As a career coach, I would be making a bit of an understatement if I said that I think often about the world of work. The future of work is a subject that fascinates me, and I spend much of my time thinking, learning and talking about it.
Whether it be discussing carefully with a client which growth industries best suit their talents, or researching for this column in order to bring the most up-to-date ideas on the ever changing landscape of work to my readers, the future of work is always front of mind. So much so, in fact, that I sometimes take for granted all of the recent changes that have impacted the world of work, workplace and industry cultures.
It goes without saying that the Covid-19 pandemic has brought tremendous change and upheaval to all of our work lives. But another major change of the last year has been the increasing push to prioritize Diversity, Equity and Inclusion (DEI) in the workplace.
DEI is certainly not a new concept in the business world. For many, the protests of summer 2020 shined a bright light on many of the racial and gendered inequities in our society, and highlighted the need to carefully consider how diversity, equity and inclusion are navigated in the world of work.
In response to this deeply charged and meaningful moment in our history, many companies and industry leaders felt pressure to make public their commitment to rectifying institutional bias within their own homes. Many issued statements and launched initiatives to combat discrimination and cultural bias.
Along with this social and institutional reckoning has certainly come a lot of progress when it comes to DEI, but many feel that there is much farther to go.
The conversation surrounding DEI certainly raises a lot of questions. So where do issues related to DEI stand today? How have companies made changes to address these issues? Where are we seeing progress and where are there still inequities to be addressed? What’s more, how has the pandemic set us back when it comes to DEI efforts?
This is a challenging subject, and I certainly wouldn’t put myself forward as the foremost authority on the issue, nor the person whose voice is most important in this conversation. However, I’m deeply passionate about the need for greater diversity and inclusion in the world of work, so I’ll do my best to address some of these questions.
How has DEI advanced in recent years?
While the challenges of the pandemic and the social upheaval of the summer 2020 protests really brought conversations about DEI to the forefront, in reality, these issues have been discussed in many sectors for quite a while.
Throughout the 2010s, dialogues around racial and gender equity, LGBTQI+ issues and media representation of underrepresented groups came to the forefront of cultural conversations around the world. As more Americans began to reckon with structural inequities throughout our society, businesses increasingly began to evaluate their cultures and practices with regard to these issues.
In 2015, McKinsey published an influential study entitled “Why diversity matters,”the findings of which show strong correlation between diversity and financial performance. Data from this study showed that companies with greater ethnic and racial diversity among staff performed 35% better than companies whose staff demographics matched the national average. Furthermore, companies with greater gender diversity performed 15% better than companies with less gender diversity.
In 2018, a follow-up study entitled “Delivering through Diversity” was published. The paper examined many companies’ approaches to diversity and inclusion, highlighting some of the reasons that these issues were increasingly relevant in business.
For some companies, the push for diversity was directly related to the desire for socially conscious practices aligned with company missions and values. For others, diversity was integral to their business models and plans for growth, or simply a question of complying with regulation.
The 2018 numbers showed that gender diversity was even more relevant in company performance, with gender-diverse companies performing 21% better than the national average. The study also found that ethnically and racially diverse companies had 43% higher profits. Nevertheless, the rate at which such companies outperformed the national average dropped slightly to 33%.
This paper also notably acknowledged the double bias faced by Black women in the workforce, a group which is statistically underrepresented in executive and line functions. Black women face an especially hard path to a CEO role, with 65% of Black female executives in a staff role, as opposed to line roles.
The higher one ascends in a company’s ladder, the more precipitously diversity drops off. Needless to say, many companies seem to have missed the memo about the link between diversity and company performance.
According to U.S. Census data on the 2020 working population, it’s at the support staff or operations level where racial demographics in the workplace most closely match U.S. demographics overall, although Latinx individuals make up just 10% of this tier of the workforce, compared to the 18.5% of the general population.
The percentage of white staff increases steadily at each level of the corporate ladder, finally representing 85% of executives. At the executive level the racial inequity is particularly significant: though13.4% of the total US population is Black, only 2% of executives are Black; 18.5% of the U.S. population is Latinx, but only 3% of executives are Latinx.
These numbers are striking, and illustrate the fact that inequality is deeply structural in the world of business and will take tremendous ongoing efforts to rectify.
The percentage of Asian American and Pacific Islander workers is more consistent across different rungs of the corporate ladder, and the disparity between corporate representation and AAPI demographics is less severe. AAPI individuals comprise roughly 6.8% of the population as of 2020, and have 8% participation at support staff level, 11% at the professional level and 8% at the executive level.
