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Employer hiring decisions and antidiscrimination policy

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  • H. J. Holzer

Abstract

Have federal antidiscrimination policies been effective in improving employment outcomes for minorities and females? If so, why have the relative wages and employment of blacks deteriorated in recent years? What other factors on the demand side of the labor market have contributed to these developments, and what are the appropriate public policy responses? In this paper I address these issues. I begin by reviewing evidence in the literature on the recent employment problems of minorities and on hiring discrimination. I specifically consider the effectiveness of Equal Employment Opportunity laws and Affirmative Action programs in improving employment outcomes for minorities as well as females. I then provide new evidence from a recent survey of over 3000 employers on the determinants of hiring. I focus on employer skill needs and hiring procedures, as well as the racial mix of the firm's applicants and customers, in determining employment outcomes for minorities and females. Employer use of Affirmative Action in recruiting and hiring is considered as well. Finally, I consider the implications of these findings for the usefulness of antidiscrimination policies and other approaches for improving employment outcomes for less-skilled minorities.

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Paper provided by University of Wisconsin Institute for Research on Poverty in its series Institute for Research on Poverty Discussion Papers with number 1085-96.

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Handle: RePEc:wop:wispod:1085-96

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  1. Harry J. Holzer & Richard Block & Marcus Cheatham & Jack H. Knott, 1993. "Are training subsidies for firms effective? The Michigan experience," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 46(4), pages 625-636, July.
  2. Holzer, Harry J, 1987. "Informal Job Search and Black Youth Unemployment," American Economic Review, American Economic Association, American Economic Association, vol. 77(3), pages 446-52, June.
  3. David Card & Alan Krueger, 1990. "School Quality and Black/White Relative Earnings: A Direct Assessment," Working Papers, Princeton University, Department of Economics, Industrial Relations Section. 652, Princeton University, Department of Economics, Industrial Relations Section..
  4. Topel, Robert H, 1994. "Regional Labor Markets and the Determinants of Wage Inequality," American Economic Review, American Economic Association, American Economic Association, vol. 84(2), pages 17-22, May.
  5. Levy, Frank & Murnane, Richard J, 1992. "U.S. Earnings Levels and Earnings Inequality: A Review of Recent Trends and Proposed Explanations," Journal of Economic Literature, American Economic Association, vol. 30(3), pages 1333-81, September.
  6. Freeman, Richard B. & Holzer, Harry J. (ed.), 1986. "The Black Youth Employment Crisis," National Bureau of Economic Research Books, University of Chicago Press, edition 0, number 9780226261645.
  7. Michael Boozer & Alan Krueger & Shari Wolkon, 1992. "Race and School Quality Since Brown vs. Board of Education," Working Papers, Princeton University, Department of Economics, Industrial Relations Section. 681, Princeton University, Department of Economics, Industrial Relations Section..
  8. Neal, Derek A & Johnson, William R, 1996. "The Role of Premarket Factors in Black-White Wage Differences," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 104(5), pages 869-95, October.
  9. Bound, John & Holzer, Harry J, 1993. "Industrial Shifts, Skills Levels, and the Labor Market for White and Black Males," The Review of Economics and Statistics, MIT Press, vol. 75(3), pages 387-96, August.
  10. Leonard, Jonathan S, 1984. "Employment and Occupational Advance under Affirmative Action," The Review of Economics and Statistics, MIT Press, vol. 66(3), pages 377-85, August.
  11. Bloch, Farrell, 1994. "Antidiscrimination Law and Minority Employment," University of Chicago Press Economics Books, University of Chicago Press, edition 0, number 9780226059839.
  12. Gary Burtless, 1985. "Are targeted wage subsidies harmful? Evidence from a wage voucher experiment," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 39(1), pages 105-114, October.
  13. Jeffrey D. Sachs & Howard J. Shatz, 1994. "Trade and Jobs in Manufacturing," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 25(1), pages 1-84.
  14. Robert H. Meyer & David A. Wise, 1982. "High School Preparation and Early Labor Force Experience," NBER Chapters, in: The Youth Labor Market Problem: Its Nature, Causes, and Consequences, pages 277-348 National Bureau of Economic Research, Inc.
