This paper is a collaboration between the Progressive Policy Institute (PPI) and the Association for Enterprise Opportunity (AEO)
By Anh Nguyen, AEO; Sidney Gavel, AEO; and Manu Delgado-Medrano, AEO
The United States has the highest incarceration rate in the world, and as many as a third of Americans have some type of criminal record. Upon reentry, individuals with a justice history, whom we refer to as returning citizens, face significant barriers to economic security and reintegration into their communities. Among the most formidable barriers to reentry are a disadvantaged living environment, low levels of education, mental health challenges, and stigma that excludes them from job opportunities and other resources.
All of these factors contribute to a high recidivism rate among returning citizens and make it harder for them to secure employment. An alternative yet underappreciated opportunity for returning citizens to circumvent these barriers is to work for themselves by launching their own businesses.
Entrepreneurship presents a promising pathway to economic security and reintegration into communities as it requires minimal formal schooling, provides additional income and control over their livelihoods, and has the potential to uplift the often-low-income communities to which these individuals return.
Additionally, a study in 2020 showed that entrepreneurship can reduce the likelihood of recidivism by 5.3%.3
While entrepreneurship has great potential to reduce recidivism and promote economic stability, returning citizens have to overcome several hurdles in their entrepreneurship endeavors, ranging from a lack of access to capital, collateral consequences of having a criminal record, a digital skills gap, and limited access to wraparound support services..
