Employment Processes as Barriers to Employment in the Lower-Wage Labor Market: Literature Review

What does existing research tell us about:

1. The persistent and emerging sources and forms of racial bias in the lower-wage labor market?  
2. How bias is manifested in different employment processes, from recruitment through job separation or advancement?
3. The effect of different types of bias on the employment outcomes of workers of color?
4. Areas for future research that hold promise for reducing racial bias in employment processes?   

This literature review aims to contribute to the advancement of knowledge that can support efforts to reduce employment barriers resulting from racially biased employment processes. It does so by summarizing existing research on racial bias in the lower-wage labor market to help identify promising strategies to address racial bias in employment processes and suggests new areas for future research to better understand aspects of racial bias and the prospects of those promising strategies to mitigate bias.

Racial bias has been found in all employment processes from how employers source candidates to hiring decisions, job assignment, employee development and support, advancement and termination. Bias can take many forms. Some forms are direct, where racist beliefs are ingrained in an individual’s actions or in business processes, policies, and systems. Hiring managers’ negative stereotypes about workers of color that lead to less hiring of Black or Hispanic workers is an example of direct bias. Such bias can be explicit, where the actor is aware of their racial bias, or implicit, where the actor is unaware of their racial bias. Racial bias within employment processes can also be indirect, where an individual’s actions or business processes, policies, and systems are on their face racially neutral, but nonetheless have disproportionately adverse effect on certain racial/ethnic groups. Often, indirect bias results from the interplay of employment processes with existing structural racism within U.S. society that affects where people live, who is in their social networks, their educational attainment, criminal legal system involvement, and access to technology. For instance, requiring college degrees in hiring can disadvantage workers of color who possess the skills to succeed in those jobs because of discriminatory policies that have historically prevented individuals of color from accumulating wealth needed to access higher education.

Whether racial bias is direct or indirect, explicit or implicit, is not always clear or mutually exclusive. In recognizing these diverse sources of bias, it is important to expand understanding of the possibilities for disrupting racial bias in employment processes beyond direct and explicit types of discrimination.

We searched research databases and the internet for studies from multiple disciplines that analyze aspects of racial bias in employment processes in the lower-wage labor market. Our review included both qualitative and quantitative descriptive studies of how bias manifests, as well as causal studies of the impact of bias on employment outcomes. Reviewers systematically extracted information on those studies, which senior researchers then analyzed to identify themes. 

This literature review makes evident that additional research is needed not only to better understand the nature and effects of racial bias in employment processes in the lower-wage labor market, but also to identify effective strategies to disrupt this bias. The review identifies four priorities for further research based on their potential to yield actionable evidence for disrupting racial bias in employment processes: (1) creating greater transparency on the extent of bias and equity in employment processes, including the development of “equity metrics” and more effective ways to use existing metrics to inform decision-making regarding how employment processes are designed; (2) informing equitable use of technology to disrupt racial bias; (3) identifying the interrelatedness of various forms of bias in employment processes, and the constellation of conditions necessary to deliver more equitable employment outcomes; and (4) more deeply engaging workers of color in evaluating and reinventing employment processes to develop effective ways of disrupting racial bias.