Discrimination in Low Wage Labor Markets: Findings from an Experimental Audit Study in New York City

Devah Pager, Princeton University
Bruce P. Western, Princeton University

Little is known about the extent of employment discrimination against minorities and criminal offenders. Vast disparities can be observed in employment rates by race, ethnicity, and incarceration status, but the causes of these disparities remain controversial. Unobserved skill differences and the self-selection of workers into segregated labor markets prevent us from directly comparing the outcomes of various groups using standard data sources. Our paper reports new results from a novel study of employers. Using an experimental audit methodology, we sent teams of male testers with equivalent resumes to apply for entry-level jobs in New York City. Our results indicate that employers do treat job seekers differently on the basis of race and criminal record, even relative to otherwise equally qualified applicants. These findings are consistent with the hypothesis that employer discrimination along the lines of race, ethnicity, and criminal conviction status remains a salient source of inequality in contemporary urban labor markets.