Where Do Ex-Offenders Find Jobs? An Industrial Profile of the Employers of Ex-Offenders in Virginia

Where Do Ex-Offenders Find Jobs? An Industrial Profile of the Employers of Ex-Offenders in Virginia

Lichtenberger, Eric

Abstract

Based on an examination of the earnings records of ex-offenders released from Virginia correctional institutions from fiscal year 1999 to 2003, this article provides an industrial profile testing the presumption that most ex-offenders are only able to find employment in low-level occupations, with low rates of job retention, and limited customer contact Data related to both ex-offenders and their respective employers were categorized using the North American Industrial Classification System (NAICS) and as a result, overall employment, full-time employment, and earnings patterns were identified for each industry. When available, data regarding the entire workforce were used for comparison purposes. The information provided in this article could be used by transition coordinators in job placement activities. Furthermore, correctional education administrators could use this information for the following purposes: 1) allocating resources to the vocational areas where ex-offenders are more likely to find employment, 2) cultivating relationships with employers most likely to hire exoffenders, and 3) influencing major employers who do not have histories of hiring exoffenders to change their human resource practices.

The earnings records of ex-offenders provide an informational link to specific employers and can help determine the extent to which employers, collectively based on industry, have previously hired ex-offenders. This information could be used to aid ex-offenders in the transition process as it would allow them to narrow their search for potential employers. Directing ex-offenders to employers within industries with histories of not discriminating against them is only one aspect of a successful transition. Equally important Iis identifying employers within industries where ex-offenders have histories of sustained employment. The examination of earnings records would provide the necessary information to develop profiles of both industries and specific employers where the likelihood of stable employment is greater. Although there is no guarantee that previous hiring practices and employment patterns are an indication of the present situation, knowing the information could make the transition effort more efficient and job searches more focused.

Brief Review of Literature

A literature review yielded no research that systematically examined earnings records to determine the industries in which employers have demonstrated patterns of hiring ex-offenders. In spite of that, it has generally been presumed that most ex-offenders are only able to find employment in low-level occupations with low rates of job retention (Fry Consulting Group, 1987; Heinrich, 2000; Holzer, Raphael, & Stoll, 2003). In a position paper intended to raise awareness about the obstacles ex-offenders face in securing gainful employment, Heinrich (2000) argued that low rates of job retention can be traced to the types of jobs that ex-offenders are relegated to, namely entry-level customer service jobs within the administrative and support services industry. Heinrich also indicated job retention would improve when ex-offenders are appropriately matched to a particular position based on their skills and interests. The Fry Consulting Group (1987) in discussions with Labor Department officials, corrections, probation, and parole officials in New York City indicated that the majority of ex-offender placements are in entry-level jobs that offer neither high pay nor job mobility. Furthermore, they argued the jobs taken by ex-offenders are such that they do not attract other workers besides exoffenders or they are Jobs in which the employer cannot afford to pay a decent wage (Fry Consulting Group, 1987). In a study determining employer demand for ex-offenders within Los Angeles, Holzer, Raphael, and Stoll (2003) found employers within industries-namely the manufacturing, construction, and transportation industries-with a high percentage of unskilled jobs, high rates of turnover, and jobs with limited customer contact are not only more willing to hire ex-offenders, but that willingness is reflected in their hiring practices. If exoffenders are relegated to jobs within industries with high turnover and low rates of job mobility, then recidivism becomes an issue.

Research has shown that sustained employment within any industry is related to reduced recidivism (Fry Consulting Group, 1987; Lichtenberger & Onyewu, 2005; Morrissey, Ogle, & Lichtenberger, 2005). In a study of the employment and earnings patterns of all ex-offenders released from Virginia correctional institutions, from January 1999 through June 2002, Morrissey, Ogle, and Lichtenberger (2005) found that ex-offenders who are employed and have stable employment patterns, earn more, and are less likely to recidivate than those who are unemployed or are employed but have unstable patterns of employment. Lichtenberger and Onyewu (2005) established a similar pattern in their historical analysis of Virginia’s incarcerated Youth Offender Program. Released program participants who did not recidivate had significantly higher earnings, based on average quarterly earnings, and more stability in their employment patterns, based on percentage of available quarters worked, when compared to program participants who recidivated. An examination of a court employment project in New York City by the Fry Consulting Croup (1987) found the successful employment of ex-offenders accompanied by the necessary supportive services have proved to be a deterrent to recidivism.

