This is something I had thought about quite a bit a couple of decades back when they were bringing chain gangs back in some southern state:  How is prison labour any different from slavery?

This article in the NY Times brought these thoughts back.  http://www.nytimes.com/2011/02/25/us/25inmates.html?nl=todaysheadlines&emc=tha23

So they are saving their state budgets by having people who have little or no choice essentially work for free, rather than taxing the wealthy a little more.
At the same time they are taking work from people who need it, and who have the opportunity to spend it on something other than prison goods.

I understand the part where prisoners benefit by learning skills and having their boredom alleviated.  At the same time there is an economic perversity I cannot quite reconcile.  I've often thought that if people had the kind of money it takes to keep them in prison, they wouldn't need to resort to crime.  Now they're in prison, paid for by the tax payer, and available for cheap labour to the neighbouring businesses.  I'm sure there are positive aspects for prisoners, but they're still being exploited to the detriment of non-incarcerated workers, and they're still being used in the service of economic inequality.

Then there is the perversity of working for money while your family on the outside is likely dependent to some extend on social services, and cannot benefit from your labour.  It's worse than being an immigrant - at least they get to send some money home. 
And somehow it does seem like the tax payer is supplying cheap labour to "qualifying" businesses.