Direct Incentives May Increase Employment of People With Criminal Records

Although society benefits when people with criminal records are employed, employers are reluctant to hire them. Can we diminish this reluctance with direct incentives that reduce the cost of employing people with records or that compensate for the associated risk? If so, will the beneficial effects of incentives emerge under traditional hiring, where criminal history information is available at the outset for the choice between applicants, and under Ban-the-Box, where it is not? To answer these questions, we conducted preregistered experiments with a national sample of hiring decision-makers. The experiments included a conjoint analysis, which presented participants with 14,000 applicant profiles and corresponded to traditional hiring, and a picture-based factorial vignette, which approximated Ban-the-Box by focusing on tentatively hired employees later discovered to have records. Evidence emerged that a $2,400 tax credit and $25,000 insurance against losses from employee dishonesty both increased the hiring of people with criminal records. These direct incentives were effective under traditional hiring and under Ban-the-Box, and they were effective regardless of whether applicants had misdemeanor or felony convictions. Rehabilitation certificates also had beneficial effects on hiring in the Ban-the-Box scenario.