More brands and businesses are becoming vocal in the movement for racial justice and equity. Some are taking it a step further, pledging donations and changes in their own practices to address workforce and equity. Adidas, which also owns Reebok, is pledging to increase the number of black and Latino employees it hires by the end of next year.
Bank of America is pledging to address racial and economic inequalities by partnering with community colleges and universities.
Microsoft CEO Satiandadella has now outlined some plans to double the number of black managers and senior leaders in the US of that company over the next five years.
In twenty twenty, after the murder of George Floyd in Minneapolis led to protests across America, many US corporations pledged to address racial imbalances in their workplaces. They promised to hire and to promote more black people and others from underrepresented groups. Now three years later, we're able to see some of the early results. Bloomberg's Jeff green and Rebecca Greenfield are here to talk about a new analysis by a big team here in our newsroom. It shows for
the first time. How some of the most prominent US companies did in making good on those promises. Where they've made gains.
Across eighty eight companies, ninety four percent of those net new people were people of color.
It's the kind of number when you see it, you go back and you check all your data because you figure you must have done something wrong. And we've done that again and again, and it's correct.
And where they still fall short.
More than a quarter of companies and our data set had fewer black executives and twenty twenty one than twenty twenties.
And the question we're talking about right now is did it continue.
I'm west Ksova today on the big take workplace inequality by the numbers. Jeff, you've been following these numbers for three years, now, what got you started on this project?
We're trying to find a way to measure diversity, and as Becca knows, it's really frustrating the lack of data that's available that you can compare apples to apples. It just doesn't exist except in this one database, which happens to be secret and protected by the Supreme Court, so you can't force companies to show it to you.
And what is this database?
Every year, the US Equal Employment Opportunity Commission requires companies with more than one hundred workers to report the race and gender for nine positions executive down to like service worker. So basically every role, by every way you could think of slicing and dicing it in the company. That information is totally private unless the company volunteers to disclose it.
What does the government do with this information?
They aggregate it. They make a huge database of the whole country, so you can track what's happening by like city and region, non mislead and they also can specifically use it to find really bad violators of like if if your numbers are really wacky, they're going to come and they're going to ask questions.
So when you went off trying to figure out, well, how diverse is the American workforce at these big companies, what did you have to do?
Well, we were aware of the data because Facebook and Google, the tech companies, were under scrutiny.
Black professionals make up just five percent of the tech workforce and three percent of executive positions. From twenty fourteen to twenty twenty, black representation increased by only one percentage point.
And the banks were under pressure from the New York City Controller to show they were hiring more fairly, especially for women, and so they were convinced to release this data to get these people off their back. So we knew they existed. When we started this project, there were about a dozen companies that had in some way released this data to the public, so we knew it was possible.
And Jeff, what made you want to try to get this information for his many companies as you could?
It was really the frustration of trying to figure out what was really happening, because every company would report this data in a different way, based on what made them look good or how they felt comfortable. Some would give just people of color, some would break it out by different races, some would put all underrepresented groups together. And it made it next to impossible to put two companies
next to each other and see how they're doing. So this was the only way I could think of, you know, apples to apples comparison, And there's a a federal law that requires you to do this, and it says exactly how to do it, and each company has to do it the same way. So it is the only set of data that I'm aware of at a federal level that we could go to. So I just I just kept making that case, and the companies just kept telling me I was nuts and it's unreasonable.
Reporters like Jeff and I had been aware of this data for a little while because companies were under pressure to do better specifically with gender, specifically tech companies and banks. But then there was a turning point, which was the summer of twenty twenty when George Flood was murdered and there were huge protests and a lot of big companies basically said we are going to do better, and we're going to hire and promote more black people specifically, but
then broadly more people of color in general. We know that most workplaces are lopsided, that at the top are mostly white men, and disproportionately so like, of course, you know, white people are our larger share of the population, but they still hold even more power and have more money
than other groups within the country. So that was when we decided to say, okay, we want to look at this, and that's when we systematically decided to ask the S and P one hundred, will you give us these EO one forms.
I would say that the murder of George Floyd definitely broke this open as like a plausible request. Companies were not so much suddenly happy to comply, but they were reluctant to be on a list of companies that didn't comply. Being singled out is not cooperating in racial equity was a bad look.
So you went to all these companies, you asked for the data. You went back and forth, and then you got the numbers. Which companies gave you data of the S and P one hundred, there were one hundred largest companies.
The first time we did it, it was twenty five. The next time we did it was thirty seven, the time after that it was somewhere in the seventies, and now it's ninety six. Every time we went there were more companies who were willing to comply, and we weren't the only ones asking, but it became a very common question, if you're serious, where's your EEO one?