The opposite is also true, as research has also shown the lack of employment is related to Increased recidivism rates (Eisenberg, 1990; Bureau of Justice Statistics, 1996). In a follow-up of participants of a Texas program-Project Riofocusing on the reintegration of ex-offenders Into society, Eisenberg (1990) found that program participants are three times more likely to recidivate If they are unemployed. Similarly, the Bureau of Justice Statistics (1996) indicated 89% of parole and probation violators were unemployed at the time of re-arrest. Since the research suggests increased employment and job retention rates result in lower recidivism, it would be a great benefit to identify the industries where ex-offenders are more likely to gain and subsequently maintain employment.

Methodology

This manuscript was part of a larger research project completed by the Center for Assessment, Evaluation, and Educational Programming (CAEEP) and funded by the Virginia Department of Correctional Education. The author of this manuscript was the principal investigator for the aforementioned project. Even though the data used in this study is limited to Virginia, because Virginia has urban, rural and suburban areas with varying levels of economic development, population density, and diversity, the results could provide an indication of industrial hiring patterns in similarly composed states or areas.

The industrial profile was created using individual earnings records of exoffenders released from fiscal year 1999 to 2003 (84,373 in total), to identify their employers (19,923). That information was then cross-referenced with the VEC employer database from the first fiscal quarter of 2003, using each employer’s federal identification number and a 79% match rate was achieved for employers (15,821 of 19,923 employers matched the VEC employer database). Roughly 83%-70,405 of 84,373-of the earnings records matched to the 15,821 employers. Match rates could have been higher, but the employment data was over a five year period and the employer data was current at the time (first fiscal quarter of 2003), meaning employers of exoffenders in 1999 could have gone out of business or changed their federal identification number by the time the employer database was created in 2003. From this point on, the number of employers of ex-offenders is referred to as the number matching the VEC employer database (15,821) and the number of ex-offenders employed is referred to as the 70,405 earnings records corresponding to the matched employers. It should be noted that one exoffender could have worked for multiple employers; therefore the 70,405 earnings records do not equate to 70,405 different ex-offenders finding employment. Instead, the 70,405 records indicate one ex-offender working for one employer during at least one quarter. For security purposes, sensitive data, such as employers’ federal identification numbers and ex-offenders’ social security numbers, were used only to match records from the two files and were not published or used in any other manner. Once the match was performed and the two databases were combined, sensitive fields were deleted.

Findings

Table 1 displays all of the employers in Virginia and categorizes them by NAICS code for comparison to employers within the same industries that have hired at least one ex-offender. Out of the 192,910 Virginia employers included in the employer file, 15,821 (8.23%) employed at least one ex-offender from fiscal year 1999 to fiscal year 2003. The industry with the greatest number of employers hiring ex-offenders was construction, with 4,687 (29.63%), which was consistent with previous research, in a pilot study that determined the satisfaction of employers with the vocational training of ex-offenders, Lichtenberger and Morrissey (2004) found 28.21% of employers of ex-offenders were in the construction industry. Similarly, Hoizer, Raphael, and Stoil (2003) determined the willingness of employers within the construction industry to hire ex-offenders was more likely to impact their actual hiring practices than servicebased industries. As displayed on Table 1, the accommodation and food services industry had the second greatest number of employers hiring exoffenders with 2,200 (13.91%). The industry with the third greatest number of employers hiring ex-offenders was administrative and support services industry with 1,532 (9.68%), most likely due to temporary employment agencies falling within it.

The industries with the greatest percentage of employers within the industry hiring ex-offenders were manufacturing (21.66%), construction (19.89%), accommodation and food services (16.62%), and administrative and support services (14.28%), in that order. The industries with the smallest percentage of employers within the industry hiring ex-offenders were: finance and insurance (0.71%), professional, scientific and technical services (1.52%), and public administration (1.59%), respectively.