  15. Ihlanfeldt, Keith R., 1997. "Information on the Spatial Distribution of Job Opportunities within Metropolitan Areas," Journal of Urban Economics, Elsevier, vol. 41(2), pages 218-242, March.
  16. Harry J. Holzer & Keith R. Ihlanfeldt, 1996. "Spatial factors and the employment of blacks at the firm level," New England Economic Review, Federal Reserve Bank of Boston, Federal Reserve Bank of Boston, issue May, pages 65-86.
  17. O'Neill, June, 1990. "The Role of Human Capital in Earnings Differences between Black and White Men," Journal of Economic Perspectives, American Economic Association, American Economic Association, vol. 4(4), pages 25-45, Fall.
  18. David T. Ellwood, 1982. "Teenage Unemployment: Permanent Scars or Temporary Blemishes?," NBER Chapters, in: The Youth Labor Market Problem: Its Nature, Causes, and Consequences, pages 349-390 National Bureau of Economic Research, Inc.
  19. Francisco L. Rivera-Batiz, 1992. "Quantitative Literacy and the Likelihood of Employment among Young Adults in the United States," Journal of Human Resources, University of Wisconsin Press, vol. 27(2), pages 313-328.
  20. Berman, Eli & Bound, John & Griliches, Zvi, 1994. "Changes in the Demand for Skilled Labor within U.S. Manufacturing: Evidence from the Annual Survey of Manufactures," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 109(2), pages 367-97, May.
  21. Becker, Gary S., 1971. "The Economics of Discrimination," University of Chicago Press Economics Books, University of Chicago Press, edition 1, number 9780226041162.
  22. Smith, James P & Welch, Finis R, 1989. "Black Economic Progress after Myrdal," Journal of Economic Literature, American Economic Association, vol. 27(2), pages 519-64, June.
  23. Richard B. Freeman, 1994. "Crime and the Job Market," NBER Working Papers 4910, National Bureau of Economic Research, Inc.
  24. Juhn, Chinhui, 1992. "Decline of Male Labor Market Participation: The Role of Declining Market Opportunities," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 107(1), pages 79-121, February.
  25. Leonard, Jonathan S, 1990. "The Impact of Affirmative Action Regulation and Equal Employment Law on Black Employment," Journal of Economic Perspectives, American Economic Association, American Economic Association, vol. 4(4), pages 47-63, Fall.
  26. David Neumark & Roy J. Bank & Kyle D. Van Nort, 1995. "Sex Discrimination in Restaurant Hiring: An Audit Study," NBER Working Papers 5024, National Bureau of Economic Research, Inc.
  27. Jonathan S. Leonard, 1983. "Anti-Discrimination or Reverse Discrimination: The Impact of Changing Demographics, Title VII and Affirmative Action on Productivity," NBER Working Papers 1240, National Bureau of Economic Research, Inc.
  28. Juhn, Chinhui & Murphy, Kevin M & Pierce, Brooks, 1993. "Wage Inequality and the Rise in Returns to Skill," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 101(3), pages 410-42, June.
  29. Richard Butler & James J. Heckman, 1977. "The Government's Impact on the Labor Market Status of Black Americans: A Critical Review," NBER Working Papers 0183, National Bureau of Economic Research, Inc.
  30. Blau, Francine D & Kahn, Lawrence M, 1994. "Rising Wage Inequality and the U.S. Gender Gap," American Economic Review, American Economic Association, American Economic Association, vol. 84(2), pages 23-28, May.
  31. Lynch, Lisa M, 1992. "Private-Sector Training and the Earnings of Young Workers," American Economic Review, American Economic Association, American Economic Association, vol. 82(1), pages 299-312, March.
  32. Ihlanfeldt, Keith R & Sjoquist, David L, 1990. "Job Accessibility and Racial Differences in Youth Employment Rates," American Economic Review, American Economic Association, American Economic Association, vol. 80(1), pages 267-76, March.
  33. Gunderson, Morley, 1989. "Male-Female Wage Differentials and Policy Responses," Journal of Economic Literature, American Economic Association, vol. 27(1), pages 46-72, March.
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Cited by:
  1. Harry J. Holzer, . "Black Applicants, Black Employees, and Urban Labor Market Policy," Institute for Research on Poverty Discussion Papers, University of Wisconsin Institute for Research on Poverty 1162-98, University of Wisconsin Institute for Research on Poverty.
  2. Holzer, Harry & Neumark, David, 1999. "Are Affirmative Action Hires Less Qualified? Evidence from Employer-Employee Data on New Hires," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 17(3), pages 534-69, July.
  3. Jinyong Hahn & Petra Todd & Wilbert Van der Klaauw, 1999. "Evaluating the Effect of an Antidiscrimination Law Using a Regression-Discontinuity Design," NBER Working Papers 7131, National Bureau of Economic Research, Inc.

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