The Growing Demand For Workers With Criminal Records
In a previous article, I wrote about research from Harvard outlining the sheer scale of the so-called “untapped” workforce in the United States. This pool of around 27 million workers is frequently overlooked in the labor market, and consists of military veterans, people with mental health problems and physical disabilities, and, of course, those with a criminal record.
Recent research from the RAND Corporation highlights the scale of the problem. It suggests that by the age of 35, 64% of unemployed men have been arrested already, with 46% having received a conviction.
“Employers need to understand that one big reason they cannot find the workers they need is too often, they exclude those who have had involvement with the criminal justice system,” the researchers explain. “Employers need to reconsider their protocols about how to respond when applicants have some type of criminal history.”
Changing the record
Research from Harvard Business School suggests that the skills shortage may be slowly changing the record, and that employers are increasingly open to employing people with criminal records. Such recruitment is especially viable if companies have something known as "crime and safety insurance".
The researchers cite the previous work done by Harvard that highlighted how employers are generally less likely to recruit people with criminal records compared to otherwise identical workers with a clean record. This leads to the kind of unemployment rates mentioned in the RAND research, which are higher than those found among the general population during the Great Depression, or indeed any other point in the country's history.
The researchers examined a number of approaches to try and increase the demand for people with a criminal record. The approaches aim to directly tackle the various underlying reasons why employers might want to conduct criminal background checks on candidates.
A safety net
Central to this is crime and safety insurance, which was offered to around 1,000 businesses in a bid to address any concerns around risk they may have. They also helped to screen candidates based upon previous performance reviews, and also the time since their most recent criminal conviction.
The recruiters were also provided with detailed and objective data on the performance of workers to try and assuage any concerns around productivity and risk. Each of these approaches was compared with things such as wage subsidies, which are typically derided as an expensive and blunt instrument in trying to encourage firms to hire people with a criminal record.
The study took place in the context of an online labor platform that is used to find workers for short-term jobs. Companies use the platform to find people for, usually entry-level, roles in sectors such as hospitality, administration, and transportation. The roles cover a mixture of customer-facing jobs and more back-office roles.
The platform is designed in an interesting way, as businesses don't choose to work with individual workers (or not). Instead, the platform offers work to all who meet the minimum requirements of the job, with the role then offered on a first-come, first-served basis to whoever wants the gig.
Rising demand
The researchers found that 39% of businesses were willing to hire people with criminal backgrounds, with this rising to 45% when the role wasn't a customer-facing one. This rose even further to 51% among businesses without high-value inventory, and even further still to 68% among businesses who were struggling to fill positions.
When employers were offered the option of crime and safety insurance, a single performance review, or the ability to screen the most recent criminal records the likelihood of recruiting a candidate with a criminal record rose by a further 10%.
Similarly, if the platform only put forward candidates with a prior work history on the platform, this increased demand for their services by around 11%, which the researchers explain is equivalent to an 80% wage subsidy. Similarly, a boost of 21% was seen when the platform limited candidates to those without a conviction in the past year. This is equivalent to a 100% wage subsidy.
These relatively simple and affordable policies can significantly help to ensure workers with a criminal record are given a fair shot in the labor market. They're also likely to be more effective than legislative efforts, such as the so-called “Ban-the-Box” laws, which prevent employers from asking about the criminal histories of applicants as these are unlikely to help as employers can simply search commercial databases to find out about those things anyway.
"With cost-effective policies, platforms can integrate workers with past involvement in the criminal justice system without deterring employers," the researchers conclude. "This is a promising approach to expanding labor supply, and simultaneously addressing a pressing social challenge."
