In the United States, penal labor is a multi-billion-dollar industry. Annually, incarcerated workers provide at least $9 billion in services to the prison system and produce more than $2 billion in goods. The industry underwent many transitions throughout the late 19th and early and mid 20th centuries. Legislation such as the Hawes-Cooper Act of 1929 placed limitations on the trade of prison-made goods. Federal establishment of the Federal Prison Industries (FPI) in 1934 revitalized the prison labor system following the Great Depression. Increases in prison labor participation began in 1979 with the formation of the Prison Industry Enhancement Certification Program (PIECP). The PIECP is a federal program first authorized under the Justice System Improvement Act of 1979. Approved by Congress in 1990 for indefinite continuation, the program legalizes the transportation of prison-made goods across state lines and allows prison inmates to earn market wages in private sector jobs that can go towards tax deductions, victim compensation, family support, and room and board.

Federal Prison Industries, Inc. (FPI), doing business as UNICOR since 1977, is a wholly owned United States government corporation created in 1934 as a prison labor program for inmates within the Federal Bureau of Prisons, and a component of the Department of Justice. It is headquartered in Washington, D.C.