Incarceration, Employment
and Public Policy

By Bruce Western
Princeton University

Prepared for the New Jersey Reentry Roundtable
Session Three
April, 2003

   
I gratefully acknowledge the Russell Sage Foundation
and the National Science Foundation for supporting this research.

Incarceration and Inequality

  • U.S. penal system has grown steadily since the early 1970s

  • About 2 million people are now in prison or jail in the United States

  • Prison and jail inmates are mostly low-skill black and Hispanic men under 40

  • What is the effect of incarceration on wages and wage inequality?

  • What are the policy implications?

 

The Current Period is Historically Exceptional

   

U.S. Incarceration is Comparatively Exceptional

 

Does carceral effort compare to welfare effort?

   

Why study the effects of incarceration?

 

Imprisonment as a Novel Life Course Event

   

Imprisonment and Other Life Events

 

How Does Incarceration Affect Wages?

  • Reducing human capital (lost work experience, diminished skills)

  • Signalling untrustworthiness to employers (civil disabilities, too)

  • Weakens social connections to steady employment

  • Reduces wage growth by limiting access to career jobs

  • Increases wage inequality because incarceration is concentrated among minority and low-education men
   

Results

Effect of Incarceration on Racial Inequality

Devah Pager’s Study of Employment Discrimination

  • Tester's sent to apply for entry-level unskilled jobs in Milwaukee

  • Two teams of testers: (1) two blacks, (2) two whites

  • One tester in each team is randomly given a resume showing a criminal record (resumes are identical in all other respects)

  • Reduces wage growth by limiting access to career jobs

  • Do employers call back testers at the same rate?
   

Results from the Milwaukee Study


Solid bar=no record, shaded bar=criminal record

 

Empirical Findings

  • Incarceration reduces wages by about 15%, and reduces rate of wage growth by about 1/3, because ex-inmates experiences irregular employment in causal jobs

  • Racial disparity in incarceration has increased black-white wage inequality by about 10% in the NLSY (may be higher in the population)

  • Audit study suggests felony status reduces employment opportunity by about 40%
   

Theoretical Implications

  • U.S. penal system has become ubiquitous in the lives of low-education African American men, and relatively common for low-education men in general

  • The influence of the penal system now extends beyond the narrow area of crime and criminal justice policy, and is becoming an important feature of a uniquely American system of social inequality

  • By increasing inequality, the prison boom may be creating significant social problems, and thus be a self-defeating strategy for crime control

 

Policy Implications

  • High incarceration rates are bad anti-crime and social policy

  • Key barriers released prison and jail inmates: low skill, stigma, steady jobs for low-skill workers

  • Must build skills through education and training (esp. after release)

  • Employer outreach: need connections to large employers who can offer steady work (employer incentives)

  • Diversion programs for those with a chance of job market success
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