Many feel that these numbers don’t exactly tell the whole story of the wide range of Asian American and Pacific Islander experience within the U.S. workforce. A major issue here is a lack of data disaggregation in these statistics and studies; there is a widespread tendency for researchers to lump individuals from many different AAPI ethnicities into one demographic category.
One project that aims to address this issue is AAPI Data, which disaggregated data on AAPI individuals, creating more specific data sets and analyzing of smaller demographics within the larger AAPI community.
A data breakdown of poverty rates among different AAPI demographics in 2014 tells an important story of why it is important to disaggregate data related to these groups.
Grouped as one, AAPI poverty rates from 2014 were 12.3%. However, the number varied greatly when broken down into smaller demographics. The Filipino American poverty rate was 6.5%, and the rate for Japanese Americans was 8.5%. Other groups had a significantly higher poverty rate, with 14.5% of Vietnamese Americans below the poverty line and 16.7% of Native Hawaiians and Pacific Islanders falling below the poverty line.
This data also tells an interesting story that relates closely to DEI practices. We cannot attempt to rectify inequality within any system unless we are careful about the ways in which we approach data collection and think about demographic information.
Major cultural shifts in companies in 2020
Summer 2020 represented something of a cultural reckoning as millions took to the streets across America and around the globe to protest the killings of George Floyd, Breonna Taylor, Ahmaud Arbery, Tony McDade, Elijah McClain and countless other Black Americans.
These protests helped shed light on police brutality against Black Americans, for whom the number of civilian deaths at the hands of police is significantly higher than for any other demographic, with 35 of every 1 million Black Americans being killed. The conversation extended well beyond policing and led to many conversations about institutional racism and bias.
Along with these far-reaching conversations came increased pressure on companies to address bias and discrimination with their ranks and make public their plans to rectify such problems.
In a July 2020 survey, 49% of workers responded that their companies had directly addressed the news related to the death of George Floyd, whether through public statements, internal discussions or donations. The same survey noted that 76% of American workers believed that racism was a problem in American workplaces, with 64% of African Americans workers expressing the sentiment that racism was a problem within their own workplace.
The public response from corporations has ranged from seemingly heartfeld, to reductive and self-serving, a notable example being Nike’s rather goofy “Just Don’t Do It” campaign against racism.
In June 2020, in honor of Juneteenth, a holiday celebrating the liberation of enslaved Black Americans, worldwide conglomerate WPP announced that it would commit $30 million to fund inclusion efforts internally, as well as support external causes. Subsequently, in July, WPP shared its employee demographic information in an internal email along with the announcement of a formation of an inclusion council to fight internal discrimination.
In July 2020, Verizon announced its “Citizen Verizon” project with the aim of upskilling 500,000 workers, mostly from minority demographics, for jobs of the future by 2030. The same month, Old Navy launched the “We Are We” campaign featuring five young activists in a bid to project inclusivity.
A recent McKinsey study found that the entertainment industry alone is losing a potential $10 billion annually because of its issues with inclusivity and representation of the Black community. This September, the Academy of Motion Picture Arts and Sciences announced that it would be implementing a diversity quota system by 2024 for any film seeking eligibility for an Oscar, with the intention of increasing representation on screen and diversity in production.
In November, CBS followed suit and announced that its reality shows moving forward would feature at least 50% Black casts, following many years of criticism with how its flagship shows have dealt with issues of race.
These are just a few of the many corporate responses to the outcries for the examination of internal biases and prejudice. While all of these corporate initiatives represent a move in the right direction, some critics question the commitment to the ongoing work of DEI within the corporate space.
Starbucks is a good example of the seeming disconnect between public corporate values and internal practices. In 2018, Starbucks announced that it would close many of its stores for half a day to undergo racial bias training following a widely viewed instance of racial profiling.
In June 2020, Starbucks announced that it would donate $1 million to support racial-justice-oriented causes. However, shortly afterward the company came under fire for a leaked internal memo banning employees from wearing any merchandise supporting Black Lives Matter. Facing criticism, the company subsequently reversed the policy, going so far as to distribute Black Lives Matter T-shirt to their baristas.
To their credit, in January 2021 Starbucks announced that it would be launching the Starbucks Community Resiliency Fund with a $100 million endowment to support equity and inclusion in the communities it serves.
