Abstract
We compare the employment of African American and white youth as they transition to adulthood from age 18 to 22, focusing on high school graduates and high school dropouts who did not attend college. Using OLS and hazard models, we analyze the relative employment rates, and employment consistency, stability, and timing, controlling for a number of factors including family income, academic aptitude, prior work experience, and neighborhood poverty. We find white high school graduates work significantly more than all other youth on most measures; African American high school graduates work as much and sometimes less than white high school dropouts; African American dropouts work significantly less than all other youth. Findings further suggest that the improved labor market participation associated with a high school diploma is higher over time for African Americans than for white youth.
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Notes
One element of Heckman’s (1998) criticism is that employers and audit-study designers may be attuned to different observable characteristics—and while audit studies match fake job applicants on one set (e.g., résumé, attire, comportment), employers may observe and focus on additional features, still unrelated to race, that study-designers may not know or match on. Therefore, the job applicants are not truly identical from an employer’s perspective.
Youth who graduate from high school after their 18th birthday may be at a disadvantage relative to other youth in the employment outcome variables, which are measured from the 18th birthday. To determine whether this effect is significant, we performed a sensitivity analysis by adding a control variable for the number of months after age 18 that a youth graduated from high school. This variable was set to zero for drop outs and youth who graduated before they turned 18 (since these youth would not be in school when their employment outcomes were measured). Qualitatively, the results for all of the sensitivity analyses were identical to the analyses presented here, suggesting that the birth dates of the youth had no impact on the analyses. In some cases the estimated coefficients changed by adding this control variable, but none of the conclusions of the paper, and none of the disparities between white graduates, white drop outs, African American graduates, and African American drop outs reported in the paper changed in the sensitivity analyses.
As a robustness check, the regression models were also conducted using a censored normal model and a negative binomial model. African American graduates and dropouts, as well as white dropouts performed substantially worse than white graduates in all of these models, relative to the OLS models presented in the paper. In that sense, the results presented in this paper represent the most conservative results produced out of all the model specifications that were conducted. Censored normal and negative binomial results are available from the authors on request.
As a robustness check, the accelerated failure time models were also conducted using the log-logistic distribution. None of the qualitative results changed as a result, although estimated time to failure relative to the reference group of white high school graduates was somewhat longer. Therefore, the Weibull distribution results reported here can be considered conservative estimates of racial disparities in time until employment. Log-logistic distribution results are available from the authors on request.
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We are extremely grateful to Harry Holzer, Margaret Simms and Ajay Chaudry, and our anonymous reviewers for helpful feedback on earlier drafts. We would also like to thank Jennifer Macomber and Michael Pergamit for motivating our research through their leadership on a companion research project using the 1997 NLSY. The study was supported by the Annie E. Casey Foundation through the Urban Institute’s Low Income Working Families project. The findings and conclusions expressed are those of the authors and do not necessarily reflect the views of the Annie E Casey Foundation, or the Urban Institute, its trustees, or its sponsors.
Appendix
Appendix
Consistent with prior work on the treatment of the GED in the labor market (Cameron and Heckman 1993; Heckman et al. 2010), this study has categorize GED recipients as dropouts. This is not the only possible categorization of GED holders. The appendix presents results of the full model (Model 4) presented in Tables 2, 3, and 4 after separating GED holders from dropouts. All of the covariates held constant in Model 4 of Tables 2, 3, and 4 are controlled for in Table 5, but their coefficients are not presented here.
Almost all of the findings from the models that included GED holders with dropouts are maintained in Table 5. The difference in employment between African American graduates and dropouts is still wider than the gap between white graduates and white dropouts at age 18 and age 22, with the greatest difference appearing by age 22, suggesting that a high school diploma confers even greater employment benefits on African American youth than white youth. One difference with that emerges when GED earners are separated from dropouts is that white dropouts have lower employment rates than white graduates at age 22. When GED earners were included in this category, white dropouts and graduates performed comparably in employment at age 22. This suggests that white GED holders have better employment outcomes than white dropouts (although still not as strong as white high school graduates). However, the racial difference in the employment effect of a high school diploma is maintained.
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McDaniel, M., Kuehn, D. What Does a High School Diploma Get You? Employment, Race, and the Transition to Adulthood. Rev Black Polit Econ 40, 371–399 (2013). https://doi.org/10.1007/s12114-012-9147-1
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DOI: https://doi.org/10.1007/s12114-012-9147-1