Arguing against discrimination in hiring really isn't difficult. Simple human decency suggests that people should be judged on their merits as individuals, not their gender, race, religion, disability status, and so on. Plus, there's the obvious business case against discrimination. Those who let bias interfere with hiring are missing out on valuable talent and a variety of, business-boosting perspectives.
But yet science is pretty conclusive on the subject: intended or not, hiring discrimination continues to be a real problem.
One recent study, for instance, found that those with stereotypically "black-sounding" names were 50 percent less likely than those with "white-sounding" names to get a call back from an employer for an equally impressive resume. Another depressing study found that managers were twice as likely to hire a man than a woman for a simple job for which they were equally qualified.
So obviously, the common sense arguments aren't enough to push many hiring managers to figure out how to remove bias from the hiring process. Maybe the findings of a new study will be.
Dude, you're destroying your business.
The research was done by Devah Pager, a sociologist at Harvard, and was highlighted on the always interesting Marginal Revolution blog. For the study, Pager looked back at a previous study she did with colleagues in 2004. For that earlier research they examined the hiring of New York city businesses, finding that at many companies, resumes from applicants of color received significantly fewer callbacks that those from white candidates.
For the new research, Pager revisited the businesses she first studied more than a decade ago. How had the companies in the sample that discriminated fared compared to those who showed no sign of bias in their hiring?
Here's Pager's bottom line results, summed up by Marginal Revolution's Alex Taborrok: "She finds that 36 percent of the firms that discriminated failed but only 17 percent of the non-discriminatory firms failed."
In other words, discrimination in hiring more than doubles the chance of your business failing.
Unintentional discrimination is still a huge red flag.
Now, discrimination itself might not be the problem, Tabarrok notes. It might just be that the type of businesses who end up accidentally discriminating because of their gut-driven, shoot-from-the-hip hiring style, also are generally less well run. But still the conclusion is extremely worrying for businesses that haven't thought through how to eliminate bias when hiring.
As Pager puts in, "whether because of discrimination or other associated decision making, we can more confidently conclude that the kinds of employers who discriminate are those more likely to go out of business. Discrimination may or may not be a direct cause of business failure, but it seems to be a reliable indicator of failure to come."