70. Prison Labor

Summary

Episode Summary: The Economics of Everyday Things - Episode 70: Prison Labor

Host: Zachary Crockett
Release Date: November 11, 2024
Podcast: The Economics of Everyday Things
Host/Author: Freakonomics Network & Zachary Crockett

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Introduction to Prison Labor

In Episode 70, titled "Prison Labor," Zachary Crockett delves into the intricate world of prison labor in the United States. The episode examines how incarcerated individuals contribute to various industries, the historical context of this labor force, and the economic and ethical implications surrounding it.

A Day in the Life of an Incarcerated Worker

The episode opens with an introduction to Christopher Barnes, an inmate at Franklin Correctional Center in Bun, North Carolina, who works at a highway sign plant within the prison. Barnes describes his daily routine and the nature of his work:

Christopher Barnes [01:12]: "I get my thoughts together, get down, and then get my hygiene together."

Barnes highlights the pride he takes in manufacturing highway signs, a role that often surprises his family:

Christopher Barnes [01:44]: "It's amazing that we do all these signs, you know."

Despite being incarcerated for life for first-degree murder, Barnes emphasizes the structured environment and the purpose his work serves within the prison system.

Historical Context of Prison Labor

Zachary Crockett provides a historical overview of prison labor in America, tracing its roots back to colonial times when Britain utilized transported criminals alongside enslaved individuals to sustain the early agrarian economy. The evolution continued post-Civil War with the 13th Amendment, which abolished slavery except as punishment for a crime:

Christopher Barnes [04:54]: "So the 13th Amendment outlaws slavery, except when you have been convicted of a crime."

Laura Appleman, a law professor at Willamette University, elaborates on this legacy, explaining how it transformed into a system where prison labor became a cost-saving measure for the state.

Modern Practices of Prison Labor

Today, approximately 800,000 incarcerated individuals participate in prison labor across the United States, contributing to an estimated $11 billion worth of goods and services annually. These workers are employed in diverse sectors, including manufacturing, agriculture, and public services. For instance, Correction Enterprises, a state-operated entity in North Carolina, manages multiple facilities that produce items ranging from license plates to prescription glasses.

Lee Blackmon [07:50]: "Every sign is preassembled here at this sign plant. So when it gets to the road, we know absolutely it's going to fit and it's going to work."

The economic efficiency of prison labor is highlighted by the stark difference in labor costs compared to the private sector. While typical businesses allocate 25-35% of production costs to labor, Correction Enterprises maintains this figure at approximately 2.5%.

Lee Blackmon [10:18]: "If you pay taxes, and I'm a taxpayer in the state of North Carolina, I want everybody to be as frugal with my tax dollars as they can be."

Economic and Ethical Implications

The episode critically examines the ethical dimensions of prison labor. Unlike traditional employment, incarcerated workers are often paid minimal wages, ranging from 13 cents to 52 cents per hour, or sometimes nothing at all. This lack of fair compensation raises questions about exploitation and the true cost savings for taxpayers.

Christopher Barnes [10:33]: "Prison labor is classified as, quote, non market work, so you don't have to pay them anything near the minimum wage."

Furthermore, the portrayal of prison labor as a rehabilitative tool is scrutinized. While some argue that work programs can reduce recidivism by equipping inmates with job skills, data suggests mixed outcomes. For instance, Brian Scott, a former inmate, successfully transitioned to a civilian job post-release, earning significantly more than he did while incarcerated:

Brian Scott [23:11]: "I think my starting pay was $15 an hour. That first paycheck. It was more money than I would make in almost an entire year working for Correction Enterprises."

However, the majority of incarcerated individuals do not reap such benefits, with over 60% unemployed a year after release.

Living Conditions and Worker Treatment

The episode sheds light on the harsh realities faced by prison workers. Brian Scott recounts the challenges of working under Correction Enterprises, where unjust deductions from wages and the necessity of side hustles to supplement income are commonplace:

Brian Scott [18:00]: "A lot of people couldn't afford that sort of thing."

