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Discrimination is an invisible, but actual barrier. It not only prevents part of the population from accessing the same benefits and opportunities as those who are not discriminated against, but it also slows down the development of our region. Discrimination can take many shapes and forms and manifest in multiple places. Did you know that two people with the same experience and training may have different opportunities if one of them lives in a vulnerable neighborhood?
On the recent celebration of International Workers’ Day, we present the results of an IDB study that shows how the place of residence matters when being selected for a job. We invite you to continue reading the rest of this blog to keep learning about this.
Discrimination: an invisible barrier in the cities of Latin America and the Caribbean
Most Latin Americans live in cities. Our urban municipalities concentrate most of the development opportunities. However, they also present enormous inequalities.
One in five inhabitants of cities in Latin America and the Caribbean (LAC) lives in a vulnerable neighborhood, Does living in a vulnerable neighborhood influence the options of finding a job?
Discrimination is an invisible but actual barrier. It not only prevents part of the population from accessing the same benefits and opportunities as those who are not discriminated against, but it also slows down the development of our region. Discrimination can take many shapes and forms and manifest in multiple places. Did you know that two people with the same experience and training may have different opportunities if one of them lives in a vulnerable neighborhood?
On the recent celebration of International Workers’ Day, we present the results of an IDB study that shows how the place of residence can influence when being selected for a job. We invite you to continue reading the rest of this blog to keep learning about this.
Discrimination: an invisible barrier in the cities of Latin America and the Caribbean
Most Latin Americans live in cities. Our urban municipalities concentrate most of the development opportunities. However, they also present enormous inequalities.
Each one in every five inhabitants of cities in Latin America and the Caribbean (LAC) lives in a vulnerable neighborhood (a slum, settlement, villa, camp, or favela, depending on the country). These neighborhoods have infrastructure deficiencies and precarious access to essential services and facilities such as water, sanitation, sewage, electricity, and road services. Generally, the inhabitants of these urban areas also lack formal property rights over the spaces they occupy, and their living conditions are very perilous.
These deficiencies represent significant barriers to accessing the opportunities offered by cities, such as access to jobs, health, education, and leisure options. But in addition to transaction costs to accessing public infrastructure, services, and property rights, an invisible barrier hinders the social progress of the populations in these neighborhoods.
The IDB works to understand discrimination in the urban environment
The Inter-American Development Bank (IDB) is committed to fostering the social progress of Latin American countries (LAC), which would be difficult to achieve without addressing discrimination. It is essential to know how discrimination is perpetuated in our cities. Addressing this issue, the Housing and Urban Development Division (HUD), first started carrying out a research agenda to measure the magnitude of discrimination faced by vulnerable groups residing in LAC metropolises. Then they partnered in this endeavor with the Department of Andean Group Countries (CAN).
They asked themselves the following question: is discrimination in the urban environment restraining slum dwellers’ access to the labor and real estate markets? These studies aim to measure, understand, and propose interventions to flatline discrimination in the urban sphere against vulnerable populations.
The latest IDB study on urban discrimination: invisible barriers in the labor market
As part of a research series, the IDB team implemented a study that seeks to answer whether the inhabitants of vulnerable neighborhoods are discriminated against in the labor market. Answering this question would show how social stigma towards people who live in deprived communities limits job opportunities. The methodology used was a field experiment, commonly known as a “correspondence studies” (these have been widely used to measure discrimination of other attributes such as race, gender, and even physical attractiveness in labor markets).
In a perfect world, when comparing two people with the same training and experience, both should have the same probability of receiving a job offer regardless of where they live. This study aims to disprove this claim. For this, researchers created pairs of “synthetic” (false) profiles of job applicants that were observationally equivalent in all their personal and professional attributes (same gender, same nationality, very similar age, very similar training, and very similar work experience). Their only observable difference was the neighborhood in which they lived. One lived in a slum and the other in a city neighborhood (of the same socioeconomic level). The details of the study methodology can be seen here.
They sent fictitious résumé application pairs to 4,290 real jobs advertised online between 2019 and 2020. Then, they recorded the callback rates from employers to individuals associated with the submitted résumés.
How can your neighborhood influence whether you are invited to a job interview?
The study results answered that question. It shows that job applicants who lived in slums received, on average, 28% fewer calls from employers than other applicants. This means that there is almost a 30% less chance of them being employed!
In addition, these rates were measured by subgroups of candidates based on their job qualifications and gender:
LEVEL OF STUDIES:
Job applicants with college degrees who lived in slums were found to receive 34% fewer callbacks than those living in the city.
GENDER:
Women living in slums were 26.6% less likely to be called back than women from the formal city, and men were 29.2% less likely to be called back than their counterparts. Discrimination is greater when the job offer requires a university degree. High-skilled men from slums were the most discriminated subgroup (registering 39.5 percent fewer callbacks than other male applicants). When the job offer required lower skills, discrimination was slightly less (12 percent fewer calls).
Download the publication “Discrimination in the labor market against slum dwellers”
This IDB study leaves several important lessons and questions to be answered in subsequent investigations. On the one hand, it showcases that it is possible to make visible and measure how significant the barrier of urban discrimination is. This task is essential for reasons beyond ethical considerations as it has economic meaning. Urban discrimination decreases the effectiveness of development programs since each dollar invested in improving the life of slum dwellers might not yield its full potential.
In addition, it has shown that discrimination is greater in occupations that require more training. The research shows that, regardless of their education, discrimination against slum dwellers will hinder the quantity and quality of investments in education they make. This makes it so that people who live in slums find it harder to escape poverty. From the public policy side, we hope that this study reinforces the need to include considerations regarding dealing with discrimination in the urban integration policy agenda.
The group is researching other forms of urban discrimination. Meanwhile, we invite you to download their publication, where you will find the source information presented in this blog.
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