthiest employee campuses, too, are becoming Willy Wonka-esque wonderlands, built as much around play as much as they are around work. Facebook employees, for instance, can enjoy a free candy shop, a video arcade, or a classic barbershop.
If you’re not a bright young programmer, however, Silicon Valley is anything but a paradise. Service workers in the industry are growing increasingly dissatisfied with an economy in which even entry-level tech employees are reaping massive benefits while they struggle to survive. And for these service workers, news that an intern could earn the equivalent of their entire annual income in three short months is not exactly well met.
Last week, for example, Facebook shuttle bus drivers voted to join the Teamsters union, telling USA Today that they “earn between $18 and $20 for ferrying technology workers who earn six-figure salaries to and from work.” These shuttle drivers are also expected to work a five-hour morning shift and a four-hour evening shift without being compensated for the hours in between, which many drivers must spend sleeping in their cars, away from their families. In light of these conditions, Rome Aloise, vice president of the local Teamsters, wrote a letter to Facebook CEO Mark Zuckerberg comparing Facebook employees to “nobleman” and the drivers to “the servants… who carry them back and forth each day.” In this cutting letter, Aloise proceeds to tell Zuckerberg that “these drivers can’t afford to support a family, send their children to school, or, least of all, afford to even dream of buying a house anywhere near where they work,” in sharp contrast with Facebook employees who live “in some of the most exclusive neighborhoods in the Bay Area.”
Tech companies like Facebook, Apple, and Google perpetuate this wage inequality by bringing in janitors, security guards, and landscapers through outside contractors rather than hiring them directly as employees. As Jessica Guynn reports for USA Today, outsourcing these jobs is an obvious attempt to cut costs; after all, if service workers were tech industry employees rather than contract workers, Silicon Valley companies would have to shell out the cash for health care and benefits. While tech employees are able take months of paid parental leave, then, many contract laborers are finding themselves unable to support the children they already have. In response to these and similar criticisms, Google recently hired over 200 security guards as employees, an important move that nonetheless registers as little more than a drop in the bucket for service workers in San Francisco as a whole.
The widening gap between rich and poor in the tech industry is, of course, reflective of broader economic shifts in the post-recession U.S. economy. According to a September report from the Federal Reserve, low-earning families have suffered “substantial declines” in average real income since the recession, families between the 40th and 90th percentiles have not yet recovered from recession losses, and “only families at the very top of the income distribution saw widespread income gains” in the last three years. The super-rich get richer, everyone else gets poorer, and the tech industry, in some respects, is no exception to this unfortunate but general rule.
But astronomical salaries for interns are the latest piece of evidence that the wage disparities in the tech industry aren’t merely symptomatic of this broader trend, they’re helping to drive it. Indeed, tech professional salaries seem to have been uniquely immune to the economic recession, increasing by an average of 2.4 percent per year for the last ten years to a current average of $87,811. In Silicon Valley proper, that number increases to $108,603, marking a 7.2 percent year-over-year increase. The highest-paid CEOs in tech take home anywhere between $15 and $78 million and, as Forbes reports, the tech industry now produces the second highest number of billionaires, only ranking behind the investment industry. For an industry that prides itself on path making, tech is certainly innovating income inequality. In fact, income disparity has increased in San Francisco more than any other city in the country.
As one of the wealthiest and fastest-growing sectors in the U.S. economy, the tech industry is uniquely situated to expand its generous treatment of employees to the contract workers who clean their offices, cook their food, and cut their manicured hedges. At first blush, the industry’s generous benefits, above average parental leave, and paid internships suggest a corporate culture that sees its employees as people first, but these perks come at an undeniable cost to the underclass on which Silicon Valley has been built. These internship figures are not a cause for celebration, as Jordan Weissmann argues at Slate, they’re a cause for concern. To bestow six figure salaries on interns before taking on contract workers as employees or, at least, raising their wages, sends a clear message to those who do the tech industry’s grunt work: your wellbeing is our lowest priority. In the choice between free candy shops and human beings, candy is still coming first.