Are Greg and Emily More Employable Than Lakisha and Jamal

7/31/2019 Are Greg and Emily More Employable Than Lakisha and Jamal

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Are African Americans discriminated

against in the labor market?

Differing views on whether discriminationexists or not

Role of affirmative action programs.

Profit maximization is the motive of employers.

Reverse discrimination due to stringent

enforcement of affirmative action programs.


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Previous Research ondiscrimination in labor markets

Census: Shows persistence of inequalities,but suffers from the problem of unobservable

characteristics in census data. Audit Studies: These cannot account for

inherent differences in individuals. Thismethod is not double blind.


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Experiment Design

Creating a bank of resumes:

Four occupational categories: Sales,administrative support, clerical services and

customer services. Resumes prepared on the basis of resumes of

actual job seekers in Chicago and Boston.

Resumes modified so that they werent identical

to actual job seekers.

Resumes modified to accentuate qualitydifference, creating high quality and low qualityresumes.


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Identities of Fictitious Applicants:

Name frequency data on babies born in Massachusettsbetween 1974-79 used to ascertain which names are uniqueto African Americans and Whites.

Survey conducted in Chicago to check for race associated withthe names.

Resumes of the same race, sex, city and resume quality wereallotted the same phone number. Voice mailbox system wasused.

Fictitious addresses constructed based on real streets in

Boston and Chicago. Addresses allocated randomly toresumes.

E-mail accounts created and addresses mentioned in higherquality resumes.


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Responding to Ads:

Employment ads that sought resumes in The

Boston Globe and The Chicago Tribune wereselected.

Four resumes- high and low quality of both races

were sent in response to each advertisement.

Resumes were altered according to jobspecifications wherever required.

Nearly 5000 resumes sent in response to over1300 ads.


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How to ascertain discrimination?

Equal treatment: When a callback is receivedon

all four resumes

none of the resumes

both high quality resumes

both low quality resumes


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Results of the Experiment


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Impact of Resume Quality


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Lower incentive to invest in skills: The

difference in callback percentage (probitregression) for high quality resumes is statisticallysignificant for African American names, butremains lesser than the whites.

Impact of applicants address: Living inneighborhoods that are whiter, have higherincome earners and more educated peopleincreases callback rate, but there is no evidencethat the African Americans benefit more than thewhites.

A white name is equivalent to the return onadditional 8 years of experience.


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Effect of Job Requirements:

Several ads mentioned specific requirements:

communication skills (12%), organization skills(7%), education level(11%).

No significant effect of job requirements on racial

difference in callback was observed.

Effect of Employer Characteristics:

Information about employer characteristics was

collected through the ads, and web reverse lookup

services: size, ownership, equal opportunityemployer, federal contractors, etc.

Callback rates from Equal opportunity employers does

not differ significantly from the rest of the firms.


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Differential treatment does not vary with employersize.

Point estimates show less differential treatment in thenot for profit sector.

Employers were classified into six industrycategories; jobs into six occupation categories:

Positive gap in callback observed in all occupation andindustry categories (except transport andcommunication).

No systematic relationship between occupationearnings and the racial gap in callback.

Differences in gap in callback rates across industriesand occupations was not statistically significant.

Significant positive effect of employer location (zip

code), but this effect was very small.


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Weaknesses of the Experiment:

It measures gap in callback for interviews rather

than gaps in hiring or earnings. Resumes suggestrather than directly report race.

The race specific names may not be representativeof the average African American who may not have

a racially distinct name.

Newspapers represent only one channel of jobsearch: it is possible that African Americans usemostly social networks for job search or employerswho hire using such networks discriminate less.


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Potential Confounds Apart from race, the names chosen may signal

some personal trait.E.g. Latonya and Tyroneare names that might be interpreted as coming fromdisadvantaged backgrounds. But, African Americans benefit lesser than whites when

they are from well off neighborhoods.

This gap should be more for jobs requiring soft skills.

The chosen names are more prevalent among thedisadvantaged. But the correlation between the educationlevel of mothers and the callback rates is not significant.

Reverse Discrimination: Employersof small firmsmay assume that highly qualified African Americanshave better opportunities.This is unlikely, as thegapin callback is not significantly smaller among better

jobs.


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Relation to Existing Theories

Taste based discrimination: Customers, co-workers or employers may have prejudicedtastes.

Discrimination by customers and co-workers is not

an explanation as the amount of customer contactand fraction of white employees differ significantlyin different industries and occupations.

Employer discrimination: Can explain the general

difference in callback, but cannot explain whyreturn to credentials is lower for African Americans.


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Statistical Discrimination Employers may use observable characteristic

(race) as a proxy for an unobservablecharacteristic. This cannot explain the credentialseffect.

Affirmative action makes it easier for AfricanAmericans to acquire skills, thereby these arediscounted at a higher rate by employers.

Lexicographic searches by employers:Employers may follow rules such as read nofurther after coming across a resume with anAfrican American name.


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Conclusion

African Americans face differential treatmentwhile searching for jobs, across occupationsand industries.

Improving observable skills and credentialsdoes not seem to overcome this problem.

Are Greg and Emily More Employable Than Lakisha and Jamal

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