Second-chance hiring, explained

Second-chance hiring is when companies hire people who were formerly incarcerated.

It’s picking up across several industries, per The Wall Street Journal, due in part to:

• A national labor shortage
• Groups like the Second Chance Business Coalition, which consists of 40+ companies committed to the practice, including American Airlines, Target, and Microsoft.

Why it matters

There are 70m+ Americans with arrest or conviction records, and ~600k people are released from prison each year.

Finding a stable job can reduce recidivism, but there are often significant barriers.

According to a report by the Brookings-AEI Working Group on Criminal Justice Reform, people involved in the correctional system in the U.S. tend to be undereducated and underemployed compared to the general population. Roughly two-fifths of the people entering prison do not have a high school degree or General Educational Development (GED) credential, a rate which is three times higher than for adults in the U.S. The disparity for postsecondary education is even greater, where the rate at which adults have an associate’s degree or more is four times higher than what has been observed for prisoners.

Due to the stigmatizing mark of a criminal record along with the association between education levels and employment, relatively high rates of unemployment have been observed for correctional populations.  A number of studies have shown that the pre-prison employment rate (in the year before coming to prison) for people in prison is no higher than 35 percent. Post-release employment rates have been found to increase shortly after individuals were released from prison but later decline, eventually returning to pre-prison employment levels within a few years.

• More than 90% of employers conduct background checks. A criminal record can reduce chances of a second interview by 50%.
• A 2018 analysis found that the unemployment rate among formerly incarcerated people was over 27%.

A 2014 report estimated 1.7m-1.9m people were excluded from the workforce due to these barriers, costing the US $78B-$87B in annual GDP.

Second-chance hiring results are positive

A 2021 Society for Human Resource Management report found that 85% of HR pros felt that employees with criminal records performed the same or better than those without.

They also have lower turnover rates, which in turn saves companies money.

BTW: Last week, we wrote about remote work increasing opportunities for people with disabilities.