By Michael Gee
Harvard Business Review, February 28, 2018 —
Forty years ago, two companies were known for aggressively recruiting minorities on college campuses: IBM and Xerox, both considered hot tech companies of that era. My senior year in college, a black sales rep from IBM encouraged me and a group of fellow black students to consider a career with the company. It offered a competitive salary and extensive training, and it could point to several minority leaders in management. When I joined the company, my branch sales manager — someone I considered a field office general — was black, as were many of my instructors. The job began my long career in the high-tech industry.
Decades later, I’ve seen very little progress in minority executive employment. It seems the national conversation and media focus on the subject have resulted in minimal impact. And yet the ecosystem supporting diversity is quite large — government agencies, formal corporate diversity programs, universities, consultants, and dozens of civil rights advocacy groups. So why has change been so slow?
For one thing, political rhetoric has created public tumult about the drivers of middle-class decline: globalization, technology, and immigration’s impact on U.S. jobs. Another recurring theme is an allegedly unlevel playing field for white males created by public- and private-sector diversity programs (affirmative action) to attract and promote a more diverse workforce. And the courts have weighed in on “reverse discrimination” cases, slowing the growth of diversity in some universities and companies.
As a longtime African-American executive who’s skeptical of reverse-discrimination claims, I wanted to find answers to a few questions: What exactly do black employment numbers look like today? How are blacks faring in promotions? Are blacks’ gains in executive and management ranks keeping pace with gains in the professional workforce?
Detailed analysis of employment numbers can help us understand racial and gender income inequality in America. A review of white-collar employment data from the U.S. Equal Employment Opportunity Commission reveals serious gaps in income, promotional opportunities, and advancement for minorities and women of all races.
An innovative model developed by the Ascend Foundation provides special insight. Using an EEOC database of employment data by race, gender, and job classification, it assesses management diversity with a ratio of minorities’ representation in management to their representation in non-managerial professional levels, a metric that Ascend calls executive parity index (EPI).
EPI helps us understand how well each race and gender is being promoted up the management pipeline and, in effect, whether the corporate ecosystem has been successful in creating a more diverse workforce. By taking into account the percentages of minority employees in both management and the professional workforce, an EPI analysis is a more insightful metric than simply the percentage of executives or employees who are minorities.
The Ascend Foundation’s analysis shows that white men (with an EPI of 1.81) are by far the most-represented group in management; executive parity is a ratio of 1.0. Following them are Hispanic men (1.07), white women (0.65), black men (0.63), Asian men (0.56), Hispanic women (0.49), black women (0.30), and Asian women (0.24). (The EPI numbers are bleak for many of these groups, clearly, but in this article I’m most concerned with black men and women.)
There are disturbing trends in economic mobility for African-Americans nationwide. White men continue to dominate executive and managerial roles at companies with more than 100 employees. Small businesses, those with fewer than 100 employees, are not included in the EEOC database.
A national review of 2015 data on white-collar employment shows:
- White men are 61.3% of executives nationally and 81% above parity when compared with their 33.8% representation in non-management professionals.
- In 1967 African-American median household income was 55% that of whites; in 2016 that number was 61%.
- Black men and women still represent a very low percentage of the professional white-collar workforce (less than 8%), given their overall representation in the population.
A Closer Look by City
We can also use the EEOC database to review how black men and women are faring in cities across the U.S., which can help identify leaders and laggards in diversity hiring. Notably, when it comes to black employment, high-tech regions Austin, Los Angeles, Boston, and the San Francisco Bay Area lag all other major cities.
Recent articles have highlighted the migration of African-Americans to “New South” cities, where job opportunities are perceived to be better. Home ownership rates and entrepreneurship (self-employment) may also be higher. Professional employment data suggests that more opportunities are still required at the local city level, however. (Atlanta and Washington, DC are among the leaders in percentage of black professionals.)
These low numbers aren’t entirely surprising. Corporate board commitment to and investment in diversity programs have been inconsistent. Decades of one-step-forward-two-steps-back government policies have also been ineffective. The EEOC’s policies, too, have not been enough to increase diversity. In his July 2015 testimony to the EEOC, Donald Tomaskovic-Devey, a sociology professor at UMass Amherst, commented “There is no evidence that corporate equal opportunity statements are associated with increased employee diversity.” In my opinion, EEOC oversight and enforcement of anti-discrimination laws nationally has also fallen short.
There are encouraging signs: There’s a growing number of states and cities that prohibit questions about salary history on job applications, as a potential solution to wage discrimination. Nationally, there are increasing numbers of minorities in the managerial pipeline, greater public awareness of income inequality, and the emergence of the #MeToo movement. Many people, especially Millennials, agree and believe that black lives matter. And more corporations are acknowledging that they need to do better on diversity.
To continue to improve, we need benchmarking of employer-reported public data to help identify corporate leaders in diversity. The Center for Employment Equity at UMass Amherst is one group that is making EEOC data easily accessible to the general public with the development of an online portal. Companies can (and should) examine their own industry performance and look for ways to improve. Further research on diversity data will help separate fact from fiction in this vitally important issue.
Because despite the expansive growth of the U.S. economy over the past 40 years, diversity hiring has not kept pace. Bottom line, if racial and gender minorities think they perceive limited advancement opportunities — the so-called “glass ceiling” — they are right.
Michael Gee is a graduate of Boston College and the Columbia Business School. He has extensive global business development and strategy experience.