When Congress enacted the Civil Rights Act of 1964, the unemployment rate for black men and women was double that for whites. Much of this difference, proponents of the Act argued, was the result of discrimination by employers, unions, and employment agencies. By prohibiting such discrimination, Title VII of the Act was to win access for blacks to jobs formerly closed to them -- it would reduce black unemployment and enable them to move along with whites on the road to economic success.
More than thirty years later, after the development of new, sweeping definitions of discrimination, the expenditure of hundreds of millions of dollars to enforce Title VII and other equal employment opportunity (EEO) laws and regulations, and victory by black workers in thousands of employment discrimination cases, the unemployment rate for black men and women is -- double that for whites.
It is this conundrum which motivates Farrell Bloch's book. Why has EEO law (including, for our purposes, executive orders and regulations) proven to be so ineffectual? Why have the hopes of those who fought so long and so hard for Title VII not been fulfilled?
Bloch proposes four reasons. First, although the federal government apparently has the power to get employers it monitors closely -- large employers and federal contractors -- to hire more blacks, the blacks they recruit are apparently those who would be employed anyway, at smaller firms and firms without federal contracts. The latter apparently do NOT make up for their loss of black employees by hiring from among the black unemployed. Net result: no gain in total black employment.
Second, Bloch claims, the EEO laws may actually discourage employers from hiring blacks. Although the laws prohibit discrimination both in hiring and on the job, applicants are much less likely than employees to file discrimination lawsuits. For employers, therefore, it may make sense to avoid hiring potentially litigious applicants in the first place.
Third, much hiring is done through word-of-mouth recruitment. With proportionately more whites and Asians than blacks in a position to hire (because they control most firms), such recruitment disadvantages blacks; yet it is difficult to see how the EEO laws can prevent people from using their personal contacts to find work. Finally, Bloch argues, some criteria employers use to screen applicants exclude blacks disproportionately often -- an example is having a criminal record.
All of these arguments have been made before, but it is not Bloch's goal to be original. Instead, he wants to (1) summarize what is known about the impact of EEO law for a "diverse audience, including students, human resources professionals, and attorneys"
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as well as social scientists (p. 5); (2) place particular emphasis on how recruitment practices affect racial differences in unemployment; and (3) propose more effective ways of reducing black unemployment.
Bloch's summary of others' work on the impact of EEO law would in fact be useful for its intended audience; it is wide-ranging, accurate and easy to comprehend. Nevertheless, it is problematic in at least two important ways not necessarily obvious to its intended audience.
First is Bloch's attempt to focus on unemployment rather than on earnings or access to occupations. There are good reasons to be concerned about black-white differences in unemployment; the unemployed not only have lower incomes than the employed, but they are also less attached to major institutions, less likely to form stable families, and less likely to contribute to community life in constructive ways. Nevertheless, most work on the impact of EEO law rightly focuses on how it affects earnings or access to occupations; most adults are employed, and it is how well they are doing which is most important for assessing group progress.
As it turns out, Bloch is partially saved by his own inconsistency. He says his focus is unemployment, but he actually summarizes work on earnings and access to occupations as well. Bloch's readers will thus learn more than he promises. Unfortunately, they may also come away with a somewhat confused impression of work on EEO law because of Bloch's failure to distinguish carefully between its impact on unemployment, on earnings, and on access to occupations.
The second way in which the summary is problematic lies in its treatment of theory and evidence. Bloch presents his argument rather informally, mixing economic theory, legal analysis, summaries of others' empirical work, U.S. government statistics, and anecdotes about particular EEO cases. Such informality arguably makes sense, given the intended audience. Yet such informality may -- and in this case, does -- have a price. Much of what Bloch says about the apparent weakness of EEO law rests on economic theory: for example, how employers wishing to avoid being sued have incentives not to hire blacks, or why employers find it especially efficient to recruit employees through word-of-mouth, to the detriment of blacks. Only the most careful and methodologically sophisticated reader is likely to notice how little hard evidence there is to support the theoretical arguments. Most of what Bloch says will seem plausible, or even convincing, to those inclined to accept the economic arguments on which it rests. But those who would like to know whether it is really true that employers resist hiring blacks because they believe that reduces their exposure to litigation, will not find the evidence in Bloch's book.
To be fair, the evidence is not in Bloch's book because it is simply not available anywhere. At times, Bloch acknowledges that his conclusion that EEO law has had little impact could be undermined by evidence not yet available -- evidence showing, for example, that the impact of EEO law has been underestimated because it has been offset by the loss of manufacturing jobs,
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the impact of inner-city crime and other factors. He fails, however, to point out how little evidence there is for many of the points in his theoretical argument; it would be very easy for the reader to come away from his book thinking we understand far more about black unemployment or earnings than we actually do.
Bloch's book also reflects another weakness of others' work on EEO law: like many of the economists whose work he cites, he claims to be writing about MINORITIES, but really focuses almost entirely on MINORITY MEN. He shows that black women as well as men suffer from much higher unemployment rates than whites, but fails to note that their earnings and access to occupations have improved more rapidly than black men's, almost certainly due in part to EEO law. Indeed, black women's earnings approach those of white women, and some social scientists have argued that although black women continue to suffer from sex discrimination, they are harmed relatively little by race discrimination in the labor market.
Bloch's (and others') neglect of black women is objectionable not only in principle, but because it affects the credibility of his argument as well. Bloch attributes the apparent failure of EEO law in part to blacks' isolation from jobs and recruitment networks, and in part to the incentives EEO law inadvertently gives employers to avoid hiring members of protected groups. His logic should apply to black women as well as men, yet they do not seemed to be harmed to the same extent. The book would be more convincing if it considered not only why EEO law is likely to be ineffective, but also why it may be less ineffective for some groups than for others.
Bloch's policy proposals are for the most part quite conventional among economists: he argues that employment opportunities for blacks would be improved by full employment, reducing or eliminating the minimum wage and occupational licensing requirements, reducing taxes, expanding particular kinds of job-training programs, reducing inner-city crime, and encouraging the growth of black-owned businesses. His own, new proposal calls for making it easier to disseminate information about jobs and job applicants through interactive telephone communication of the sort people use to get information about their bank accounts.
Overall, Bloch's book is useful in two ways. First, he effectively summarizes much of what we know about the impact of EEO law. Second, he argues convincingly that social and economic processes beyond the reach of EEO law -- particularly informal recruitment to jobs, the development of entrepreneurship in minorities communities, and the disintegration of inner cities -- work strongly to the disadvantage of blacks. Nevertheless, those wanting a sophisticated and non-technical introduction to EEO law and its consequences would still find it especially worthwhile to read Alfred Blumrosen's MODERN LAW (University of Wisconsin Press, 1993) and the well-known exchange between James Smith and Finis Welch on one side and John Donohue III and James Heckman on the other ("Black Economic Progress After Myrdal,"
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JOURNAL OF ECONOMIC LITERATURE 27 [1989]:519-54, and "Continuous versus Episodic Change: The Impact of Civil Rights Policy on the Economic Status of Blacks," JOURNAL OF ECONOMIC LITERATURE 29 [1991]:1603-43).
