In neoclassical economics theory, labor market discrimination is defined as the different treatment of two equally qualified individuals on account of their gender, race, disability, religion, etc.
For example, the feminist economist Deborah Figart (1997) defines labor market discrimination as "a multi-dimensional interaction of economic, social, political, and cultural forces in both the workplace and the family, resulting in different outcomes involving pay, employment, and status.
Other studies on relatively homogeneous group of college graduates produced a similar unexplained gap, even for the highly educated women, such as Harvard MBAs in the United States.
[12] It is possible to investigate hiring discrimination experimentally by sending fabricated job applications to employers, where the fictitious candidates differ only by the characteristic to be tested (e.g. ethnicity, gender, age...).
[13] A meta-analysis of more than 700 correspondence test conducted between 1990 and 2015 concluded that "[ethnic] minority applicants have 49% lower odds to be invited for an interview, compared to the equally qualified majority candidate".
Based on more than 3 million profile views, they found that "immigrant and minority ethnic groups face a substantially lower contact rate compared to native Swiss citizens".
The study ran a field experiment of 49 male and 63 female employees from 72 retails stores and 40 restaurants with price points that targeted mid-income level clientele.
[19] 1.9% and 1.2% lower salaries (men and women) Darity and Mason [1998] summarize the court cases on discrimination, in which employers were found guilty and huge awards were rewarded for plaintiffs.
Some examples are the following: In 1997, the allegations for the Publix Super Markets were "gender biases in on the job training, promotion, tenure and layoff policies; wage discrimination; occupational segregation; hostile work environment" (St. Petersburg Times, 1997, pp. 77).
The six black workers, who were the plaintiffs, gave the taped racist comments of the white corporate officials as evidence (Inter Press Service, 1996; The Chicago Tribune, 1997).
In 1993, the Shoney International was accused of "racial bias in promotion, tenure, and layoff policies; wage discrimination; hostile work environment (The New York Times, 1993, pp.
New mothers feel the pressure from their workplace to come back as soon as possible after giving birth which puts them in a tight spot trying to be there for their children and also finding caregivers for them that leads to stressful situations.
A separate study found out majority believed in "women, more than men, manifest leadership styles associated with effective performance as leaders,… more people prefer male than female bosses".
[34] Neoclassical economics ignores logical explanations of how self-fulfilling prophecy by the employers affect the motivation and psychology of women and minority groups and thus it alters the decision making of individuals regarding human capital.
[37] Discrimination litigation can be very expensive when taking into account the time spent in court and the outcome of the ruling where the possibility of settlement money comes in to play as well as "hiring, promotion, backpay, or reinstatement" for the prosecutor.
Some see these employees as an "untapped niche"[37] (a small, specialist field or group that has not been used to its full potential) especially since diversity management is positively correlated with corporate financial performance.
The interviews, personal law, wage data and confidential employment records with salaries along with other evidence show gender segregation and its effects on the labor market.
[2][6] Executive Order 11246, which is enforced by the Office of Federal Contract Compliance, is an attempt to eliminate the gap between the advantaged and disadvantaged groups on account of gender and race.
The Department of Labor has several employment training programs and resources targeted to support dislocated workers, Native Americans, people with disabilities, seniors, veterans, at risk youth, and other minorities.
Through organizing heterogenous work groups, interdependence, recognizing the influence of salience, creating formalized evaluation systems, and taking accountability of actions, companies can improve current discriminatory practices that may be occurring.
With a formalized evaluation system that includes objective, reliable, specific, and timely performance data, employers can put their best foot forward in managing a fair, non-discriminatory workplace.
[57] After a study found a substantial increase in hiring equity, some musical organizations have adopted the blind audition; in other fields like software engineering, communications, and design, this has taken the form of an anonymized response to a job application or interview challenge.
[90][91][92][93][94][95][96] A 2019 cross-national field experiment looking at 5 European nations, found that in the UK, Norway and the Netherlands, there was Anti-Muslim and origin based discrimination against job applicants in the private sector.
[98] Furthermore, European studies provide evidence for hiring discrimination based on former unemployment,[99][100] trade union membership,[101] beauty,[102] HIV,[103] religion,[104] youth delinquency,[105] former underemployment,[100] and former depression.
[112] In Canada, a 2019 journal article drew data from the 2011 National Household Survey which after filtering for labor market relevant responders, had a sample size of 192,652 records.
The study not only resulted in a lower average score graded by the first group (3.2 to 4.1 on a scale from 1 to 5,) but also the viewers inserted more captious grammar and spelling errors significantly when they believed the writer to be African American.
[123] Heckman's argument is based on a series of papers utilizing the Armed Forces Qualifications Test (AFQT) scores reported in the National Longitudinal Survey of Youth.
The papers utilize empirically based approach suggesting that an individual's position in the skill distribution is influenced by the decisions made reconsidering the cost and benefit of acquiring certain jobs.
"As an amendment to the Fair Labor Standard Act, it exempted employers in agriculture, hotels, motels, restaurants, and laundries, as well as professional, managerial, and administrative personnel, outside salesworkers, and private household workers".
[130] Additionally, 27 states do not have statewide laws for protecting LGBTQ people from discrimination based on sexual orientation or gender identity in employment, housing, and public accommodations.