Criminal Justice Involvement, Self‐Employment, and Barriers in Recent Public Policy

This study provides the first empirical evidence on the extent of self-employment within the U.S. justice-involved population. Using linked tax return and Criminal Justice Administrative Records System data, we find that 28 percent of individuals with criminal records are self-employed. Justice-involved individuals are 22 percent more likely to rely solely on self-employment. The Paycheck Protection Program, passed to support small business during the COVID-19 pandemic, initially disqualified those with a broad range of criminal histories. We find that close to 3 percent of recent sole proprietors had observable PPP disqualifying events based on initial eligibility criteria, with a disparate impact on Black and Hispanic business owners.