What You Should Know About the Prison-Industrial Complex

Prison Cell
Getty Images / Darrin Klimek

Derived from the Cold War-era term “military-industrial complex,” the term “prison-industrial complex” (PIC) refers to a combination of private-sector and government interests that profit from increased spending on prisons, whether it is truly justified or not. Rather than a covert conspiracy, the PIC is criticized as a convergence of self-serving special interest groups that openly encourage new prison construction, while discouraging the advancement of reforms intended to reduce the inmate population. In general, the prison-industrial complex is made up of:

  • Politicians who play on fear by running on “get tough on crime” platforms
  • State and federal lobbyists who represent prison industries and the companies that profit from cheap prison labor and exploitation of incarcerated people.
  • Depressed rural areas that depend on prisons for their economic survival
  • Private companies that view the $35 billion spent each year on corrections as creating a lucrative market, rather than imposing a drain on taxpayers

Influenced by prison industry lobbyists, some members of Congress may be persuaded to press for harsher federal sentencing laws that will send more non-violent offenders to prison, while opposing prison reform and legislation on the rights of incarcerated people.

Prison Inmate Jobs 

As the only Americans not protected from enslavement and forced labor by the 13th Amendment to the U.S. Constitution, prison inmates have historically been required to perform routine prison maintenance jobs. Today, however, many inmates take part in work programs that make products and provide services for the private sector and government agencies. Typically paid far below the federal minimum wage, inmates now build furniture, make clothing, operate telemarketing call centers, raise and harvest crops, and produce uniforms for the U.S. military.

For example, the signature line of jeans and t-shirts Prison Blues is produced by inmate-workers at the Eastern Oregon Correctional Institute. Employing more than 14,000 inmates nationwide, one government-managed prison labor agency produces equipment for the U.S. Department of Defense.

Wages Paid to Inmate Workers 

According to the U.S. Bureau of Labor Statistics (BLS), inmates in prison work programs earn from 95 cents to $4.73 per day. Federal law allows the prisons to deduct up to 80% of their wages for taxes, government programs to assist crime victims, and the costs of incarceration. Prisons also deduct small amounts of money from inmates required to pay child support. In addition, some prisons deduct money for mandatory savings accounts intended to help convicts become re-established in the free community after their release. After deductions, participating inmates netted about $4.1 million of the $10.5 million total wages paid by prison work programs from April to June 2012, according to the BLS.

In privately-run prisons, inmate workers typically make as little as 17 cents per hour for a six-hour day, a total of about $20 per month. Incarcerated workers in federally-operated prisons are paid more, but still only an average of 14% of the federal minimum wage. Earning an average of $1.25 an hour for an eight-hour day with occasional overtime, federal inmates can net from $200–$300 per month.

The Pros and Cons 

Proponents of the prison-industrial complex argue that rather than unfairly making the best of a bad situation, prison work programs contribute to the inmates’ rehabilitation by providing job training opportunities. Prison jobs keep inmates busy and out of trouble, and money generated from the sales of prison industries products and services help maintain the prison system, thus easing the burden on taxpayers.

Opponents of the prison-industrial complex contend that the typically low-skill jobs and minimal training offered by prison work programs simply do not prepare inmates to enter the workforce in the communities to which they will eventually return after their release. In addition, the growing trend toward privately-operated prisons has forced states to pay for the cost of contracts for outsourced incarceration. Money deducted from wages paid to inmates goes to increase the profits of the private prison companies rather than decreasing the cost of incarceration to taxpayers.

According to its critics, the effect of the prison-industrial complex can be seen in the stark statistic that while the violent crime rate in the United States has fallen by about 20% since 1991, the number of inmates in U.S. prisons and jails has grown by 50%.

How Businesses View Prison Labor 

Private sector businesses that use inmate workers profit from significantly lower labor costs. For example, an Ohio company that supplies parts to Honda pays its prison workers $2 an hour for the same work regular union auto workers are paid $20 to $30 an hour. Konica-Minolta pays its prison workers 50 cents an hour to repair its copiers.

In addition, businesses are not required to provide benefits like vacations, health care, and sick leave for inmate workers. Similarly, businesses are free to hire, terminate, and set pay rates for inmate workers without the collective bargaining limitations often imposed by labor unions. In fact, according to the 1977 case Jones v. North Carolina Prisoners' Labor Union, the U.S. Supreme Court ruled that incarcerated people do not have the right to unionize.

On the downside, small businesses often lose manufacturing contracts to prison industries because they are unable to match the low production costs of a vast pool of low-paid convict workers. Since 2012, several small companies that had historically produced uniforms for the U.S. military have been forced to lay off workers after losing contracts to UNICOR, a government-owned prison labor program.

Civil Rights

Civil rights groups argue that the practices of the prison-industrial complex lead to the building, expanding prisons mainly for the purpose of creating employment opportunities utilizing prisoner labor at the expense of the inmates themselves.

For example, the American Civil Liberties Union (ACLU) contends that the prison-industrial complex’s drive for profit through privatization of prisons has actually contributed to the continued growth of America’s prison population. In addition, the ACLU argues that the construction of new prisons solely for their profit potential will ultimately result in the often unjust and lengthy imprisonment of millions of additional Americans, with a disproportionately high number of the poor and people of color being jailed. 

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Your Citation
Longley, Robert. "What You Should Know About the Prison-Industrial Complex." ThoughtCo, Apr. 13, 2021, thoughtco.com/what-you-should-know-about-the-prison-industrial-complex-4155637. Longley, Robert. (2021, April 13). What You Should Know About the Prison-Industrial Complex. Retrieved from https://www.thoughtco.com/what-you-should-know-about-the-prison-industrial-complex-4155637 Longley, Robert. "What You Should Know About the Prison-Industrial Complex." ThoughtCo. https://www.thoughtco.com/what-you-should-know-about-the-prison-industrial-complex-4155637 (accessed June 15, 2021).