U.S. economic growth suffers when former prisoners and convicted felons are locked out of the labor market, a new study shows.
Employment barriers faced by former offenders resulted in the estimated loss of 1.7 million to 1.9 million workers in 2014, reducing the overall U.S. employment rate by almost 1 percentage point, according to the report from the Center for Economic and Policy Research (CEPR).
That translates into a $78 billion to $87 billion loss in annual gross domestic product (GDP) for the United States.
“From laws banning former prisoners from employment, to harsh sentencing practices, millions of people face roadblocks in the path to employment,” said report co-author Alan Barber. “Barring meaningful policy change, the number of people convicted of a felony and former prisoners will only continue to grow, as will the magnitude of losses in employment and output.”
Using Bureau of Justice Statistics, the study estimates that the working-age population of people with felony convictions was between 14 million and 15.8 million in 2014, the most recent year that data was available. Of that total, between 6.1 million and 6.9 million were ex-prisoners.
“Prior research has shown the adverse impact that time in prison or a felony conviction can have on a person’s employment prospects,” CEPR experts wrote. “In addition to the stigma attached to a criminal record, these impacts can include the erosion of basic job skills, disruption of formal education, and the loss of social networks that can improve job-finding prospects. Those with felony convictions also face legal restrictions that lock them out of many government jobs and licensed professions.”
The report assumes that ex-prisoners and convicted felons face a “mid-range employment penalty” of 12 percentage points for having a criminal record, meaning their chances of being hired were reduced by 12 percent compared to those without criminal histories.
“In addition to the likely large reductions in personal earnings as a result of these employment penalties, the economy as a whole suffers from a reduction in output,” the researchers explained.
The study suggests that the “employment penalty” for convicted felons and the formerly incarcerated cost the United States almost .5 percentage points of GDP in 2014.
“While there has recently been a push from advocates and policy-makers alike to re-examine sentencing policy and practice, the negative impacts on former prisoners and people with felony convictions themselves and the economy as a whole will grow in scale unless the burgeoning reform trend continues and accelerates,” the report states.
Criminal justice reform advocates say “banning the box” on job applications is one basic step that more states should take to reduce employment barriers facing formerly incarcerated individuals. Under ban-the-box legislation, which is in effect in Illinois and 23 other states, employers have to evaluate a job applicant’s skills before asking about criminal history.
Advocates in Illinois are also pushing to remove employment barriers for former offenders in certain occupations that require licenses. State legislation to reform occupational licensing cleared both chambers last month and is awaiting action from Gov. Bruce Rauner. The measure would cover the industries of barbering, hair braiding, nail technology, esthetics, cosmetology and roof and funeral services. Licenses for such occupations could not be denied to former offenders, unless their crimes were directly related to the occupation.
“These are fields with strong projected job growth that could make a real difference to people trying to turn their lives around,” said Sodiqa Williams with the Safer Foundation, which advocated for the bill.