Additionally, the narrative exposes the lack of employment protections for prisoners. Unlike regular employees, incarcerated workers are not covered by workplace safety regulations or workers' compensation in case of injury.

Laura Appleman [21:18]: "It's not forced labor, although depends how you define forced. It's not the chain gang, it's not convict lease. But the pressures are different."

Conclusion: The Dual-Edged Sword of Prison Labor

"The Economics of Everyday Things" presents a nuanced view of prison labor, balancing its economic benefits against the ethical and social challenges it presents. While prison labor undeniably reduces costs for governments and provides some inmates with skills, it also perpetuates a system of low wages and limited opportunities for meaningful reintegration into society.

Christopher Barnes encapsulates the personal impact of this system:

Christopher Barnes [24:04]: "Quietness goes a long way."

The episode concludes by emphasizing the need for a deeper societal conversation about the role of prison labor in the American economy and its implications for justice and rehabilitation.

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Key Takeaways

• Economic Efficiency: Prison labor significantly reduces production costs for government-run and private enterprises.
• Historical Roots: The use of prison labor is deeply entrenched in America's historical and legal framework, particularly the 13th Amendment.
• Ethical Concerns: Minimal compensation and lack of employment protections raise ethical questions about exploitation and fairness.
• Rehabilitation vs. Exploitation: While some inmates benefit from job training, the overall impact on reducing recidivism is limited.
• Personal Stories: Individual accounts, such as those of Christopher Barnes and Brian Scott, highlight the human side of prison labor dynamics.

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Notable Quotes

• Christopher Barnes [04:54]: "So the 13th Amendment outlaws slavery, except when you have been convicted of a crime."
• Lee Blackmon [10:18]: "If you pay taxes, and I'm a taxpayer in the state of North Carolina, I want everybody to be as frugal with my tax dollars as they can be."
• Brian Scott [23:11]: "I think my starting pay was $15 an hour. That first paycheck. It was more money than I would make in almost an entire year working for Correction Enterprises."
• Laura Appleman [21:18]: "It's not forced labor, although depends how you define forced. It's not the chain gang, it's not convict lease. But the pressures are different."

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This episode offers a comprehensive exploration of prison labor, encouraging listeners to reconsider commonly held perceptions and understand the complex interplay between economics, justice, and human dignity within the prison system.

Transcript

[Zachary Crockett]

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[Christopher Barnes]

I get my thoughts together, get down, and then get my hygiene together.

[Zachary Crockett]

He brushes his teeth, washes his face, and at around 7 in the morning, he makes the short commute to his workplace.

[Christopher Barnes]

I work at EG Sheeting. I sheet the metal and trim it and get it ready for screening. I've been in that apartment the whole time I've been down here.

[Zachary Crockett]

Barnes and his colleagues make highway signs, those really big green ones that tell you which exits are coming up.

[Christopher Barnes]

My family, they be like, what you doing the sign plant? And I tell them I make signs in the streets. It's like, wow, I thought somebody else did that. I mean, it's amazing that we do all these signs, you know.

[Zachary Crockett]

It's amazing in part because Barnes isn't an ordinary employee. Technically, he's not an employee at all. He's serving a life sentence for first degree murder. And the sign plant where he works is located inside Franklin Correctional Center, a medium security prison in Bun, North Carolina. Barnes is one of around 800,000 incarcerated people with jobs in America's prison system. They grow crops, repair roads, fight wildfires, and manufacture a surprising number of the products we encounter in daily life, from office furniture to reading glasses. It's estimated that more than $11 billion worth of goods and services Every year can be traced back to workers who are mostly paid pennies per hour for their labor, or even nothing at all.

[Christopher Barnes]

As a whole, in society, we are not incredibly sympathetic towards prisoners having to do work. I think if you ask the average American, they would be like, good. But if you explained exactly how it worked, they would be a little more unsettled.

