The voices of Urban Institute's researchers and staff
May 11, 2016

Banning the box might increase racial discrimination

Unemployment and wage gaps in the United States remain stark, despite decades of work to reduce disparities in employment outcomes by race. For young black men, these disparities can be exacerbated by disproportionately high rates of incarceration and arrest. Proposals to “ban the box” aim to reduce discrimination by asking employers to remove questions about criminal history from their applications, but this well-intentioned movement may have unintended consequences.

In the first quarter of 2015, the unemployment rate for black men between the ages of 16 and 19 in the United States was 27.5 percent compared with 15.9 percent for white men of the same age; for black men between the ages of 20 and 24, the unemployment rate was 17.8 percent compared with just 9.1 percent for their white counterparts.

These numbers can be traced in part to high incarceration rates for black men. While people of color make up about 37 percent of the US population, they account for 67 percent of those imprisoned. Because a prison record or felony conviction makes it difficult for an individual to navigate the labor market, researchers estimate that the large population of formerly incarcerated men lowered the total male employment rate in 2008 by 1.5 to 1.7 percentage points, costing the US economy between $57 and $65 billion in lost output. Outcomes are even worse for formerly incarcerated minorities: though there is no evidence of divergence in wages before incarceration, wages grow at a 21 percent slower rate for black men compared with white men after serving time in prison.

To reduce these disparities and give people with a criminal record a second chance in the labor market, some public and private employers have removed the check box on their hiring application that asks whether the applicant has a criminal arrest or conviction—they have banned the box. In April, the US Office of Personnel Management issued a proposed rule that would ban the box for many positions in the federal government. And in 2015, New York City joined the list of cities, counties, and states who have banned the box for public employees. Many private employers, such as Walmart, Target, Home Depot, Bed Bath & Beyond, and more recently, Koch Industries Inc., have also voluntarily adopted ban-the-box hiring policies.

But evidence from other fields suggests that banning criminal-history questions on job applications may increase discrimination against applicants from groups that are arrested or convicted disproportionately. This is because of statistical discrimination in which employers make a decision about an individual on the basis of information about group averages. When information about the individual is not present, employers may make a judgement call based on the statistical (or perceived) likelihood  that the individual has a criminal record.

For example, an employer choosing between a black candidate and a white candidate might pick the white candidate simply because he is statistically less likely to have a criminal record. In that case, a black candidate with no criminal history would have been better off if the application had asked about convictions. In fact, one study in 2006 found that employers who check criminal backgrounds are more likely to hire African American workers, especially men.

These unintended consequences have been demonstrated by similar attempts to ban the use of background information. Bans on employer credit checks in hiring generate relatively worse outcomes for those with mid-to-low credit scores, for those under age 22, and for African Americans, groups the legislation was intended to help. On the flip side, the rise of employer drug testing in the 1980s actually benefited African Americans by enabling applicants to prove their status to employers.

The status quo is clearly not the answer, and there’s no doubt that the intent of ban-the-box legislation is good. However, the policy may be causing increased discrimination against groups that disproportionately have a criminal history. What is needed instead are policies and programs that address problems much farther upstream, where members of minority communities are being funneled into the criminal justice system.

In this July 27, 2011 photo, Michael Frasier transports bags of ice at his job in New Haven, Conn.  Frasier, who has been in and out of prison most of his adult life, found employment with help of a prison re-entry program in New Haven.  Photo by Jessica Hill/AP

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