Mallory Madeleine, 23, was thrilled when she got into a prestigious law school in Charlottesville. All she needed to figure out was where she’d live. Housing that was affordable to graduate students had long waiting lists so she was relieved when she found a landlord who was willing to lease to her. But her landlord was livid when she mentioned the word ‘partner.’
He made clear that he despised the word and had second thoughts about renting to her.
Though Madeleine was upset by his blatant homophobia, she was desperate for secure housing. She apologized for offending him and said she agreed with him. The housing finally worked out, but homophobia in Virginia is more than one man and one house.
“There’s no statewide law to protect people from discrimination on the basis of their real or perceived sexual orientation or gender identity and expression in the private or public workplace,” she said.
Virginia is not the only state this happens. North Carolina’s lawmakers recently introduced HB2 that forbids transgender people from using restrooms according to their changed gender identity. Though the rhetoric about this piece of legislation focuses on bathrooms, it’s broader- it prohibits a whole set of laws that protect members of the larger LGBTQ community against discrimination.
Eighteen more states in the U.S. have no statewide non-discrimination laws that protects LGBTQ people from discrimination at the workplace, while looking for housing or in publically accessible places.
But discriminating against the LGBTQ community hurts more than just individuals and their families. It also impacts companies, the government and the economy.
TransLifeline, a national suicide hotline for the transgender community, has noted that its call volume has doubled after North Carolina’s HB2.
“We’re facing hostility on an unprecedented level and it takes a psychological toll on us,” said Andre Perez, a transgender man who works for TransLifeline. “People in power are talking about how you’re a sexual threat and that’s made people in the closet afraid to come out- and those who are out are going back.”
Perez claimed that the hotline’s lead operator who lives in North Carolina publically protested against HB2 with his wife. When his wife came into work the next day she was immediately laid off without an explanation; she was a schoolteacher and had little protection from the law. Even though the operator- who is also transgender- was the one discriminated against, his wife had to pay the price of his advocacy leaving him to be the sole breadwinner of their family.
This discrimination adds up and costs the government several millions. A 2013 study published by the Williams Institute at UCLA showed that employment discrimination against transgender people costs the State of New York more than $1 million in Medicaid costs annually. The study used findings from the National Transgender Discrimination Survey (NTDS) to measure discrimination and then applied it to census findings and safety net costs.
It also estimated housing discrimination costs between $475,000 and $5 million yearly in housing programs- both federal and state- as well as other costs pertaining to homelessness. The study also predicted millions of dollars in income tax revenue loss were if transgender people faced reduced or no employment discrimination.
Transgender people face higher rates of discrimination than lesbian, gay and bi-sexual people, so while it is harder to generalize hard numbers to the larger LGBTQ population, it is still evident that the price of discrimination is hefty.
North Carolina is set to lose approximately $4.7 billion annually for violating the Title IX of the Education Amendments of 1972. It could also lose federal contracts worth $65 million annually as well as up to $5.6 million in federal grants. The state is set to lose a lot more through a drop in tourism and the withdrawal of companies and conventions. Yet this only estimates the short-term costs and not the costs of the effect of deep-rooted discrimination.
“Discrimination makes people less productive, it holds them back from getting a better education, it might harm their health, it might make it harder for them to work with other people. This raises costs for firms that discriminate or operate in states that do,” said M.V. Lee Badgett, the director of the Center for Public Policy and Administration at the University of Massachusetts Amherst.
Badgett has spent decades studying the impact of LGBTQ discrimination. Her study about homophobia in India, in conjunction with the World Bank, showed that homophobia can be linked with lower productivity, low returns on investments in education, lost output and exorbitant expenditure on services that combat the effects of discrimination that could be spent better elsewhere. The study lacks data to make a monetary estimate but cites a parallel study that shows that reducing gender inequality would add to India’s GDP by 4.4%
The common notion is that if discrimination is inefficient, the market should be able to eliminate it through competition. But in reality there isn’t enough competition for it to have an effect on the companies. Companies that have discriminatory hiring practices lose little in the short term because other companies in that industry have relatively similar candidate preferences. But candidates who are discriminated against often settle for jobs with lower wages or remain unemployed for a long time, widening the gap between them and the jobs they want to be hired for. This seems to just hurt the LGBTQ community initially, but losses add up to evenutally have an impact on the economy.
Another caveat is that people are not open about being discriminatory or are not aware of the biases they have internalized which makes it difficult to put a solid dollar figure on the cost of discrimination. Research has tackled this by focusing on the benefits of integration rather than the costs of discrimination.
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A 2010 research study published by Bryn Mawyr College investigated labor market discrimination through Major League Baseball’s delayed racial integration. Baseball data is easier to measure through hard figures- scores, player stats, ticket prices. The data was from the 1950s where people were more upfront about their biases. The study showed that coworker performances improved with integration and ticket prices didn’t drop. Teams also reportedly lost profits up over $19 million ($2.2 million in the 1950s) by delaying integration.
Jon Lanning who conducted this research said that the qualitative findings could be generalized to other industries where it’s not only difficult to identify bias in a fiscal sense but difficult to show that the fiscal loss comes from biases.
Another report published by the Williams Institute compared studies that showed that LGBT-supportive policies impacted the business positively with those that said that such policies had no impact or a negative impact on the business.
“Employees who are covered by policies are more satisfied with their jobs, are more committed to their employees, which could have a positive impact on the bottom line of the employer,” said Christy Mallory who was a part of the team who compiled the report.
M.V. Lee Badgett takes this a step further to suggest that employers are increasingly aware of the benefits of being inclusive.
“The trend in the U.S. on a national level is more towards inclusive policies for LGBT people. Employers have more options and may stir their investments away from states that are actively exclusive inclusive people,” she said.
But Trans Lifeline’s Andre Perez couldn’t disagree more. He said that the psychological fear- the fear of losing jobs and the fear of violence- has lead to increased levels of stress, the impact of which has been understated even as 41% of transgender people attempted suicide.
“Yes, trans people were a lot more visible, but that has inspired more of a backlash. It is a simplistic idea that all changes happen in one go. When we take two steps forward, we often take one step back,” he said.