[Zachary Crockett]

For the Freakonomics radio network, this is the economics of everyday things. I'm Zachary Crockett. Today, prison labor. Last week we looked into the economics of highway signs and learned that many of them are made by incarcerated people like Christopher Barnes. We wanted to learn more about how prison labor became a central part of the economy. And we found out that the story goes back to the founding of our country. In America, work has long been used as a form of punishment. Back when we were still a colony, Britain shipped over criminals and sold them to farms in Virginia and Maryland. They worked in the fields alongside enslaved people, and together their labor sustained our early agrarian economy. As America's justice system evolved, we began to send convicts to prisons.

[Christopher Barnes]

You don't really see the first prison labor until the beginning of the 19th century.

[Zachary Crockett]

Laura Appleman is a professor of law at Willamette University in Oregon. She's researched the history and economics of prison labor.

[Christopher Barnes]

What quickly became common is something called the industrial prison. Prisoners were essentially rented out to for profit companies for labor. They were putting together furniture, they were making clothes, making wagons, whatever was local. Originally, it was to recoup the expense of prisons. But then they realized, hey, we can make some money here.

[Zachary Crockett]

When the 13th amendment was passed after the Civil War banning slavery and other forms of unpaid labor, a notable exception was carved out.

[Christopher Barnes]

So the 13th Amendment outlaws slavery, except when you have been convicted of a crime.

[Zachary Crockett]

Across the south, thousands of emancipated slaves were locked up for petty offenses. They were forced to grow crops on penal farms. Later, they were shackled together in chain gangs that built roads for government contractors. These practices persisted for many decades, and eventually they morphed into a larger and more institutional system.

[Christopher Barnes]

Things didn't really start going into the big time until the 80s 90s, when mass incarceration really started booming. Costs skyrocketed, and prison labor is the way that government is trying to pay for it.

[Zachary Crockett]

Today, more than a million people are incarcerated in federal and state prisons across the country. Housing and feeding them is very expensive. The median cost per person is around $64,000 a year. That cost falls on the state and ultimately taxpayers. The government offsets these costs by putting prisoners to work as much as possible. At the majority of prisons, you'll find them doing a lot of the internal labor. They cook meals in the cafeteria, do laundry, clean the buildings and maintain the grounds. But they also work in government run prison factories where they produce billions of dollars worth of goods that are sold to public institutions and private industry. Earlier this year, we visited one of these factories, a highway sign plant at Franklin Correctional center in Bunn, North Carolina. It was off a country road, behind a guard tower and a fortress of barbed wire fences.

[Louis Southall]

You would never think that you would have something like this in a small community in a small town in North Carolina.

[Zachary Crockett]

That's Louis Southall, the prison's warden. He oversees the 300 incarcerated men who live there.

[Louis Southall]

We've had offenders here from duis all.

[Zachary Crockett]

The way up to incarcerated for taking someone's life. Almost all of those men have a job, whether it's sweeping floors or mowing the lawns. But according to Southall, only the best workers get to work in the sign plant.

[Louis Southall]

This is a million dollar corporation, and you don't want to have somebody down here that may have anger issues or have destructive issues. You can have one offender destroy a whole sign and it may cost tens of thousands of dollars.

[Zachary Crockett]

While the sign plant is on prison grounds, it's actually run by a separate entity operated by a company called Correction Enterprises. And when we stepped inside the factory floor, we met the guy running the show.

[Louis Southall]

Every sign is preassembled here at this sign plant. So when it gets to the road, we know absolutely it's going to fit and it's going to work. Every piece goes together like a puzzle.

[Zachary Crockett]

That's Lee Blackmon. He's a general manager at Correction Enterprises. It's a part of the North Carolina Department of Adult Correction. The company has 27 production facilities across the state, all almost entirely staffed by prisoners.

