Effects of Incarceration on Labor Market Outcomes Among Young Adults

This chapter examines the effect of imprisonment on labor-market outcomes for young adults. The life-course framework suggests that imprisonment may be particularly consequential for young people making the transition to adulthood. It emphasizes the sequential connections between critical life events and the role of early events in establishing trajectories of advantage or disadvantage over the life course. Drawing on data on young adults sentenced for felonies between 2003 and 2006 in Michigan and leveraging a natural experiment based on the random assignment of judges, this chapter estimates the effect of imprisonment versus probation on various employment outcomes. Imprisonment has substantively large negative effects on employment. Effects are largest 1 year after sentencing, when incapacitation removes most prisoners from the labor market, but persist to the 5-year point. Effects are also larger for whites than nonwhites, reflecting low employment among nonwhites in the comparison group.