3 Drastic Ways to Improve Diversity Hiring

May 2, 2018
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Merito Group is a woman owned recruitment company dedicated to hiring the best talent, whilst always being mindful of hiring a diverse number of candidates from all backgrounds. In today’s workplace, it is important to be mindful of the level of diversity in a company. Here, John Riccardi explains why.

I was on a Fortune 250 company’s website recently and clicked over to its careers page. A career talent-acquisition professional, I’m always curious to see what the company’s career page looks like and how it compares with the rest of the site. When it loaded, I was presented with multiple pictures depicting a “typical” workday at the company. The smiling faces in those pictures were as diverse as an ad for United Colors of Benetton.  The visuals were paired nicely with plenty of well-written copy about the various employee resource groups and other inclusion efforts. It all looked and felt very good.

Then I started to dig a little deeper (like any good candidate will!) and brought up the page with the senior leadership team. This page also had plenty of pictures, but this time it looked like the GOP congressional leadership!

Curiosity piqued, I decided to check out a few other companies and came to find that this dichotomy wasn’t unique. What an incredible message for your diverse candidates. Welcome to our organization — just don’t hit your head too hard on the glass ceiling!

In 2004, I took the AIRS Certified Diversity Recruiter course. Fourteen years later, diversity recruiting is still an issue and we continue to have the same conversations. We need to drastically change the way we hire diverse populations that goes beyond networking and branding.

Diversity is an issue that spans candidate attraction, selection, onboarding, inclusion, and more.  This article focuses on the selection process and proposes three key changes the talent acquisition team can make to positively impact diversity hiring.

Let’s start with some facts about diversity hiring:

Lack of Diversity is Costing Your Company Millions

It’s been well documented that a diverse workforce leads to a better bottom line for companies. In an article Why Diversity Matters, McKinsey reports that there is a linear relationship between racial and ethnic diversity and better financial performance: for every 10 percent increase in racial and ethnic diversity on the senior-executive team, earnings before interest and taxes rise 0.8 percent.

Using information from Datahub.io, the median EBITDA for the S&P 500 is $1,700,000,000. That means a small 10 percent increase in the diversity of the senior-executive team for an average S&P 500 company would drive $13,600,000 to the bottom line!

Diversity Unemployment is an Issue

Even with unemployment at historically low levels, diverse populations have significantly higher unemployment rates. Recently published BLS Data looking at the unemployment numbers for both males and females over the age of 25 reports that the national unemployment rate is 3.2 percent.

That same data shows that White and Asian people have significantly lower unemployment rates than the national average (see chart below). White people have an unemployment rate 12.5 percent better than the national unemployment rate of 3.2 percent, and Asians are more than 21 percent better!

Looking at the same demographics for Black and Latino people, we see that Blacks over the age of 25 have an unemployment rate that is a staggering 81 percent higher than the national unemployment rate, and Latinos have a rate that is 22 percent higher!

RaceTotalWhiteBlack or African AmericanAsianHispanic or Latino
Year20172017201720172017
25 Years & Older3.22.85.82.53.9

In addition to unemployment rates, statistics show that diversity, especially gender diversity, is an issue at the senior leadership level. A Fortune article in 2017 suggests that men accounted for 80 percent of all senior leadership roles in the Fortune 500. That same article quotes the Fortune 500 as having 32 female CEOs, but that number is expected to drop to 24 in April 2018. The numbers are quite similar for the S&P 500. where only 26 (5.2 percent) companies have female CEOs.

To read more of John Riccardi’s fascinating article from ERE Recruiting Intelligence on how to drastically improve your diversity hiring, please click here.

 


Merito Group is a small women-owned business providing excellence in outsourced talent acquisition solutions including retained executive search, RPO, and consulting services. Looking to hire exceptional talent? Contact us by email or 703-734-6340. To view our current career opportunities click here.

Copyright Merito Group LLC © 2021

Copyright Merito Group LLC © 2021