[Louis Southall]

Our assigned manufacturing plant. This is just one of the many plants that we have. All these plants are different industries. The other ones that I have a hand in are the metal plant down in Anson County, Woodworking and upholstery up at Alexander Optical Plant we have over in Nash. The other general managers have a wide variety of plants that they look after, whether it be janitorial, whether it be laundries, whether it be sewing.

[Zachary Crockett]

Correction Enterprises uses prison labor to make dozens of products. Employed prisoners sew the linens used in prison beds. They process canned peas and beef patties for prison cafeterias. They manufacture air fresheners, hand soap, motor oil, prescription glasses, picnic tables, and license plates. Last year, Correction Enterprises sold $121 million worth of goods. Almost all of those sales were to government agencies in the state of North Carolina, many of which are required to shop through the company. The sign plant, for instance, primarily sells to the state's Department of Transportation.

[Louis Southall]

DOT is by far our largest customer. We also do a lot of work for any tax supported entity within the state of North Carolina. We can do business with nonprofits. State employees can order signs from us or any products from Correction Enterprises.

[Zachary Crockett]

By using prison labor to produce all of these signs, Correction Enterprises is able to offer the government prices that are well below market rate. At a typical business, labor accounts for around 25 to 35% of the cost to produce goods. At Correction Enterprises, it's only around 2.5%. That's less than $3 million in labor costs on $121 million in sales. Blackmun says the benefits of those savings trickle down.

[Louis Southall]

If you pay taxes, and I'm a taxpayer in the state of North Carolina, I want everybody to be as frugal with my tax dollars as they can be.

[Zachary Crockett]

But that frugality is only possible because prisoners aren't protected by most employment laws.

[Christopher Barnes]

Prison labor is classified as, quote, non market work, so you don't have to pay them anything near the minimum wage.

[Zachary Crockett]

For incarcerated workers, pay depends on the type of job they have and where they work. Most jobs pay somewhere between 13 cents and 52 cents an hour. In some states, like Kansas, prisoners are paid around 5 cents an hour. And in others, like Alabama and Mississippi, prison jobs don't pay at all.

[Christopher Barnes]

All states are in on this. I mean, it's a great source of very low cost labor.

[Zachary Crockett]

Almost every state in America has its own version of Correction Enterprises. And prisoners often do much riskier work than building furniture and spacing out letters on highway signs. Some prison jobs are part of work release programs that send incarcerated men and women to the outside world. At the height of the pandemic, prisoners transported dead bodies to morgues and disinfected medical supplies. After a hurricane or an oil spill, they're dispatched to clean up the mess. And when wildfires break out, they're airlifted into the heart of the forest. Federal prisons have their own system for taking advantage of cheap labor. The government owned Federal prison Industries, or FPI, has more than 60 work facilities across the country. It manufactures around 300 products. Boots, jumpsuits, tools, medical supplies, body armor, and even electronic components for guided missiles, which it sells to the Department of Defense. But prisoners don't just do work for the government. Sometimes the state leases out their labor to companies in the private sector.

[Christopher Barnes]

The companies really want to keep it quiet, but I think they're thrilled because it's so much cheaper. And the state government is thrilled because they make some money.

[Zachary Crockett]

Prisoners have sewed underwear for Victoria's Secret, worked in call centers for cell phone companies, and made cheese that was sold in Whole Foods.

[Christopher Barnes]

46 states run agricultural programs within their prison systems. They raise a lot of food, and some of it's used for the prison itself, and some of it is sold on the open market.

[Zachary Crockett]

