Effect on Employment
The Labor Department’s Office of Federal Contract Compliance Programs (OFCCP) administers Executive Order 11246, which imposes nondiscrimination and affirmative action obligations on most firms that contract to do business with the Federal government. According to five academic studies, active enforcement by OFCCP during the 1970s caused government contractors to moderately increase their hiring of minority workers. (22) According to one study, for example, the employment share of black males in contractor firms increased from 5.8 percent in 1974 to 6.7 percent in 1980. In non-contractor firms, the black male share increased more modestly, from 5.3 percent to 5.9 percent. For white males, the employment share fell from 58.3 percent to 53.3 percent in contractor firms, and from 44.8 percent to 41.3 percent in non-contractor firms. (23)
The literature also finds that contractor establishments that underwent an OFCCP review in the 1970s subsequently had faster rates of white female and of black employment growth than contracting firms that did not have a review. (24)
Other than studies comparing employment records of government contractors with non-government contractors, it is hard to separate the effects of affirmative action from broader civil rights enforcement. Non-government contractors often took active steps to ensure diversity and compliance with equal opportunity laws, even though they were not covered by the OFCCP. Some, or perhaps much, of this behavior may be attributable to government anti-discrimination efforts. Also, the recruitment efforts of both contractors and non-contractors may have bid up the wages of minorities and women, reducing wage disparities regardless of the effect on occupational disparities.
The Term Paper on Contemporary Issues in Work and Occupations: Precarious Employment
Employment is of various forms. An employee can work on temporary terms, permanent terms, under contract terms, or under subcontract terms. In temporary employment terms, there are the temporary employment relationships. Contract and subcontract terms of employment are defined under certain rights and responsibilities that are specified under the labor law to govern the agreement terms of the two ...
OFCCP enforcement was greatly scaled back during the 1980s. For example, the real budget and staffing for affirmative action programs was reduced after 1980. Over the same period, fewer administrative complaints were filed and back-pay awards were phased out. Perhaps not surprisingly, available evidence suggests that OFCCP did not have a noticeable impact on the hiring of minority workers by contractor firms in the early and mid 1980s. (25)
Although the literature clearly shows that, when actively enforced, affirmative action can lead to an increase in minority employment in contractor firms, some have questioned whether this employment represents a net gain or merely a shift of minority employees from non-contractors to contractors.
The extent to which affirmative action has expanded minority employment in skilled positions is unclear. The academic literature suggests that before 1974, minority employment growth in contractor firms was predominately in unskilled positions. Since 1974, there is evidence of modest occupational advance in contractor firms. But some researchers think this may be the result of biased reporting. (26)
There is no systematic qualitative evidence that productivity is lower in contracting firms as a result of OFCCP. The one systematic study found that contractors do not appear to have lower productivity, suggesting that OFCCP has not caused firms to hire or promote less qualified workers. (27)
