The Employment Effects of Ban-the-Box Preemption: Evidence from Indiana's Senate Bill 312

Abstract

In 2017, Indiana became the first U.S. state to preempt local "ban-the-box" (BTB) ordinances, prohibiting local governments from restricting employers' ability to inquire about criminal history during hiring. Using a difference-in-differences design comparing Indiana to neighboring Midwestern states with Census PUMS microdata from 2014 through 2019, comprising 1.48 million working-age observations, I examine whether this policy reversal affected labor market outcomes. The main estimate suggests Indiana's employment growth lagged control states by 0.50 percentage points after preemption. However, this effect is not concentrated among demographic groups most likely affected by criminal record screening. Young Black males with less than an associate's degree—a proxy for high criminal record exposure based on documented disparities in criminal justice contact—show essentially no differential effect at +0.04 percentage points. Furthermore, the placebo group of college-educated workers exhibits a similar-magnitude effect, raising concerns about identification. These null findings suggest that BTB preemption had limited labor market impact, potentially because the preempted Indianapolis ordinance had narrow scope covering only city contractors and public sector workers, or because private employers already extensively used criminal background checks regardless of local BTB policies. This paper provides the first empirical evidence on what happens when ban-the-box protections are removed, contributing to ongoing policy debates about the effectiveness and appropriate scope of criminal record screening regulations.