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Changing demographics demand that businesses address workplace diversity
Question:
I continue to receive a lot of mailings on the topic of workforce diversity. Why am I receiving all of this mail? Where are we with this topic? I have a hard time sorting through what’s relevant and what isn’t. Is this still a legitimate topic to spend resources on or has it become just another cliché, just another management fad?
Answer:
Like you, I receive a lot of literature on the topic of workforce diversity. Perhaps that is because it is almost impossible to avoid running into it. Along with new-employee orientation and sexual harassment, workforce diversity was among the three most popular training topics of the 1990s.
Why was that so? What is it about workforce diversity that made it (and makes it) such a compelling topic? For starters, it is an emotionally compelling topic with which many of us can resonate. That is certainly the case for larger organizations that are competing on a global scale. The topic of workforce diversity can be a divisive one, however. In exploring the topic, we can get caught up in differences rather than commonalities. One leading author in this area, R. R. Thomas, has noted that potential divisiveness and posited that the most inclusive definition of diversity is “any mixture of items characterized by differences and similarities.”
With that definition in mind, let’s explore some of the reasons why workforce diversity is still relevant to today’s organizational setting. At the outset, we must be mindful of the global economy in which we operate. This evolving dynamic means that the rules of doing business are changing. And there are several important trends shaping that evolution. First, across the world, women are entering the workforce in greater numbers, especially in developing countries. That means that the concerns of women, such as greater day-care and parental leave options, are accelerating.
Second, the average age of individuals in the workforce continues to rise, especially in the developed countries. That means that younger employees have more employment options available to them than ever before.
Third, the global workforce is becoming increasingly better educated. And while the developed nations continue to turn out a high percentage of the world’s college graduates, given the population shift that is occurring, there is also a shift occurring in the area of human capital. Put simply, more and more developing nations are turning out high school and college graduates.
Closer to home, here in the United States, there are a number of important trends that continue to make the topic of workforce diversity a relevant concern. Perhaps the most alarming of those is that while women constitute a larger and larger segment of our workforce (women account for nearly half of those employed), they still lag behind in compensation. Specifically, women earn only about 72 cents for every dollar earned by men. By any standard, that is unacceptable.
Beyond that troubling statistic, the following five demographic features are shaping the 21st century workforce:
· The population is growing more slowly. The birth rate has slowed in this country to the lowest level of increase in the last three decades. That means that our workforce will be an aging one, and that there will be fewer employees to replace those that are retiring.
· The population and workforce will grow older and a shrinking pool of young persons will enter the workforce. The large age cohort of the baby boomers (those born between 1946-1964) is beginning to approach retirement age. The Generation Xers (born between 1965-1981) are fewer in number. That is one of the reasons why we have heard so much about revising the Social Security system; in the future, there will be fewer workers for every retiree who is supported by the system.
· More women will enter the workforce. It is estimated that about two-thirds of the new entrants to the workforce are women. The percentage of women with children below the age of six who work has grown four-fold since 1960. And, as previously noted, women are not necessarily compensated comparably for comparable work. They also tend to be concentrated in lower-paying jobs.
· The new entrants to the workforce will be Americans of African, Latino, or Native American descent. Minority employees constitute a larger and larger share of the workforce. That trend will continue.
· Immigrants will constitute the largest share of the increase in the population and workforce since the beginning of the 20th century. Approximately 600,000 immigrants enter the US every year, and about two-thirds of those who are of working age enter the workforce. Thus, especially among the 16-24 age group, the composition of the workforce will be very different from what we have seen in the last several decades.
I think I’ve made a strong case for the relevance of workforce diversity to a 21st century business. Let me conclude by observing that, from my vantage point, there are two overriding diversity challenges that warrant ongoing attention. First, we must do a much better job as organizations of matching worker characteristics with job challenges. Many of you will recall my column from the May 25 issue of Small Business Times in which I explore the concept of job design. To capture the potential of every employee, it is imperative that we do a better job of pursuing the concept of person-job “fit.”
Second, the organizational concepts of fairness and equality must be vigorously pursued and enforced. Never mind that a variety of affirmative action edicts demand it; the notion of treating all employees fairly must simply become the way we do business. To do otherwise is to run the risk of limiting ourselves, of becoming one-dimensional in our demographics, our thinking, our creativity, etc. Today, competitive advantage means tapping into all of our employees and seeing them as viable resources. To value only those employees whose backgrounds are like ours is to literally play with one hand tied behind our backs.
So, is workforce diversity a highly visible topic? Absolutely. Has this visibility (or overexposure) led some to question its relevance and/or importance? Absolutely. Do I share that dismissive mindset? Absolutely not. And after reading some of the statistics I cite in this article, I would hope you would feel the same way.
Daniel Schroeder, Ph.D., of Organization Development Consultants, Inc., in Brookfield provides HR Connection. Small Business Times readers who would like to see a topic addressed in a column may reach him at 262-827-1901, via fax at 262- 827-8383, or via e-mail at schroeder@odcons.com.
July 20, 2001 Small Business Times, Milwaukee