How Can Fair Chance Hiring Solve the Labor Shortage

Discover How fair chance hiring can help solve the labor shortage and support DEI programs.

May 24, 2023

Fair Chance Hiring

We need to address the labor shortage that exists today. Ken Oliver, VP of Checkr, advocates fair chance hiring, offering opportunities to rehabilitated individuals, and building a diverse, inclusive, and successful workforce.

Despite regular news stories surrounding tech industry layoffs and a potential recession, U.S. companies struggle with a prolonged labor shortage. Recent U.S. Chamber of Commerce data shows that more than 10 million jobs must be occupied, while the pool of job seekers stands at less than six million. This is a simple math problem: expanding the labor pool to introduce more workers will allow more people to fill open positions and drive economic growth.

The outlook for the future of work looks the same. According to data from the U.S. Census Bureau, all baby boomers will have reached the age of 65 by 2030. Birth rates continue to decline in the United States as Millennials and Gen Z postpone having children. These generational shifts put tremendous pressure on the economy and hamper businesses’ efforts to grow and scale.

A solution has started gaining traction with businesses nationwide – a fair chance of hiring. Nearly 80 million people have a criminal record. These people are frequently filtered out of applicant pools based on these records and deny a willing workforce the opportunity to access livable wage employment and successfully contribute to the economy. This trend has gained momentum in all sectors, even in the highest levels of the federal government. The Fair Chance to Compete for Jobs ActOpens a new window went into effect, prohibiting federal agencies and contractors from requesting information about a candidate’s arrest and conviction record until after a job offer. This legislation is a major step in the right direction. By adopting fair chance hiring practices, companies can significantly expand their hiring pool, bolster DEI initiatives, and make a tangible difference in their surrounding communities.

See More: How Committed Are You To DEI?

The Challenge for Talent With Records

People with arrest or conviction records face more than 48,000 collateral consequences (federal and state statutes, regulations, and civil disabilities) that can prevent them from gaining full-time employment and accessing economic mobility. Companies that ask applicants to check a box if they have previously been convicted of a misdemeanor or a felony unceremoniously screen out millions of qualified job candidates before understanding the life circumstances of the arrest or conviction. 

Some tools use artificial intelligence to reject these candidates without reaching a human reviewer. But even beyond these obvious cases, some applicants need help landing interviews due to gaps in their resumes. The result is a 27% unemployment rate, a labor shortage, and businesses searching for new ways to source and cultivate talent. Businesses can solve one of this country’s most pressing economic challenges by drawing from this untapped talent pool.

Campaigns like “Ban the BoxOpens a new window ” encourage companies to delay asking about criminal histories until after a conditional job offer. This shift in the process allows organizations to assess candidates for their skills and knowledge before learning more about their backgrounds. Companies often recognize that the candidate’s criminal background does not rule them out as potential employee. Organizations that take these steps to consider candidates who have previously been overlooked will find themselves with a significant competitive advantage as they aim to increase staff during a tight labor market.

See More: Addressing Resume Gaps in the Tech Industry

The Business Case for Fair Chance Hiring

Fair chance hiring doesn’t just impact the person being hired but also delivers outsized benefits to the company. In a recent podcast appearance, Jeff Korzenik, chief economist at Fifth Third Bank, remarked on the impact these hires could have on an organization. “When you hire someone ready to turn their life around and wants to prove that they are more than their worst mistake, they’re not just an average employee. They’re an exceptionally engaged and loyal employee,” remarked Korzenik.

When an organization gives a candidate with a criminal record a chance, they are repaid with strong performance and exceptional loyalty. A recent analysis from ReutersOpens a new window found that employee turnover rates are lower with employees with criminal records. At the same time, 81% of businesses said employees with criminal records maintain the same performance as those without criminal records in a 2021 surveyOpens a new window by Getting Talent Back to Work.

Providing access to employment, skill development, and economic mobility to talent with records is a win-win-win for business, the economy, and the health and well-being of our local communities.   

Creating Opportunities for Success

Most employers have introduced new programs to improve their organizations’ diversity, equity, and inclusion. These businesses recognize the need to repair historical inequities and build diverse and representative organizations. Because the pool of justice-impacted applicants has a disproportionate number of BIPOC candidates, fair chance hiring enables business leaders to accelerate their DEI efforts while filling critical job roles.

A company’s DEI initiatives shouldn’t just be about balancing statistics or meeting quotas. Justice-impacted employees bring unique lived experiences to the workplace, enriching debates and strategies with their perspectives. For example, after serving four years in federal prison, Shelley Winner became the world’s No.1 B2B Surface product salesperson last year at Microsoft. 

At Nike, Larry Miller became the chairman of the Jordan Brand and later the president of the NBA’s Portland Trail Blazers after serving ten years in prison as a young man. And there are thousands of more stories about amazing individuals who had overcome the odds of making a poor decision to achieve incredible success when they were given access and the opportunity.

While every fair chance hire won’t go on to be a Shelley Winner or Larry Miller, many will become the backbone of our future labor force in roles on the ladder from entry-level to the C-Suite. Organizations that commit to fair chance hiring have the opportunity to ensure that their new employees are supported throughout onboarding, training, professional development, and, ultimately, leadership. Mentorship, employee resource groups, and professional development opportunities provide the sense of inclusion needed for justice-impacted employees to succeed in their new roles. 

Investing in this swath of the workforce is an untapped goldmine that can yield riches in diverse perspectives and lived experiences to forward-looking organizations. This approach also cultivates diverse and inclusive teams who are more readily able to effectively solve the challenges facing businesses as they look to the workforce of tomorrow.

What steps have you taken to embrace fair chance hiring to unlock talent, drive innovation, and overcome the labor shortage? Let us know on FacebookOpens a new window , TwitterOpens a new window , and LinkedInOpens a new window . We’d love to hear from you!

Image Source: Shutterstock

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Ken Oliver
Ken Oliver is the Vice President of Checkr.org and the Executive Director of the Checkr Foundation, Checkr’s philanthropic arm. Previously, he served as the Executive Director of the CROP Organization, a reentry service provider based in Oakland, CA. In 2021, Ken led an effort to secure a historic $28.5M investment from the State of California to develop the first residential and tech-centered workforce development program for formerly incarcerated people in the country. After having spent 24 years himself in the labyrinth of California’s criminal justice system, more than 8 of which in solitary confinement, Ken emerged to become a certified paralegal and policy director for a public interest law firm.
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