Differences were identified between the industries when comparing the proportion of all Virginia employers to those that have employed at least one ex-offender. A disproportionate number of the employers of ex-offenders were in the construction Industry. Roughly 30% of employers of ex-offenders were in the construction industry; however, only 12.26% of all Virginia employers were involved in construction. The professional, scientific, and technical services industry also had a disproportionate number of employers of ex-offenders. Even though professional, scientific, and technical services was the Virginia industry with the second greatest number of employers (13.78% of all employers), only 2.54% of the employers of ex-offenders fell within it. The same was true for the finance industry as it included 5.47% of all Virginia employers, yet only .47% of the employers of ex-offenders fell within it.

Table 2 displays the number of Virginia workers and the number of exoffenders employed in the first fiscal quarter of 2003, and the number of exoffenders employed from 1999 to 2003, and categorizes the data by industry. During the first fiscal quarter of 2003, the administrative and support services industry employed the greatest number of ex-offenders (22.92%), closely followed by the construction industry (20.74%). There appeared to be a second tier of industries in terms of the number of ex-offenders employed in the first fiscal quarter of 2003, as the accommodation and food services industry employed 1,264 ex-offenders (13.91%), the manufacturing industry employed 1,111 ex-offenders (12.22%), and the retail trade industry employed 834 exoffenders (9.18%).

Based on an industry by industry comparison of the proportion of employed ex-offenders to Virginia’s total workforce, ex-offenders were overrepresented in: construction, manufacturing, administrative and support services, and accommodation and food services. The industry with the greatest difference between ex-offenders and the total workforce was administrative and support services, as it included 5.38% of the total workforce in the first fiscal quarter of 2003, but more than one-fifth (22.92%) of employed ex-offenders. Ex-offenders also appeared to be employed in disproportionate numbers in the construction industry as it included 20.74% of employed ex-offenders in the first fiscal quarter of 2003, but only 5.54% of the total workforce.

Ex-offenders were underrepresented in the following industries: information, finance and insurance, professional, scientific, and technical services, educational services, health care, and public administration. While only 0.29% and 1.80% of employed ex-offenders worked within the public administration and health care industries, respectively, both of those Industries comprised roughly 10% of Virginia’s workforce. The same was true for educational services and professional, scientific, and technical services as they included 6.62% and 7.93% of Virginia workforce, but only 0.37% and 1.32% of the employed ex-offenders from 1999 to 2003. During the first fiscal quarter of 2003, the information and finance and insurance industries were 3.40% and 4.65% of Virginia’s total workforce, but only 0.50 % and 0.62% of employed ex-offenders, in that order.

As demonstrated on Table 2, the proportion of ex-offenders employed in the various industries was similar between all ex-offenders employed from 1999 to 2003 and those only employed in the first fiscal quarter of 2003, suggesting that the industrial patterns are relatively stable throughout the entire period included in the earnings records. However, there were two industries with notable decreases: accommodation and food services-16.fab% overall compared to 13.91% in the first fiscal quarter of 2003-and administrative and support services-27.74% overall compared to 22.92% In the first fiscal quarter of 2003. There were also three industries with notable increases: manufacturing (10.98% overall compared to 13.28% in the first fiscal quarter of 2003), transportation and warehousing (2.82% overall compared to 4.64% In the first fiscal quarter of 2003), and construction (18.42% overall compared to 20.74% in the first fiscal quarter of 2003).