It would appear that the company is trying to do the right thing; however, their track record of making public statements instead of dealing internally with issues of racial bias illustrates a sentiment held by many that public-facing messaging around issues of bias and prejudice are often an optics game. Put simply, many feel that companies pass the equity buck when they worry about being “too political” or impacting profits or the bottom line.
Whether many of these corporate moves were motivated by genuine concern for creating greater equity is a challenging question to answer. While some corporate leaders were probably genuinely moved and forced to confront bias within themselves, for many it was likely motivated by the need to keep up with the times and get ahead of the issue with PR that reflected the growing sentiments being expressed widely through protests and social media.
While many companies proclaimed progressive values in regard to racial equity, many are less than forthcoming about the reality of demographics within their own ranks. As of July 2020, only 3.2% of companies within the Russell 1000 are transparent about the racial makeup of their staff.
Employees’ reactions and perceptions to increased DEI efforts
How have employees perceive this increased public focus on DEI and confront racial inequity within corporations?
Many employees feel that public-facing efforts to promote greater equity and inclusion have not necessarily matched internal corporate practices or culture, especially within certain industries.
A pertinent article in Wired magazine published this March spoke to the experience of employees of color within the tech sector, describing the actions of tech companies such as Google, Amazon, and Google, as “diversity theatre.” While the companies made headlines pledging financial support to racial justice causes and a commitment to rectify internal bias, employees continued to face ongoing discrimination in the workplace and pressure to be silent on issues of racial justice.
Indeed, despite major initiatives to address racial inequity within their ranks, many tech companies have failed to live up to promises of greater diversity. Between 2014 and 2020, Black and Latinx workers at Facebook rose by only 2% per group. In 2018, at the most recent count, Google listed only five Black female executives among their top 357 officers — that’s just 1.4%!
The Equal Employment Opportunity Coalition is currently investigating Facebook for racial bias in its hiring practices. And Facebook is not the only tech company under fire for its hiring practices. In April 2020, former Google recruiter Christina Curley revealed that she was fired over her efforts to extend more recruiting to candidates from historically Black colleges.
In many cases, it seems that corporate culture has not caught up with messaging coming out of the PR department. This is not only a shortcoming when it comes to creating a truly inclusive and equitable environment for all members of staff and candidates — it’s actually proven to be bad business.
To be competitive in recruiting, companies need to prioritize DEI. Data shows clearly that DEI is a priority for workers and job seekers, with 67% of people on the job market stating that racial and gender diversity is an important factor in their job search. Furthermore, 50% of current employees want their company to commit more energy toward promoting diversity.
Issues of diversity, equity and inclusion certainly don’t begin and end with corporate initiatives and workplace practices. It’s worth noting that while many efforts to implement DEI have been undertaken in the business world, the pandemic has represented a major setback for many within already marginalized groups. Job loss related to the pandemic has disproportionately affected Black and Latinx workers, with 11.5% of Black workers experiencing job loss and 12.3% of Latinxs, compared with 7.5% of white workers who lost their jobs.
The pandemic has also dealt a difficult blow to gender equality within the workplace. A 2021 study on gender equality in the workplace found that the Covid-19 pandemic set workplace equality back by several years, with the gender equality index projected to drop two points between 2019 and 2021 to levels below that of 2017.
Throughout the first 10 months of the pandemic, American women lost 5.4 million jobs, almost 1 million more than men. The gender discrepancy in job loss created by the pandemic has been so dire that some are describing it as the “first female recession.”
Next steps in DEI
An important takeaway here is that DEI efforts cannot be viewed as a Band-Aid for systemic problems. A trending marketing video or a one-off corporate training session will not go far to address biases, discriminatory practices and attitudes that are, in many cases, hardwired into corporations and industries.
To look at how to move forward with strong DEI practices, I’d like to share some thoughts from John Rice, a prominent DEI expert and founder of Management Leadership for Tomorrow, a nonprofit which focuses on rectifying systemic inequality and empowering the next generation of leaders.
In a very informative article on LinkedIn, he shared five important hallmarks of strong DEI policy. I’ll share a short summary of the primary 5 points he speaks about, but with the caveat that DEI strategy should always be facilitated by a trained professional and with a careful assessment of company culture.
The entire article is definitely certainly worth a read to dive deeper into what the future of proactive DEI policy could look like.
The work of promoting diversity, equity and inclusion must be ongoing and far-reaching, facilitated by experienced professionals and amplifying the voices of those from marginalized groups. Some progress has been made, at least on a public-facing level; however, in assessing the data and listening carefully to the perspective of individuals of diverse identities, it is clear that there is much more work to be done.