The Impact of Affirmative Action on the Employment of Minorities and Women: A Longitudinal Analysis Using Three Decades of EEO‐1 Filings

What role has affirmative action played in the growth of minority and female employment in U.S. firms? This paper presents a longitudinal analysis of this question by exploiting rich variation across firms in the timing of federal contracting to identify affirmative action effects over the course of three decades spanning 1973 to 2003. It constitutes the first study to comprehensively document the long‐term and dynamic effects of affirmative action in federal contracting on employment composition within firms in the United States. I use a new panel of over 100,000 large private‐sector firms from the U.S. Equal Employment Opportunity Commission, including both firms that obtain federal contracts and are therefore mandated to implement affirmative action and firms that are noncontractors, across all industries and regions. The paper's key results indicate that the primary beneficiaries of affirmative action in federal contracting over 1973 to 2003 were black and Native American women and men. Dynamic event study analysis of workforce composition around the time of contracting reveals that a large part of the effect of affirmative action on increasing protected group shares occurred within the first four years of gaining a contract, and that these increased shares persisted even after a firm was no longer a federal contractor. The paper also uncovers important results on how the impact of affirmative action evolved over 1973 to 2003, in particular that the fastest growth in the employment shares of minorities and women at federal contractors relative to noncontracting firms occurred during the 1970s and early 1980s, decelerating substantially in ensuing years.