And at first companies were trying to give us numbers in different forms, you know, to make themselves look a little better, or you know, they thought it was unfair because the forum is very specific and doesn't work perfectly for every company. Not every company has crafts workers, for example. But over time, you know, we held farm and said, no, we need the EEO one forum. That's the only way to compare companies to each other. And now it's much
quicker to get that form. They're pretty familiar with. That's what we want, that's what matters. Just give it to us.
And so what years do these data cover.
It's twenty twenty to twenty twenty one. Unfortunately, because of COVID everything was slowed down. They haven't even submitted their twenty twenty two data, so we don't know what that looks like. They don't have to have that turned in until December. So this is the most current data available for these large companies.
And so essentially you have the numbers for right after a lot of these companies made this big pledge, right at the time when there was the most scrutiny on them. And why don't we start talking about the numbers themselves? What did you find in all this trove of data?
Jeff and some other really amazing reporters at Bloomberg decided to look at where did things change on the margins, because that's really where you're going to see changes Basically, all companies can really do is hire people, promote people, people retire, and people are laid off. So they looked at these net worker changes. So that's gains and losses
across eighty eight companies. Ninety four percent of those net new people were people of color, which is really astounding, Like that is a big change.
So Jeff, let's break that down a little bit. When you say ninety four percent of net new employees, what does that mean.
So there's about nine million employees working at these companies. They added about three hundred thousand new workers over the time period we studied, and of those only about twenty thousand were white. It's the kind of number when you see it, you go back and you check all your data because you figure you must have done something wrong. And we've done that again and again and it's correct.
And I also want to say that we break it out by different racial and ethnic groups, Asian, Hispanic, and black. You know, they grew more than their share of the population. So it's a disproportionate gain, is what we call that.
And so that top line numberley's something that these companies would want to boast about. But then you dug more deeply into the data and started to divide it up, and there the picture becomes a little bit more complicated. Can you describe what that looks like, Jeff.
What we found was that in the power positions like executives and managers and professionals, there were fewer gains for the underrepresented workers than in the broader sort of less skilled, lower paying jobs. But still across the board they did better. It's just as you would expect. It seems to be harder for the companies to put people of color into the power jobs than it is for them to get them in the door, but at least across the board they seem to show gains.
Also when you dig into specific companies. Of course, not every company did everything across the board, but there were some really big companies that did do interesting and notable things. So one company that we single out is Amazon, which is a big company with a lot of employees. It made a lot of hires in twenty twenty one. Of course, a lot of the gains among black and Hispanic workers. Specifically, we're at the lowest level, so you know that's where
house jobs. But when you dig deeper, they also hired a lot of people at the higher levels too. Another company that stood out to us was Nike, and Nike's much smaller company, but tends to have pretty high paying them all paying jobs and pretty much for every single racial and ethnic group, especially at the high paying level. So that's executive manager, professional. Every race and ethnicity saw some gains. So those are interesting.
Trends, Jeff, you also talked about some other companies. What are some of the ones where it stood out to you in the numbers.
CBS was interesting. They brought in a lot more people for some of the similar reasons. I mean, this is COVID, so you're seeing a lot of a COVID effect here. But even interesting, home depot and lows shrink during this time period, but their diversity improved. This is a big question that we have is what happens when you lay people off? Does diversity so in companies like that prove the point. We could see it right there in the data.
They cut workers, but somehow they managed to maintain their diversity and improve it slightly, which is a really relevant question right now.
And does that suggest that even though they knew they needed to cut, they were very specifically trying to maintain diversity even though they had to shrink their overall numbers.
That is the premise. We've talked to some people not in the s and p. One hundred about how they shrank, and everyone that we talked to said, we've already recognized that last in, first out. The idea that you fire the newest workers in a downturn is the way to go. It just doesn't work. So that gets rid of all your diversity. Because your newest workers tend to be your most diverse. It does appear that that's what was happening.
I mean, the problem is we don't know because no one will talk to us about what their numbers actually say.
After the break why some companies are hesitant to point out the progress they've made. Zecha, We've been talking about some of the success stories, but you also found that some companies moved in the other direction.
Yeah, so, I mean progress is uneven when you dig into specific companies, not everyone is going to look the same. More than a quarter of companies and our data set had fewer black executives and twenty twenty one than twenty twenty, So that's the opposite of what you want to see. And there were just a smattering of companies that moved in the opposite direction, so they lost the share of people from underrepresented groups.
Yeah, and the key thing here is, even where we saw a shared decline, we're talking points of percentage points, we really didn't see anybody who went like in a serious opposite direction. What this mostly does is show like areas where companies are deficient, like not having any black executives. Directionally, the momentum was clearly in the favor of people of color in this year.
And bego, what are the companies that didn't increase the number of underrepresented employees say about.
