Who cares about diversity, equity and inclusion?

Co-authored with Richard Johnson.

Diversity, equity and inclusion (DE&I) made its way to the forefront of the corporate agenda across the United States after 2020’s tumultuous summer. Two years later – amid deepening angst about the economic outlook – progress has stalled. We analyzed Glassdoor and survey data to understand the economic geography of the companies and demographics of the employees who care most about DE&I.

Corporate investment in DE&I surged in 2020 and 2021, but stalled in 2022.

Corporate investment in DE&I programs – for instance Employee Resource Groups (ERGs), initiatives to ensure diverse candidate pools for open roles, reporting of company diversity statistics, and analysis of pay gaps – surged in 2020, and continued to expand in 2021 according to company benefit reviews on Glassdoor. This progress appears to be stalling: 41 percent of benefit reviews through 2022-Q3 indicated access to a diversity program, compared to 43 percent in 2021. Still, this is a sharp increase from the 29 percent that reported access in 2019. (Outside the United States, access has also expanded in the United Kingdom and Canada, though in Canada access continued to increase into 2022.)

Since 2019, nearly every major industry has seen an increase in the share of benefit reviews indicating that their employer offers a diversity program – with access increasing most between 2019 and 2022 in the Personal Consumer Services, Insurance, Media & Communication, and Pharmaceutical & Biotechnology sectors.

There was one exception to the trend: Government & Public Administration. In 2019, Government & Public Administration was the leader across industries for access to DE&I programs; by 2022, it was solidly middle of the pack. It was the only sector where access to DE&I programs declined from 2019 to 2022.

ERGs in particular have seen a boom over the past few years. References to ERGs in company reviews on Glassdoor are up more than six-fold since 2019, while references to diversity awareness training programs are up by 40 percent. References to generic/non-specific diversity programs are up nearly three-fold.

Companies in the Northeast and on the West Coast are more likely to offer Diversity Programs, but access has expanded across the United States.

Access to Diversity Programs expanded sharply across the United States between 2019 and 2021. In 2022, they have largely stagnated; in some areas, they have begun to decline. (1)

The chart below shows the share of companies where employees indicate that they have access to a Diversity Program in Glassdoor benefit reviews, by Census Division. (2) (Census Divisions are major geographic areas of the country created by the U.S. Census Bureau.)

Among the top 25 metro areas (by the size of their labor force), Diversity Programs were most widespread in 2022 in metros that skew toward highly educated, professional workforces:

Most large metro areas saw an increase in the share of companies providing access to a Diversity Program between 2019 and 2022, though three metros saw the share decline.

A supermajority of employee reviewers view Diversity Programs as a “pro”, but a small, stable minority view them as a “con.”

An overwhelming majority of employee reviewers on Glassdoor – between 61 percent and 72 percent over the past six years – view their company’s Diversity Program as a positive benefit (i.e., they list it as a “pro” of working at the company). A small, stable minority – between 15 percent and 21 percent – list it as a “con”.

Since 2019, the share of reviewers who list their company’s Diversity Program as a “pro” has increased slightly from 68 percent to 72 percent, a shift that mostly appears to be driven by a parallel decline in the share who view the benefit as “neutral”. In other words, modest gains in the share of employee reviewers who view Diversity Programs as a positive benefit has been due to more positive views among those who were previously ambivalent about these programs.

DE&I matters for the majority of employees and job seekers across age groups, but it matters more for younger employees, women, and people of color.

At the individual level, the employees who say they care most about DE&I tend to skew younger, non-white (especially Black), and female, according to a Glassdoor analysis of a September 2022 survey commissioned by Glassdoor and conducted by The Harris Poll among nearly 2,700 U.S. workers and/or job seekers.

Among employees and job seekers aged 18-34, 80 percent say that a company’s investment in diversity, equity and inclusion is very or somewhat important to them when they are considering a new job, a statistically significant difference from employees and job seekers age 55-64 (67 percent), and from employees and job seekers age 65-plus (61 percent). It is also statistically larger than the 74 percent of employees and job seekers aged 35-54 who say it is very or somewhat important to them.

