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Incentivizing Employers to Hire Ex-Offenders: What Policies Are Most Effective?

From a new RAND Corporation report: "An estimated 64.6 million Americans (25 percent of the population) have a criminal record; of those, 19.8 million have at least one felony criminal conviction. Evidence indicates that ex-offenders have substantially lower probabilities of being hired than members of other disadvantaged groups — such as welfare recipients, high school dropouts, unemployed people, and those with "spotty" work histories — who do not have a criminal record. When ex-offenders experience poor economic outcomes, they are more likely to engage in criminal activity, which further affects their job and earnings growth and the standard of living for their families, friends, and wider community.

Designing Policies

While designing policies to improve the economic outcomes of ex-offenders could have far-reaching benefits, it also presents many challenges. Such programs and policies as the “Ban-the-Box” policy, which delays the point in the recruitment process that criminal-background information is made available to employers; the federal Work Opportunity Tax Credit (WOTC); certificates of rehabilitation, which restore some rights to people with felony convictions; and programs supported by Department of Labor Reintegration of Ex-Offenders grants all seek to incentivize the hiring of ex-offenders but have important limitations.

To inform efforts aimed at improving employment rates and earnings potential for ex-offenders, RAND researchers conducted experiments to examine employer preferences of policy options designed to incentivize employment of individuals with felony criminal records. Researchers recruited 107 employers, mostly managers or owners (58 percent) and human resource professionals (21 percent), from 34 states to respond to the survey-based experiments. Nearly all respondents work in private-sector firms (97 percent) with fewer than 100 employees (60 percent).

RAND emailed employers a survey that began with a narrative describing a situation in which they are hiring for an entry-level position and are considering two job candidates. Both of the candidates are described as having the technical skills for the entry-level job and one nonviolent felony conviction, but each is presented in the context of differing supportive policy features. The researchers tested policy features of a tax credit and then policy."

This report contains 6 major recommendations:

  • Urge Ex-Offenders to Use Staffing Agencies That Guarantee Replacement Workers When Initial Candidates Are Not a Good Fit

  • Provide Employers with Details of Previous Work Performance

  • Reduce Employer Paperwork Burden for Receiving a Tax Credit

  • Secure Transportation to Job Sites

  • Combine Job Placement Support with Other Ex-Offender Employment Incentives

Read more here

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