An investigation by the Associated Press found that food produced on penal farms ends up in popular products like Frosted Flake cereal, Gold Medal Flour, and Ballpark hot dogs. Companies don't just save money on labor costs, they often earn tax credits for hiring work release prisoners. All of this makes prison labor a great deal for taxpayers, governments and private businesses. But there's another side to the story, and to understand it, you have to talk to people who actually do the work that's coming up the Economics of Everyday Things is sponsored by Indeed. With Indeed, there's no need to search for candidates you'll just match Indeed doesn't just help you hire faster. 93% of employers agree Indeed delivers the highest quality matches compared to other job sites, according to a recent Indeed survey. Ditch the busy work. Use Indeed to connect with candidates faster by scheduling, screening and Messaging. Leveraging over 140 million qualifications and preferences every day. Indeed's matching engine is constantly learning from your preferences, so the more you use Indeed the better it gets. And listeners of this show will get a $75 sponsored job credit to get your jobs more visibility@ Indeed.com everydaythings just go to Indeed.com everydaythings right now and support our show by saying you heard about Indeed on this podcast. Indeed.com everydaythings Terms and conditions apply. Need to hire you need Indeed. The Economics of Everyday Things is sponsored by Oracle. Even if you think it's a bit overhyped, AI is suddenly everywhere from self driving cars to molecular medicine to business efficiency. If it's not in your industry yet, it's coming fast. But AI needs a lot of speed and computing power, so how do you compete without costs spiraling out of control? Time to upgrade to the next generation of the cloud with Oracle Cloud Infrastructure. OCI is a fast and secure platform for your infrastructure, database, application development, plus all your AI and machine learning workloads. OCI costs 50% less for computing and 80% less for networking, saving you a pile of money. Right now, Oracle is offering to cut your current cloud bill in half if you move to OCI for new US customers with minimum financial commitment. Offer ends December 31, 2024. See if your company qualifies for this special [e-mail] everydaythings that's oracle.com everydaythings Apple Card is the perfect card for your holiday shopping. When you use Apple Card on your iPhone, you'll earn up to 3% daily cash back on every purchase, including products at Apple like a new iPhone 16 or Apple Watch Ultra. Apply now in the Wallet app on your iPhone, subject to credit approval. Apple Card issued by Goldman Sachs Bank USA Salt Lake City Branch terms and more at applecard.com Brian Scott served 20 years in prison before being released in 2021. For most of that time he was at the Nash Correctional Institution in North Carolina and he was working at a printing facility run by Correction Enterprises.

[Brian Scott]

We did everything from what they call inmate stationery, which is the paper that they gave us to write on to. You know, we did a brochure that detailed all of the wineries across the entire state. It was always something different.

[Zachary Crockett]

I read on the site that they even did report cards there for high schools and colleges.

[Brian Scott]

Yes, and the temporary tags that you get when you purchase a new vehicle.

[Zachary Crockett]

The printing facility was staffed by around 130 prisoners and the day to day work was similar to what employees at any other printing facility would do, except in exchange for his labor, Scott was only paid 26 cents an hour.

[Brian Scott]

We actually started at 13 cents and then there was a raise that you got pretty soon to 20 cents and then, you know, the 26 cents was when you were actually operating a machine or a computer. The crazy thing is it was actually one of the higher paying jobs. There were many people working back in the dorms, pushing brooms or whatever and they were making, you know, anywhere from 40 cents a day to maybe a dollar a day at the most.

[Zachary Crockett]

Every Sunday. Scott's weekly earnings around $14 were transferred into a trust fund controlled by the prison and he says getting full pay wasn't guaranteed.

[Brian Scott]

There were some individuals who would have some of their pay taken out because they had received a lot of write ups or they had some court appointed fees that they had to pay. A write up was $10, but when you're only making $15 and they take $10, it hurts.

[Zachary Crockett]

Most incarcerated people use their money to buy stuff at the commissary or canteen, a store inside the prison. Their wages don't go far.

[Brian Scott]

Ramen noodle Soup was maybe 25 cents Coca Cola was probably, I don't know, a dollar and a half. When you're considering that you're making $14 a week, you know, $1.50 to spend on a Coke is a lot of money. A lot of people couldn't afford that sort of thing.

[Zachary Crockett]

Scott says many people with prison jobs took on side hustles to supplement their income.

[Brian Scott]

I don't know how many green peppers I bought from guys who worked in the chow hall. That was the way that they tried to compensate for the pennies that they were being paid. We had people who would draw a picture of your child or your spouse, and you would pay them a fee for that.