Broken out by gender, women are more likely than men to say it is important. By race/ethnicity, Black, Hispanic, and Asian American/Pacific Islander (AAPI) employees and job seekers are more likely than white employees and job seekers to say it is very or somewhat important to them.

Simply comparing differences across age groups might be misleading since younger employees are also more racially/ethnically diverse than older employees, and that might explain the difference across age groups. Indeed, looking at the gender gap by generation, we find that the gaps are largest for older workers and smallest for younger workers.

Disaggregating the results by generation and race/ethnicity, shows somewhat diverging trends between Black employees, and white and Hispanic employees.

Conclusion

Moving into the post-pandemic era, we’re seeing that corporate leadership is less and less about top-down decisions and more about stakeholder buy-in. Today’s business executives must navigate an increasingly tenuous trinity of stakeholders: Investors, Customers, and Employees. The order of priority varies with economic conditions and by corporate structure. Employee concerns naturally rise higher on the agenda during tight labor markets as we have had for much of the past two years.

With worker resignations falling and hiring conditions easing, DE&I initiatives have come under scrutiny from some investors and advocates who view them as a distraction from a narrower set of business performance metrics. Proponents of these programs tend to counter that (1) a diverse workforce is something that employees – particularly future employees – value, and/or (2) a diverse workforce leads to more robust business outcomes.

Empirically assessing (2) is beyond the scope of this analysis. (Our reading of the existing literature – for instance here, here, here and here – is that it does.) However, the data presented above support the notion that DE&I is important to younger workers who will compose a larger and larger segment of the U.S. workforce in the years ahead, that these programs are increasingly widespread across the United States despite continued gaps, and overwhelming shares of employees view these initiatives in a positive light.

Methodology

To assess corporate investment in DE&I programs nationally, we analyzed Glassdoor benefit reviews and took the median share of users across all industries indicating access to an employer-sponsored diversity program from January 2017 through September 2022. For the industry and geospatial analysis, we conducted the analysis at the employer-geography level, taking the share of companies within a Census Division or metro area where any employees indicated that they had access to an employer-sponsored diversity program. We excluded firms where there was only one benefit review in a given Census Division.

To capture employee-sentiment towards diversity programs over the same period, we analyzed employee reviews and group mentions of diversity program related terms and phrases such as, “DE&I Program”, “bias training”, “anti-racist training” and “employee resource groups” as positive if it appears in the “pros” section of a review and negative if it appears in the “cons” section. Reviews where one of these terms and phrases was mentioned, but was not categorized as a positive or negative characteristic of working at a company, were categorized as neutral.

To assess the importance of corporate investment in DE&I to employees and job seekers when considering a new role, a survey commissioned by Glassdoor and conducted by The Harris Poll was conducted online within the United States from August 30 - September 1 and September 6 - 8, 2022, among 4,049 adults ages 18+, of whom 2,688 were either currently employed or not employed but actively seeking work. The sampling precision of Harris online polls is measured by using a Bayesian credible interval. For this study, the sample data is accurate to within +/- 2.8 percentage points using a 95% confidence level.

Footnotes

(1) 2022 data covers the first three quarters of the year only.

(2) New England: Connecticut, Rhode Island, Maine, Massachusetts, New Hampshire, and Vermont. Middle Atlantic: New Jersey, New York, and Pennsylvania. Pacific: Alaska, California, Hawaii, Oregon, and Washington. East South Central: Alabama, Kentucky, Mississippi, and Tennessee. Mountain: Arizona, Colorado, Idaho, Montana, New Mexico, Nevada, Utah, and Wyoming. West South Central: Arkansas, Louisiana, Oklahoma, and Texas.

(3) Baby Boomers include respondents born between 1945 and 1964, Generation X includes those born between 1965 and 1980, Millennials include those born between 1981 and 1996, and Generation Z includes those born in 1997 or later.