Is it Possible to be Underpaid?

Laurence M. Vance – May 18, 2018

Are teachers and interns underpaid? Some people apparently think so.

On February 22, the West Virginia branches of the American Federation of Teachers and the National Education Association called for teachers across West Virginia to strike, mainly because of low teacher pay and rising health-insurance costs. Teacher pay in West Virginia ranks near the bottom among the fifty states. A pay raise passed by the legislature and signed into law by the governor provided only a 2 percent raise for 2019, and 1 percent for 2020 and 2021. After teachers walked off the job, picketed in front of schools, and protested in front of the state capitol, their strike ended on March 7 after the legislature and governor agreed to give them a 5 percent raise.

Teacher strikes then spread to Oklahoma and Arizona.

Teachers in Oklahoma went on strike for nine days in April. They were granted a $6,000 a year raise, although they had sought $10,000.

Teachers in Arizona went on strike near the end of April. Their strike ended on May 3 after the state government granted teachers a 20 percent pay raise over the next three years.

Teachers in some districts in the states of Kentucky and Colorado have gone on strike as well. Thousands of North Carolina teachers recently marched on the state Capitol calling for higher pay, greater spending on education, and better working conditions. “Remember, remember, we vote in November,” they chanted.

But if teachers in these states think they have it bad, consider the case of interns.

According to a recent article at Salon, “Unpaid work is going mainstream, and it’s spreading fast.” The author, Sophia McClennen, laments that “many college graduates are poised to work for free to ‘advance’ their career goals.” It turns out that “the unpaid internship has been on the rise since the economic crisis of 2008.” During that time, “internships for college students ballooned.” There are between 1-2 million internships each year in the United States and “around 75 percent of undergraduates at four-year colleges and universities now take at least one internship before they graduate.” In 2014, “97 percent of large corporations hired interns” but “around half of them didn’t get paid.”

Colleges are to blame as well because they “charge students for internship credits, which are required in a range of majors and graduate degrees.” So, students often work in unpaid internships, but still have to pay their college to get the credit needed to graduate. Concludes McClennen: “They literally pay for the privilege to work for free.” And even worse, students are now “taking unpaid work even after they graduate.”

McClennen believes that “the real problem here is ideological”:

The idea of working for free should bother us. The idea that young people aren’t valued for their work should bother us. The idea that a recent graduate should expect to live at home while “volunteering” for an NGO in order to kickstart their career should bother us. But somehow, since the 1990s, when internships were rare, we have collectively accepted that this sort of unpaid apprentice system makes sense. We have accepted the idea that the labor of young people isn’t of value.

The charge that teachers and interns are underpaid brings up an important question: Is it possible to be underpaid?

First, a few words about teacher salaries are in order.

A teacher’s salary is not the only form of compensation he receives. Writing recently for the American Enterprise Institute (AEI), Frederick Hess and Amy Cummings point out that “teacher retirement and health-care systems are much more expensive than those of the taxpayers who pay for them — whether those taxpayers work in the private or public sector.” They note that “while the average civilian employee receives $1.78 for retirement benefits per hour of work, public school teachers receive $6.22 per hour in retirement compensation.”

But even aside from this, the average teacher does receive market-level wages, as two other AEI scholars recently pointed out in the City Journal. In fact, teachers who “change to non-teaching jobs take an average salary cut of about 3 percent.” Public-school teachers do earn lower salaries than the average college graduate, but “about half of teachers major in education, among the least-rigorous fields at both the undergraduate and graduate levels.” Incoming education majors “have lower SAT or GRE scores than candidates in other fields.”

But let’s assume for a moment that teachers receive no retirement benefits, pay the total cost of their health insurance, and receive below-market wages. This still wouldn’t mean that they were underpaid. Likewise, neither interns who work for free are underpaid.

Am I saying that it is impossible to be underpaid? No, I am not. It is possible in some circumstances to be underpaid.

If you agree with a buyer to sell an item for a x amount of money and then realize later that you were only paid an amount equal to something less than x, then you were underpaid.

If you agree with an employer to work for x amount of money per hour, week, or month or to do a particular job for x amount of money and end up being paid an amount equal to something less than x, then you were underpaid.

But if you agree with a buyer to sell an item for a x amount of money and then realize later that you could have sold it to that buyer or another buyer for something greater than x, then you were not underpaid. You may have been careless, negligent, or ignorant, but underpaid you were not.

And if you agree with an employer to work for x amount of money per hour, week, or month or to do a particular job for x amount of money and end up realizing that others were paid more than xto do the same job or that you could have gotten paid more than x per hour, week, or month, then you were not underpaid. You may have been unwise, foolish, or rash, but underpaid you were not.

If teachers are underpaid, then why are there so many teachers? Why do teachers show up for work if they make “only” x amount of money? There are a number of reasons: retirement benefits, health insurance coverage, summers off, Christmas break, spring break, paid holidays, off early in the afternoon, no night or weekend work, prestige, job security.

If interns are underpaid, then why are their numbers increasing? Why would an intern work for little or no money? Again, there are a number of reasons: gain valuable work experience, networking, strengthen their resume, potential employment with the company they intern for, learn about an occupation or industry, check out a possible career path.

If someone doesn’t like the salary he is offered to be an employee, then he shouldn’t take the job. If an employee doesn’t like what he is currently getting paid by his employer, then he should quit his job. If an employee doesn’t like his prospects for getting paid more in the future by his employer, then he should find another job.

In a free society, going on strike because you are getting paid exactly what you agreed to work for would result in your being fired. There is no right to a particular job. Barring specific language in an employment contract, there is no right to receive a particular rate of pay, an increase in pay every year, or the same level of benefits every year. And of course, in a free society, the government would not interfere in any way with any consensual employer-employee relationship.

This article was originally published at Laurence M. Vance is a columnist and policy adviser for the Future of Freedom Foundation, an associated scholar of the Ludwig von Mises Institute, and a columnist, blogger, and book reviewer at He is also the author of Social Insecurity and The War on Drugs Is a War on Freedom. His newest books are War, Christianity, and the State: Essays on the Follies of Christian Militarism and War, Empire, and the Military: Essays on the Follies of War and U.S. Foreign Policy. Visit his website:


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