In an effort to examine the employment stability of ex-offenders, those who met the minimum requirements for full-time employment during the first fiscal quarter of 2003 were identified. Minimum full-time wages were determined by multiplying the number of weeks in a quarter (13) by the minimum full-time work week (30 hours). This figure was then multiplied by the current minimum wage of $5.15 per hour. Therefore, $2008.50 was used as a minimum criterion for determining the number of individuals who worked fulltime in the third quarter of 2003. Out of the 9,088 individuals who had reported earnings that matched the employer file in the third quarter of 2003, 4,564, or roughly half, worked full-time. As demonstrated on Table 3, the mining industry had the highest percentage of employed ex-offenders working full-time (85.19%); however, the number of ex-offenders working in mining was relatively low, so this should be viewed with caution. Among the industries with a sizable (greater than 100) number of ex-offenders employed, manufacturing (71.83%), wholesale trade (70.27%), construction (62.02%), and health care (60.37%) had the higher percentage of ex-offenders employed full-time. This suggested employment for ex-offenders working within those industries is relatively stable. The administrative and support services and the accommodation and food services industries had the lowest percentage of employed ex-offenders working full-time (28.61 % and 33.94%, respectively), suggesting employment within those industries is comparatively less stable.

The industries with the highest average quarterly earnings were finance and insurance ($8,170.16), health care ($7,786.10), and information ($5,540.25). However, health care was the only industry among the previously mentioned three with a sizable number of ex-offenders employed (164), as the finance and insurance had 56 ex-offenders and Information had only 45. The two industries with the lowest average quarterly earnings were administrative and support services and accommodation and food services, with $1,655.42 and $1,736.44, respectively. Coincidentally, administrative and support services (2,083) and accommodation and food services (1,264) were among the top five industries in terms of the number of ex-offenders employed.

The overall relative strength of each industry was measured using a formula that weighed the: 1) overall number of ex-offenders employed, 2) percentage of ex-offenders employed within each industry working full-time, and 3) average quarterly earnings for ex-offenders. Each of the three parts of the formula had a maximum value of 100, so the highest relative industry score possible was 300. For the weighed overall number of ex-offenders employed, the industry with the greatest number of ex-offenders employed-adminlstratlve and support services-was given the maximum value of 100 and all other industries were weighed accordingly (1 for every 20.83 ex-offenders employed). For the percent of ex-offenders employed full-time, each Industry was given 1 point for each percent working full-time, so the highest possible score was 100. Lastly, the weighed average quarterly earnings were obtained by using the highest quarterly earnings of any industry-finance and insurance with $8,170.16-and assigning it the maximum value of 100. Industries were then assigned 1 point for each $81.70 of their average quarterly earnings.

As shown on Table 3, the industry with the highest relative industrial score was construction with 192.55, followed by manufacturing with 172.51. As stated earlier, this formula accounts for the number of ex-offenders employed, the percent employed full-time, and average quarterly wages. So even though the administrative and support services industry employed 2,083 ex-offenders in the first fiscal quarter of 2003, Its overall relative industrial score was lowered by its average quarterly earnings and the percentage of ex-offenders employed working full-time. The agriculture (58.07), utilities (73.76), management of companies and enterprises (79.19), and arts, entertainment, and recreation (82.46) Industries had the lowest relative industrial scores.

Discussion

Core Industries and the Employment of Ex-offenders

Over the five year period, from fiscal year 1999 to fiscal year 2003, exoffenders tended to be employed in five core industries: (a) administrative and support services, (b) construction, (c) accommodation and food services, (d) manufacturing, and (e) retail trade. Most of this employment can be partially explained by the industrial growth trends Identified by the Bureau of Labor Statistics (2004), which projects the administrative and support services Industry to grow the fastest and to provide the most new jobs. Furthermore, jobs within the administrative and support service industry, particularly at temporary employment and job placement agencies, provide an entry into the workforce, which is quite suitable for individuals who have been out of the workforce for an extended period of time or with low levels of education. The current growth rate of the construction industry, coupled with its limited job requirements serve as explanations as to why many ex-offenders are employed within it. According to the Bureau of Labor Statistics (2004), there will be 15% growth through the year 2112 and workers enter most jobs In the construction industry without any formal classroom training after high school; therefore, ex-offenders who are able to complete vocational coursework in construction would increase their chances at gaining and maintaining employment within the industry.

Growth and limited job requirements offer an explanation as to why so many ex-offenders are employed within the accommodation and food services and retail trade industries. According to the Bureau of Labor Statistics (2004), most jobs within the accommodation and food services industry are part time and job openings are expected to be abundant through 2012. Furthermore, within the retail trade industry opportunities for part-time and temporary work are plentiful, especially with its traditionally high turnover rate. Unfortunately for ex-offenders, full-time jobs within these two industries, which tend to pay higher hourly wages, require substantial experience; experience ex-offenders typically do not possess.