That outside Generally, companies that had what you might consider good or bad or you know whatever their EO one forum looked like didn't really want to talk specifics with us. They didn't want to get into how they did it. A lot of companies sent we are coming into diversity language, or they would, you know, send like here, you know, here's what we've said in the past about it, but really known was going to dig in deep with us
on what they did, which really surprised us. Actually, you'd think that, you know, especially the ones who made big gains, would want to get into it and say here's how we did it, but they didn't want to. One reason we think that is is because it very quickly has become very unpopular to talk about diversity in the current cultural conversation.
So corporate diversity, equity, and inclusion programs are coming under fire now as conservative groups are pushing against the workplace policies.
Legal threats against companies promoting these initiatives have only ramped up since the Supreme Court ruling that determined if from action was unconstitutional.
Things have really changed since twenty twenty. You know, there was at that time a big push people thought it was important. Now it's not that way. There's a big anti ESG pushbacks that ESG as companies deciding that they care about social and environmental issues in the way they run their companies. A lot of people are saying that's not important, corporate anti woke backlash. Basically a lot of people saying, why are we focusing on these things? Companies
should only be thinking about their bottom line. US Supreme Court reversed affirmative action and education, which some people think could be applied to companies. They're very worried about legal risk for that, so they have more reasons not to talk about it now than they do too talk about it.
I think if this data came out in twenty twenty one, they'd be dancing in the streets and companies would be lining up to talk to us. But in twenty twenty three it could be a lawsuit. So they're being more cautious. They're being advised by their lawyers to just be careful what you say and how you portray it, and that really is kind of unfortunate, considering this is pretty much shows what they can do when they're pressed.
And what is it that they're afraid of being sued for.
I mean the fact that a disproportionate number of the people they hired were people of color. The groups that are suing over this would say, hey, this shows very clear bias in your hiring and therefore we should be able to sue you on behalf of white workers who didn't get their share of the jobs that were available.
I also think we need to clarify that when they're the worker losses were, yes, disproportionately white people, but we don't know what that is. That can be yes, layoffs, it can be firings, it can be retirements. The demographics of the US are shifting that many more people coming into the workforce aren't white. So this is going to happen naturally, but it's not necessarily discriminatory. There are lots of reasons why the losses might look one way or another.
Or you know, a company closing down a warehouse in a disproportionately white part of the country for what you know, maybe the population is shrinking and they don't want a warehouse there and opening it up in a more diverse part of the country. So there's a lot of reasons these changes are happening. I think we do need to make that clear. It's not necessarily straight up discrimination.
That's the really important point, because the workforce at the moment is kind of split, where white workers are older and retiring and the black and Hispanic workers are the youngest workers and entering the workforce. So if you want to leave the workforce and you're white, you can probably afford it. But for people of color, they're just getting started and thus less able to leave the workforce. When there were bios and such as well, there are a
lot of dynamics in play that could explain this. It's just we wish the companies would give us some sense of what they think is causing.
It beca One of the things you write is that for a lot of years, companies said they have a hard time finding qualified minority applicants because there isn't a pipeline. And yet this shows suddenly that pipeline appears when they have to do it.
Yeah, I mean, pipeline is something that people like me and Jeff have been in this world for a long time. Was a big buzzword.
And what exactly is a pipeline? Because you hear that all the time, But what do they mean by that?
Well, we don't have enough people with X degree that will lead them to this hire and paying job, whether that's you know, a tech job or management position or CEO position. We just don't have the people with the skills and the talent we need to fill the job. So it's not our fault. Actually, it's the structural problem, which we you know, can do things to change, but it's so long term you'll never see it. And I think a lot of people have said that's not true. One,
there's more creative ways to hire and train people. There's been a push away from requiring college degrees for every single job. That might not need them. But also there are reasons that people along the way of their career leave. And I reported on gender in the workplace for a very long time and that was a big one for women specifically, there were a lot of them in entry level jobs. Why are they not climbing up this ladder to mix our metaphors, you know, they're discriminated against. The
workplace isn't very open and welcoming to them. They have children and find it very difficult to stay in. So you know, that's just the gender component, but there are similar reasons for people who are underrepresented. They don't feel welcome, it's very difficult, or you know, there's certain in group skills that lead to your success. So I think it's a much more complicated picture, and it shows when you
kind of get rid of some of these excuses. You can not only build out your pipeline, as Jeff said, but yet it's the higher paying levels. Do you have more people in these jobs?
Also in this timeframe, suddenly work from home was possible, and if you can hire people wherever they are, you can hire from a much more diverse, you know, pipeline of people. Then you can hire when they have to live in the city where you're based. In the middle of America might not have a diverse workforce, but if they can suddenly hire from Georgia and Texas, it works great.
