Why Businesses Should Reach Out To The 70 Million Americans Excluded From the Workforce

Last month, the White House announced that 185 employers had pledged to eliminate job barriers for people with past convictions. The impressive list includes tech giants such as Google and Facebook and the ubiquitous Starbucks. Collectively, the Fair Chance Business Pledge signatories employ three million Americans.

But what’s most significant about the pledge is not the diversity of businesses or even the size of some of the corporations involved. Rather, it’s the public example being set that most matters—the visibility of these employers committing to open their doors to job candidates with prior convictions.

Unfortunately, any contact with the criminal justice system—no matter how minor or how long ago—can be a modern-day scarlet letter, chilling a hiring manager’s enthusiasm for a job applicant. As a nation, we say we believe in second chances and the power of redemption, but too often, businesses don’t see themselves as stakeholders in addressing the consequences of our broken justice system. Even those employers who are open to hiring people with records may do so quietly for fear of tarnishing their brand or reputation.

But the cumulative impact of adverse hiring decisions against people with records means that businesses are part of the problem.

There are 70 million Americans with an arrest or conviction record. With a job callback rate that drops by at least 50 percent when a person has a record, the reality is that millions are locked out of jobs. The economic impact is profound. Because people with felony records and the formerly incarcerated have poor prospects in the labor market, the nation’s gross domestic product in 2014 was reduced by an estimated $78 to $87 billion. That doesn’t even account for the substantial cost of the criminal justice system; in 2012, real expenditures totaled over $274 billion.

Billions lost that could have helped power our economy is a real business concern; but the human potential squandered and thenegative impact on our communities are the real tragedies. The talents, skills, and abilities of millions of people are being overlooked. Employers who have hired people with records—such as the renownedJohns Hopkins Hospital and Health System, the popular Dave’s Killer Bread, and many others—can attest that they are finding some of their most dedicated workers from this pool—people who are ready to work hard and add value to the company. In addition to employers’ experiences, some preliminary research has shown that people with felony records in the military were promoted faster and to higher levels than those without.

The lesson here is that employers who can look beyond the stigma of a record can realize this untapped potential.

Doing so should also be part of every business’s commitment to supporting diversity in the workplace. Fearmongering and negative media portrayals of young men of color have perpetuated stereotypes of dangerousness and unworthiness. When a person of color has a record, those damaging stereotypes are not only left intact but also amplified. The interplay between racial discrimination and record stigma is apparent when comparing the racial differences in the job-callback-rate penalty. Black job applicants with a record suffer a greater penalty on their callback rates than whites with a record—by roughly double.

Unsurprisingly, a hiring manager responding adversely to the perceived “criminality” of an applicant with a record isn’t taking into account a criminal justice system that disproportionately targets people of color or the accumulation of the history of institutionalized racism. But in fact, the second-class status of people with records is so intimately tied to race discrimination that the U.S. Equal Employment Opportunity Commission was prompted to issue its 2012 guidance on the use of records in employment decisions to enforce federal civil rights law. But even if an employer abides by the EEOC’s guidance to remove a no-hire policy against people with records, a job interviewer may be unconsciously responding to the negative-work-performance stereotypes attached to having a record.

The magnitude of these problems is daunting, but there are concrete actions businesses can take to be part of the solution. Taking the Fair Chance Business Pledge is a step in the right direction. To ensure that the promise of fair-chance employment is realized, businesses must next be willing to enact policy changes, create a fair-chance culture, adopt initiatives to affirmatively hire people with records, and evaluate the outcome of their reforms to ensure they’re actually hiring changes. By taking these steps, businesses will not only better align their practices with their principles of diversity and inclusion, but will also benefit by getting beyond the bias and seeing the true value of an overlooked workforce.

Michelle Natividad Rodriguez is a Senior Staff Attorney at the National Employment Law Project and is leading efforts to promote fair chance employment nationwide.

The GradsofLifeVoice Forbes team provides thought leadership, research and expert commentary on innovative talent pipelines and related issues such as the skills gap, income inequality, workforce diversity, and the business case for employment pathways. We seek to change employers’ perceptions of young adults with atypical resumes from social liabilities to economic assets. This post was originally featured here.

Diversity, Hiring & Retention Practices, Management & Leadership,
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