Study: Bias traps minorities in low-wage jobs

Discrimination in hiring and promotions creates what is known as occupational crowding: when different demographics are pushed into or out of certain job positions, regardless of their degree or experience.

Urban Institute released a new study on the topic, revealing that hiring managers and employers may reserve higher-paying roles for white workers and exclude qualified workers of color and women. Workers can be excluded from obtaining higher paying jobs during the hiring or promotion process.

The occupational crowding theory was developed by economist Barbara Bergmann, who hypothesized that even when black people are qualified for high-paying roles, they are often excluded from these positions and left to assume low-paying roles due to employer discrimination.

This redistribution creates unequal opportunities for certain demographics, where black workers are overrepresented in low-paying occupations, and white workers are overrepresented in high paying occupations. Studies show a higher representation of black workers in sales, service, production and transportation, in contrast to high paying management roles.

While economic theories attribute occupational segregation to educational attainment, occupational crowding controls this factor. Discrimination plays a significant role when certain groups are disproportionately crowded into more vulnerable occupations.

Employment has grave implications for workers’ wellbeing. Black women are more underrepresented in higher paying occupations across both race and gender—in contrast with white men, white women, and black men. Urban Institute’s research highlights the importance of ensuring black women’s equitable access to more secure employment, whether in the application or promotion stage.

Related: Why a diverse benefits industry matters (and how to make it happen)

Researchers suggest the Equal Employment Opportunity Commission (EEOC) conduct a proactive audit of employers to assess the level of discrimination in their hiring process, instead of waiting for any complaints to be filed. In addition, greater union coverage tends to raise wages, strengthen benefits, and maintain schedule reliability.

Ensuring that protections exist for workers regardless of demographic is a priority. Discrimination in the hiring and promotion process leads to occupational crowding, and creates unequal opportunities and outcomes for much of the workforce, negating their education status or prior work experience.