[Zachary Crockett]

Scott had an operation making incense sticks in his cell. He'd sell them for one postage stamp, which was a form of currency behind bars.

[Brian Scott]

The process was you would get the stick off of a broom, you would take one little square of toilet paper, which the state provided, you would wrap it around the stick, you would get it damp, and then you would roll it in the sage. That had to come out of the chow hall. They would sell little bottles of oil in the canteen, and I would dab it on the whole stick, let it dry, and there you go, you've got an incense stick.

[Zachary Crockett]

Aside from the pay, Scott says his time at the printing plant was a tolerable experience. But toward the end of his sentence, he was transferred to another correction enterprises facility where he refurbished traffic signs. And that was a different story.

[Brian Scott]

It really was a horrible place. Nobody liked being there. It was off site. So you got bussed to this location, bused back in, and every day when you came back, you had to go through a full strip search because the labor is so cheap, they would have more people than they actually needed. I can remember being just given some of the most tedious jobs just to keep me busy. There was a building that we had to pressure wash during the winter. There were picnic tables outside that we had to chip all the paint off of.

[Zachary Crockett]

The people who run prison labor programs often say that working at their facilities is a choice and that if a prisoner doesn't like a certain job, they're free to find other work inside the prison. But this freedom often comes with a catch. The New York Times recently reported that prisoners in an Alabama facility who refuse to take on work release jobs often face disciplinary action. Again, here's law professor Laura Appleman.

[Christopher Barnes]

Technically, it's not forced labor, although depends how you define forced. It's not the chain gang, it's not convict lease. But the pressures are different. If you Absolutely refuse to do anything. Your privileges are going to be taken away. And of course, when you're incarcerated, privileges sort of make life bearable.

[Zachary Crockett]

Appelman also says that because prisoners aren't considered employees, they aren't covered by employment protections, things like workplace safety regulations and a workers comp in case of injury. But some incarcerated workers believe that prison labor will pay off for them down the line. Work programs are often positioned as a solution to recidivism, the tendency of convicted criminals to reoffend. The idea is that the skills you learn on the inside will help you land on your feet once you're out. Lee Blackman of Correction Enterprises made that point during a walkthrough of the sign plant in North Carolina.

[Louis Southall]

We can take these men and we teach them. And once they start doing the job, they're figuring out, hey, I can do this. They start believing in themselves. They got the confidence, they know they can do that job, and they can walk into a prospective employer and say, let me show you what I can do.

[Zachary Crockett]

The evidence that prison labor helps incarcerated people find jobs once they're back out in the real world is mixed. Many companies won't even consider hiring people with felony convictions. And more than 60% of people who are released from prison are unemployed a year later. But it does work out for some people, including Brian Scott. After he was released in 2021, he quickly found a civilian job in the printing industry.

[Brian Scott]

Correction Enterprises connected me with the printing company in Burlington that had expressed an interest in hiring people with criminal records. I think my starting pay was $15 an hour. That first paycheck. It was more money than I would make in almost an entire year working for Craigslist Enterprises.

[Zachary Crockett]

Christopher Barnes, the incarcerated worker at the sign plant in Bunn, North Carolina, will never see that kind of paycheck. He's in prison for life with no possibility of parole for him. The benefit of working a job in prison isn't the pay, the chance to learn new skills, or the promise of a brighter future. It's the brief moment of respite he gets from the cell block each morning before the machines fire up and the highway signs are cut to size.

[Christopher Barnes]

Quiet. Quietness goes a long way.

[Zachary Crockett]

For the economics of everyday things. I'm Zachary Crockett. This episode was produced by me and Sarah Lilly and mixed by Jeremy Johnston. We had help from Daniel Moritz. Rhapsody.

[Brian Scott]

I guarantee you there are stamps floating around the system that were purchased 20 and 25 years ago.

[Zachary Crockett]

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[Louis Southall]

It out.

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