Justice-Involved Individuals in the Labor Market since the Great Recession

AuthorMichael Mueller-Smith,Keith Finlay
DOI10.1177/00027162211024532
Published date01 May 2021
Date01 May 2021
Subject MatterPopulation Outcomes
ANNALS, AAPSS, 695, May 2021 107
DOI: 10.1177/00027162211024532
Justice-Involved
Individuals in
the Labor
Market since
the Great
Recession
By
KEITH FINLAY
and
MICHAEL MUELLER-
SMITH
1024532ANN THE ANNALS OF THE AMERICAN ACADEMYJUSTICE-INVOLVED INDIVIDUALS IN THE LABOR MARKET
research-article2021
We examine how individuals convicted of a felony or
released from prison have fared in the labor market
since the Great Recession. Using data from thirteen
states in the Criminal Justice Administrative Records
System (CJARS) linked with IRS W-2 information, we
measure the employment and earnings of cohorts with
focal criminal justice events before, during, and after
the recession. These justice-involved cohorts experi-
enced significant declines in employment and earnings
during and immediately after the recession. Outcomes
improved moderately during the long recovery but are
still far below those of a reference group of people
without high school degrees who were not involved in
the justice system. We also correlate the employment
outcomes of the justice involved to industry-specific
local economic performance, finding that expansions in
the construction and other services sectors are posi-
tively correlated with growing employment and espe-
cially earnings.
Keywords: criminal justice; employment; earnings;
Great Recession
The Great Recession (December 2007–June
2009) caused a historic slowdown in the
U.S. labor market. It has since been followed
by a historically long economic expansion (July
2009–January 2020). And while the unemploy-
ment rate has mostly recovered from its peak,
the employment-to-population ratio has
improved much less (Card and Mas 2016). This
finding suggests that a significant proportion of
the working-age population has withdrawn
from the labor force. In this article, we examine
the labor market outcomes of a particularly
marginalized population—individuals who have
been convicted of a felony or have served time
Keith Finlay is a labor economist at the U.S. Census
Bureau, where he uses administrative records to
increase the quality of federal statistical products. He
has published research on the economics of crime, fam-
ily structure, and illegal drug use.
Correspondence: keith.ferguson.finlay@census.gov
108 THE ANNALS OF THE AMERICAN ACADEMY
in prison. Employment is a critical element of reintegration and criminal desist-
ance for these individuals, who we collectively refer to as justice involved (Uggen
2000; Uggen and Wakefield 2008). The potential for recidivism magnifies the
social costs of nonemployment and labor market withdrawal.
Using newly assembled criminal justice administrative data that are linked to
individual IRS W-2 information, we construct a set of cohorts with justice
involvement around the time of the Great Recession and follow their annual
employment and earnings through the recovery. While these groups did experi-
ence some improvement in economic outcomes during the recovery, their aver-
age outcomes remain far below even those of a reference cohort of adults with
less than a high school degree who were not in the justice-involved cohorts. For
some older cohorts of individuals released from prison, outcomes in 2018 are
worse than outcomes before the Great Recession. There also appears to be a
distinct plateauing of the employment rates for all groups in the last few years
of our study period, despite a continuing economic expansion. We further exam-
ine the local labor markets in which these justice-involved cohorts participate
and find that these groups have greater improvement in earnings when the
construction and other services sectors are growing in their local labor
markets.
Criminal Justice and Earnings Administrative Data
To link the justice-involved population with socioeconomic data and outcomes,
we use data from the Criminal Justice Administrative Records System (CJARS)
project (Finlay and Mueller-Smith 2021). CJARS is a nationally integrated repos-
itory of data following individuals through the criminal justice system. The
2020Q4 vintage of CJARS has statewide coverage of at least the state court sys-
tem or the state department of corrections from 2006 to 2011 in thirteen states
that represent more than 40 percent of the U.S. population: Arizona, Florida,
Maryland, Michigan, Nebraska, New Jersey, North Carolina, North Dakota,
Oregon, Pennsylvania, Texas, Washington, and Wisconsin. Using the Protected
Identification Key (PIK) available in the Federal Statistical Research Data
Centers, we integrate CJARS at the person level with four noncrime datasets:
(1) the Census Numident file to identify birthdate, place of birth, gender, and
Michael Mueller-Smith is an assistant professor in the Department of Economics at the University
of Michigan and a faculty associate in the Population Studies Center. His research examines
topics related to the economics of crime, discrimination, and public assistance programs.
NOTE: This project has been supported by the National Science Foundation, the Gates
Foundation, and the Arnold Foundation. We thank the editors, the conference participants,
and U.S. Census Bureau reviewers for feedback. Any views expressed herein are those of the
authors and do not necessarily represent the views of the Census Bureau. All results were
approved for release by the Disclosure Review Board of the Census Bureau, authorization
number CBDRB-FY21-ERD002-017.

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