There are pros and cons to prison industries.
- Giving work to prisoners takes jobs away from people who need the work
- Inmates who are given jobs need to be monitored so they are doing the work they are supposed to be doing. Materials have been taken and used to make weapons, etc.
- Prisoners are given the opportunity to earn self-esteem. Not all people in prison are murderers. Some people are in prison because they made a horrible mistake. Working gives them the opportunity to feel valued.
- Many times prisoners learn a skill or trade. This helps them to someday become a productive member of society.
- Prisoners work for much less money. This helps to lower taxes.
Other advantages to prison labor:
- Inmates are productive and are kept busy; some even learn profitable trades, such as bricklaying and welding. Studies have shown that if prisoners spend their day locked up, they may become easily bored, or depressed or violent.
- The morale of inmates who work in certain areas such as industry improves because they gain a sense of pride in the construction of things as well as creative enjoyment. e.g. Inmates at a federal correction facility made Christmas decorations one year that won an award in the town in which the institution is located.
- When inmates make products, their wages are only cents/hour, much lower than the salary of those on the outside. Also, a state-owned facility is provided. Production by inmates saves the state a great deal of money. Thus, as inmates work, they may help pay part of the cost of their incarceration.
- When inmates have access to tools and building materials, etc. there is a risk that violence can occur with the tool in hand or materials can be smuggled in order to make a weapon.
- Security must be exerted; all use of materials must be well supervised and checked in and out carefully. When products go in and out via trucks coming into an institution, sometimes prisoners effect escapes.
- Staff can sometimes use prison labor to construct things for themselves.
- Some companies profit greatly from prison labor to the detriment of regular citizens who are denied the opportunites for such jobs. (e.g. Boeing Corporation cut costs by taking its production to two places: China and Washington State Reformatory where aircraft components are assembled.
On the plus side, prisoners can contribute to the economy at relatively low cost, and provide services for the government that lowers taxes, such as making license plates and street signs, which are low skilled jobs that pretty much anyone can do. On some level it is hoped that prisoners learn a work ethic by doing this, but there is little evidence to suggest that is widely the case.
On the negative side, there is the potential for corruption, as in wardens and job coordinators taking bribes or kickbacks, and undercutting local industries because they have low labor costs. There is also an ethical argument about whether such a workforce constitutes in essence, slave labor.
I assume that you are talking about things like having prisoners produce goods for sale to consumers.
The good part about this is that it could possibly lead to rehabilitation of inmates. It might teach them job skills and responsibility. In addition, it might help to defray some of the costs of keeping the people locked up.
On the other hand, there are problems. Mainly, anything made by a prisoner takes away a job that could be done by a person who is not in prison. So, in a sense, prison industries reward prisoners and hurt low-skilled workers who have not commited crimes.