Why should I change? Diversity, equity and inclusion (DEI) experts hear this question often. The fact is the world is changing… and quickly, so the answer is both simple – and complex.
There are many reasons why DEI awareness helps us be better people, but for now, let’s dig in to its effects on the workplace. The population of the United States is becoming increasingly diverse. According to US Census projections, Latin@s will make up over half of the country’s total population growth by 2020 and nearly 85% by 2060. African Americans are expected to reach 18% of the population growth by 2020, and Asian Americans, 15% within the next two years. What does population growth have to do with your business? It means the workplace – your potential hires AND your clientele – will be increasingly more diverse.
Think your current workplace isn’t diverse? Just wait. According to demographic predictions, the diversity landscape will continue to diversify. With change comes bumps and adjustments, but diverse work teams have been proven to be both more productive and more creative, in the long term. A study done by McKinsey further supports this by concluding that companies in the top 25% for gender diversity are 15% more likely to outperform companies in the lowest quartile. When it comes to ethnic diversity, that gap extends to 35%. Instead of staying stagnant, business leaders need to get in front of the curve, because to embrace diversity is to embrace productivity and innovation.
Let’s take a temperature check to understand the true diversity of both the workforce and customers in 2018.
Within the Workplace:
- By 2025, Millennials will compromise 75% of the workforce. Beyond the generational shift, this will bring diversity because while the baby boomer generation is 72% white, Millennials – a larger generation by over 10 million – are only 56% white.
- In 2012, people of color made up 36% of the labor force. This number has been presumed to have increased.
- Census data says that by 2050 there will be no racial or ethnic majority in the US.
- Women now make up nearly 60% of the workforce. Compared to 1950, where women represented just 29.6%.
- Gay and transgender workers make up 6.28% of the workforce today… However we must note that our understanding of this statistic is incomplete due to a lack of federal data for this sector.
While it’s exciting to see our workplace diversifying, there is still a lack of diversity at the top levels of leadership. For example, only 21% of Fortune 500 CEO’s are people of color – with only four women of color among them. Further, while women are an immense presence in the workforce generally, only 18 Fortune 500 CEO’s are women – a mere 3.6%. The public sector is no better when it comes to senior staff: A CAP report from Sept. 2011 projected that the racial/gender demographics of Senior Executive Service – federal government’s top managerial, supervisory / policy positions – will not reflect the workforce in 2030. So, as we talk about diversity increasing, we have to be mindful that there is still much work to do.
- Women will control 2/3rd of all consumer wealth in the US over the next decade.
- Women control more than 60% of all personal wealth in the US.
- The purchasing power of women in the US ranges from 5 trillion to 15 trillion annually.
- In 2016, US Latin@ buying power was larger than the gross domestic product of Mexico.
- African-American buying power, at 1.2 trillion in 2016, will grow to 1.5 by 2021 – becoming the largest racial minority consumer market.
- “The combined buying power of African Americans, Asians and Native Americans was estimated at $2.2 trillion in 2016, a 138% gain since 2000. The same time period saw the buying power of Asian-Americans grow by 222%, Native Americans by 164%, and African Americans by 98%.”
Next time you think about diversity efforts, remember these statistics. On a national and international scale, our globalized world is continuing to diversify. This may mean more intentional effort to shift workplace culture, but it also means higher productivity and more opportunities for innovation. Businesses reflect, react and adapt to the world around them. THAT is the intersection between business and diversity, equity and inclusion – DEI.
ECCO International has extensive experience in helping clients improve both speaking and listening skills, so we’re the best ones to help you identify opportunities for improvement. We improve employee and organizational effectiveness by developing multicultural competence for clients in national and global markets. We change the workplace environment on a long-term basis, which enhances the productivity of your organization. When workplace environment improves, productivity increases, thereby increasing profits!