When we come back, Will companies keep up their diversity efforts, Jeff, As you said, these numbers stop at twenty twenty one, and a lot has happened since then. I guess one of the big question marks is has this flurry of new hiring continued or was it a one time thing and it's tapered off and people are just going back to their old habits.
We don't know for sure, but there are reasons to be optimistic that maybe some of this will continue because people are talking less publicly about diversity topics, but when we dig down, it does appear they're still sending that message to potential employees. Because companies are kind of stuck. They know it's dangerous to sort of raise their hand
and call attention to themselves. But at the same time, what Becka said, the demographics of the country are shifting, and you've got to hire from the people who exist. You can't be thinking about the workers of the past. So to some degree, this is built in as a requirement for these companies to be competitive.
It's very hard to tell what has happened since then. I think, you know, twenty twenty one, big year of hiring economy very different now. A lot of the companies in our set have done layoffs, and we would love to know what those look like. There have been big cultural shifts. We don't know if those have, you know, seeped down internally into hiring managers and companies. I think, like Jeff said and our reporting, like companies and the people hiring and the people work at them do think
it's important. They think it's good for business to have different kinds of people reach different customers, not make missteps where you might get called out in the broader world. We don't know if that cultural backlash has resulted in different hiring changes, but it certainly could have. The trend is going to just demographically happen in some way, shape or form. We know that. But what's interesting to us is if the push will continue.
Yeah, Jeff, you've been working on this data for a number of years. You're waiting for new data to come. Where does the story go from here? What's your next step?
Well, I mean the question we're talking about right now, is did it continue. We'll get a really good sense of at some time, maybe mid next year, like how big of a deal was it when when people started to cut back, did they maintain these gains? An important thing to keep in mind is these are big shares of networkers, but they are very small incremental changes to these nine million people. I mean, we're talking two percentage points.
We're not talking, you know, fifty percentage points. So there's something for everyone here. If you gained only two percentage points across all these people, that's like, not very much happened. But if ninety four percent of the people who did hire are people of color, that's awesome. It's a very nuanced picture.
The big picture is that these companies still a glock side. It's very hard to make these changes. And like Jeff said, in the overall picture of at a two percentage shift, which sounds small, but then a lot's happening at the margins.
Okay, So at the lower level jobs, there's already a majority of people of color at these companies. So the bases there, that pipeline we're talking about exists inside these companies already. It's just now like Amazon did, can you move them up?
So I guess that's the big question to look for in the future is did all these people who they hired then start to occupy the middle ranks and ultimately the upper ranks of a company, which is traditionally how people rise exactly.
It is like really important to keep the focus on the fact that this is like this really great comprehensive set of data that was not available three years ago. And thanks to all the pressure that we're put on these companies, even if it's abating, the precedent is there and it's going to be difficult potentially for them to
stop releasing this data. So we're going to have this ability to watch this now that we've never had in the history of corporate America, to see like, how is this going forward and what is this going to look like? And I mean, if anything, that's like the big win here. I mean, even if this is just a snapshot, we now have an ability to kind of watch this that we didn't have three years ago.
You mentioned that these companies are feeling political pressure. Have you had any indication that some of them are going to stop giving you this data?
Not so far, And that's what we're waiting to see in terms of twenty twenty two. Did some of these reports not show up? But the trend has been in the other direction obviously, so now we'll wait and see. That is like one of the big questions you have to be answered is will there be eighty eight? Will there be ninety six? Will there be seventy five? We will find out next year sometime beca.
We've been talking about employees, but what about corporate boards. There's been a lot of effort in recent years to try to increase diversity on boards.
Broadly, boards are much easier to make more diverse than an entire huge workforce. First of all, you can just add people to boards, which is what a lot of companies have done, and they've made huge gains and gender and race and ethnicity.
The same exact trend was definitely seen in the boardroom black directors, and many companies didn't have a single black director there. Last year. We're about eleven percent from which is almost double where they started, which means black directors on boards in the S and P five hundred are now almost at parody with the population, which is astounding.
In two years, they doubled this is a proxy for how much pressure these companies felt, and in the most visible place where you can see them, the boardroom, they really responded. So that's an indication that what we were seeing was specifically in reaction to the environment that they lived in at that time.
Jeff Becca, thanks so much for coming on the show.
Thanks Wes, it's been really great to get to talk about this.
Thanks for listening to us here at The Big Take. It's a daily podcast from Bloomberg and iHeartRadio. For more shows from iHeartRadio, visit the iHeartRadio app, Apple Podcasts, or wherever you listen, and we'd love to hear from you. Email us questions or comments to Big Take at Bloomberg dot net. The supervising producer of The Big Take is Vicky Virgolina. Our senior producer is Katherine Fink. Our producers are Moe Barrow and Michael Falero. Kilde Garcia is our engineer.
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