The only core industry lacking overall expected job growth is manufacturing. According to the Bureau of Labor Statistics (2004), in 2003, the manufacturing industry was the weakest industry in terms of job growth and employment change in manufacturing will vary by individual sub-industry, but overall employment will decline by 1 percent or 157,000 jobs. This suggests that even though employers within the manufacturing industry have previously hired ex-offenders, the decrease in jobs would cause more competition, allowing employers to discriminate against those who have criminal records. Focusing on the first fiscal quarter of 2003, the rank ordering of the industries, in ternis of the number of ex-offenders hired, was the same: (a) administrative and support service, (b) accommodation and food services, (c) construction, (d) manufacturing, and (e) retail trade. However, during the first fiscal quarter of 2003, a difference was noted in the rank order of the core Industries when comparing all ex-offenders employed to ex-offenders employed on a full-time basis. Although employers within the administrative and support services industry hired the most ex-offenders in the first fiscal quarter of 2003, employers in the construction and manufacturing industries employed a greater number of ex-offenders on a full-time basis. According to the Bureau of Labor Statistics (2004), most temporary jobs in the administrative and support services industry require only a high school degree, while some permanent jobs may require a bachelor’s degree or higher. Perhaps this was the reason many exoffenders were able to gain employment within this industry, but only a limited number were able to maintain it.

Professional Industries and the Employment of Ex-offenders

Ex-offenders are less likely to work in industries composed of occupations that are professional, or require stringent licensing or mandatory background checks, provide needed services to the public, or require significant educational achievement. In the first fiscal quarter of 2003, the two professional industries within Virginia with the greatest number of workers on their payroll were health care (10.01%) and public administration (9.36%). It would be reasonable to conclude these same industries would employ the greatest number of exoffenders; however, the public administration and the health care industries employed only 0.28% and 1.82% of the ex-offenders included in this study, respectively. According to the US Bureau of Labor Statistics (2004) the services provided by the health care industry are delivered by trained professionals and many of the occupations are defined based on the educational degree held by the practitioners included in the industry. Due to the low number of exoffenders with the necessary educational backgrounds and the state licensing requirements, the employment opportunities for ex-offenders within the health care industry are limited. Since the enterprises Involved In public administration deliver needed services to the public and require background checks for applicants and at least some post-secondary education, ex-offenders have few opportunities within this industry. Furthermore, public administration agencies set policy, create laws, adjudicate civil and criminal legal cases, provide for public safety and national defense; responsibilities for which this population are not likely to be entrusted.

Some of the other industries that include professional occupations are: (a) information, (b) finance and insurance, (c) educational services, (d) management of companies and enterprises, and (e) professional, scientific, and technical services. Once again, ex-offenders were employed in those industries in limited numbers, and there was a discrepancy between each of the aforementioned industries’ percentage of the total workforce and the percentage of ex-offenders employed. With criminal records, limited educational attainment, and gaps in their employment history, it is highly unlikely ex-offenders would be able to obtain Jobs within the aforementioned industries.

Ex-offenders were also employed in limited numbers in mining, utilities, and agriculture and these industries include occupations typically considered low or semi-skilled. However, when comparing the percentage of ex-offenders within these industries and each industry’s percentage of the total workforce, the percentages were more similar than those of the professional industries. The mining industry employed 0.27% of Virginia’s workforce, and an almost identical 0.30% of employed ex-offenders. The utilities industry employed 0.66% of Virginia’s workforce, and 0.15% of employed ex-offenders. The agriculture industry employed 0.34% of Virginia’s workforce, and 0.45% of employed ex-offenders.

Implications

After giving equal weight to the number of ex-offenders employed, the percent of employed ex-offenders working full-time within the industry, and the average quarterly earnings of ex-offenders within the industry, the construction industry had the highest relative industrial score (see Table 3). This suggests even though jobs within the construction industry do not provide the highest wages, they offer the most Job stability for the greatest number of ex-offenders. This coupled with projected growth within the construction industry suggests vocational training in the construction trades should be an area of emphasis for correctional education. Despite being the only core industry lacking expected job growth, the manufacturing industry had the second highest relative industrial score. For this to continue, additional vocational and soft skill training would be necessary to make ex-offenders more competitive and adaptable within the tighter manufacturing job markets. Employment within the accommodation and food services and administrative and support services industries is a reality for more than a third of ex-offenders and such employment generally lacks upward mobility, stability, and decent pay. Therefore, it would be beneficial to develop strategies to increase the ability of ex-offenders to advance in occupations within those industries. For such advancement to occur, soft and employability skill development would be necessary.

Suggestions for Further Investigation

Current Employment and its Relatedness to Correctional Education

An essential issue within corrections research is the extent to which one’s correctional education/training Is related to his/her current employment. It brings up two questions: (a) are former correctional education participants employed within the industries in which they were trained? and (b) are there specific industries where correctional education participants are more likely to use their training? It would also be interesting to look at the participants of specific vocational programs, such as plumbing, welding, and typesetting, and determine if they find employment within parallel sub-industries.

Further Analysis of Earnings and Employment Patterns

Further analysis of earnings/employment patterns could help determine: (a) the extent to which ex-offenders have more than one employer, (b) the number of times an ex-offender switches jobs and/or industries, (c) the average length of time an ex-offender stays at his/her first job, second job, etc., and (d) whether earnings increase with job tenure and/or survival time. These factors would provide better measures of job stability than what was used in this current study, full-time employment based on wages.

References

Bureau of Justice Statistics (1996). State prison expenditures, 1996. Washington D.C.: Department of Justice. Retrieved June 18, 2004 from: http://search.usdoj.gov/compass?scope=prison+population&ul=sr&viewtemplate=dojsimple.

Bureau of Labor Statistics (2004). Occupational Outlook Handbook, 2004-2005 Edition. Washington D.C.: Department of Labor. Retrieved October 13, 2004 from: http://stats.bls.gov/ovo/home.htm

Elsenberg, M. (1990). Project Rio twelve month follow-up, March 1989 intakes. Austin, TX: Texas Department of Justice.

Fry Consulting Croup (1987). The employment problems of ex-offenders. New York: National Information Center.

Heinrich, S. (2000). Reducing Recidivism Through Work: Barriers and Opportunities for Employment of Ex-Offenders. Chicago, IL: University of Illinois at Chicago Great Cities Institute.

Holzer, H., Raphael, S., & Stoll, M. (2003). Employer Demand for Ex-Offenders: Recent Evidence from Los Angles. Washington D.C.: Urban Institute.

Lichtenberger, E. (2005). Industrial Profile of Employers of Ex-Offenders within Virginia. Richmond, VA: Department of Correctional Education.

Lichtenberger, E. & Morrissey, M. (2004). Follow-up Study of Virginia Department of Correctional Education Participants and Their Respective Employers. Richmond, VA: Department of Correctional Education.

Lichtenberger. E. & Onyewu, N. (2005). Virginia Department of Correctional Education’s Incarcerated Youth Offender Program: A Historical Report. Richmond, VA: Department of Correctional Education.

Morrissey, M, Ogle, J.T., & Lichtenberger, E. (2005). Employment Outcomes for Persons Released From Virginia Correctional Institutions Between January 1999 and June 2002. Richmond, VA: Department of Correctional Education.

Ogle, J.T. & Onyewu, N. (2005). A Description of the Recidivism Patterns of Individuals Released from Virginia Department of Corrections Facilities from July, 1 1998 to August 11, 2004. Richmond, VA: Department of Correctional Education.

Biographical Sketch

Dr. ERIC LICHTENBERGER is a senior research associate for the Center for Assessment, Evaluation, and Educational Programming. Previously he held graduate teaching and research positions at Southern Illinois University and Virginia Tech. He has taught graduate and undergraduate courses in vocational education and human resources. Recently he has been involved in research, evaluation, and database development In the area of corrections education.

Copyright Correctional Education Association Dec 2006

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