Chapter 16

Managing a Diverse Workforce

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 Ch. 16 Key Learning Objectives
 Knowing in what ways the workforce of the United States is diverse,
and evaluating how it might change in the future.
 Understanding where women and persons of color work, how much
they are paid, and roles they play as managers and owners.
 Identifying the role government plays in securing equal employment
opportunity for historically disadvantaged groups, and debating
whether or not affirmative action is an effective strategy for
promoting equal opportunity.
 Assessing the ways diversity confers a competitive advantage.
 Formulating how companies can best manage workforce diversity,
making the workplace welcoming, fair, and accommodating to all
employees.
 Understanding what corporate, policies and practices are most
effective in helping today’s employees manage the complex, multiple
demands of work and family obligations.
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 The Changing Face of the Workforce
 Diversity: variation in the important
human characteristics that distinguish
people from one another.
 Primary dimensions: age, ethnicity, gender, mental
or physical abilities, race, sexual orientation
 Secondary dimensions: characteristics such as
communication style, family status and first language
 Workforce diversity: diversity among
employees of a business or organization
 Represents both a challenge and an
opportunity for businesses.

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 The Changing Face of the Workforce
 Today, the U.S. workforce is as diverse as it ever has
been. Consider the following workforce diversity trends:
 Immigration has profoundly reshaped the workplace
 By 2023, more than one in seven residents are expected to be
foreign-born; they are concentrated in the U.S. West and South.
 Ethnic and racial diversity is increasing
 Asians are now the fastest-growing segment of the labor force.
 The workforce will continue to get older
 Between 2006 and 2016, the number of persons aged 65 to 74 who
are still working is expected to jump 84 percent.
 Millennials are entering the workforce
 Managers find Millennials to be quick learners and more
technologically adept than their seniors, but also narcissistic (self-
centered) and hard to retain.

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 Gender and Race in the Workplace
 Following World War II, the proportion of women working
outside the home has risen dramatically.
 In 1950, about a third of adult women were employed.
 Peaked at 59 percent in 1999, stabilized for a few years, and then fell slightly to
57 percent in 2013.
 Lack of family-friendly policies made it for more difficult for mothers to work.
 Men’s participation rates declined between 1950 and 2013.
 The proportion of adult men who worked fell from 86 percent to slightly less
than 70 percent.
 Labor force rates for minorities have always
been high.
 Change is that wider range of jobs are available to
minorities as discrimination barriers have fallen.

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 Proportion of Women and Men
in the Labor Force, 1950-2013
Figure 16.1

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 The Gender and Racial Pay Gap

 Pay gap: Women and persons of color on average

receive lower pay than white men do.
 Gap has narrowed over the past quarter century.
 In 2013 black men still earned only slightly more than
three‑quarters of white men’s pay; black women earned about 69
percent, and white women 82 percent.
 The pay gap for both Hispanic women and men declined by about
5 percent since 2000.
 The one group that tops white men in median weekly earnings is
Asian-American men; they make about 20 percent more, on
average.
 Important reason is education.

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The Gender and Race Pay Gap, 1990-2013
Figure 16.2

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 The Gender and Racial Pay Gap

 Possible reasons for gender pay gap:

 Sex discrimination
 Women’s choices to pursue lower paying
jobs or slower advancement
 Occupational segregation:
 Inequitable concentration of a group in
certain job categories
 Pink-collar ghetto: sex-typed jobs
 Women have made great strides in entering
professional occupations, however “pink
collar ghetto” still exists.
 Examples: preschool teacher, hairdressers,
dental hygienists

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 The Gender and Racial Pay Gap

 Women still earned 5 to 7

percent less than they
otherwise would have in
education, experience, race,
industry, and occupation.
 One area of the economy
where racial and gender
discrimination seems
stubbornly persistent is high
technology.

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Women and Persons of Color in Management

 Women have broken into

management ranks.
 Women managers tend to be
concentrated in occupations where
women are numerous, like education
and health care
 And in service industries and in
finance, insurance, real estate, and
retail businesses.
 Women managers have made gains in
newer industries.
 Example: biotechnology

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Women and Persons of Color in Management

 Blacks make up 13.4 percent

of educational administrators.
 Hispanics are best
represented in food service
management.
 Asians are somewhat
overrepresented in
management ranks,
particularly in the field of
information systems.

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 Extent of Diversity in Selected
Management Occupations
Figure 16.3

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 Breaking the Glass Ceiling
 Although women and minorities are
as competent as white men in
management, they rarely attain the
highest positions in corporations.
 Glass ceiling: Invisible barrier that
exists in reaching these higher
levels has been named the glass
ceiling.
 Recent advances show some
cracking of the ceiling.

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 Reasons for the Glass Ceiling

 Glass walls: fewer opportunities to move into

positions that lead to the top; many women and
minorities start in staff rather than line positions.
 Recruiters fill positions by word of mouth, using
“old boys network.”
 Companies lack commitment to diversity.
 Too little accountability for equal employment
opportunity at top management levels.

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Women and Minority Business Ownership

 Some women and minorities have chosen to avoid

the glass ceiling by opening their own businesses.
 By the mid-2010s, 40% of over 10 million U.S.
businesses were owned or controlled by women.
Example: Tina Wells, the Buzz Marketing Group founder
 Among minority-owned firms active in the mid-
2010s, Hispanic-owned businesses were the most
numerous, followed by African-American and
Asian-owned businesses.

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Women as a Percentage of Members of Boards of
Directors, Selected Countries, 2014
Figure 16.4

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 Breaking the Glass Ceiling

 Recent studies have shown:

 Companies with a higher proportion of women on their
boards were less likely to be involved in corruption and earned
higher scores for management of carbon emissions, toxic
releases.
 Adding even a single woman to a board of directors improved
corporate governance practices, with a particularly strong
effect in traditionally male-dominated industries like mining
and energy.

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 Why would adding women to boards
improve performance?

 More diverse boards avoid a rush

to consensus and realistically
consider alternative courses of
action.
 Women bring different life
experiences to the table and are
more likely to raise multiple
stakeholder concerns.
 Having more diverse boards also
signals to the public a company’s
commitment to diversity and
inclusion.

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 Equal Employment Opportunity

 Discrimination based on
race, color, religion, sex,
national origin, physical
or mental disability, or
age is prohibited in all
employment practices.

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 Equal Employment Opportunity

 Government
contractors must have
written affirmative
action plans detailing
how they are working
positively to
overcome past and
present effects of
discrimination in their
workforce.

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 Equal Employment Opportunity

 Women and men must

receive equal pay for
performing equal work,
and employers may not
discriminate on the
basis of pregnancy.

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 Major Federal Laws and Executive Orders
Prohibiting Job Discrimination
Figure 16.5

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 Affirmative Action
 Purpose: to reduce job discrimination by encouraging
companies to take positive steps to overcome past
discriminatory employment practices.
 Affirmative action has long been
controversial.
Example: racial preferences at the University
of Texas
 Critics of affirmative action say:
 It is inconsistent with the principles of fairness and equality.
 In some cases, one group could be unintentionally
discriminated against in an effort to help another group.
 These programs can actually stigmatize or demoralize the very
groups they are designed to help.

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 Sexual Harassment
 Government regulations ban sexual and racial harassment.
 Sexual harassment at work occurs when:
 An employee, woman or man, experiences repeated, unwanted sexual
attention or
 On‑the‑job conditions are hostile or threatening in a sexual way
 It includes both physical conduct
Example:
 Suggestive touching
 Verbal harassment
 It can also occur if a company’s work climate is
blatantly and offensively sexual or intimidating to employees.
 Illegal, U.S. EEOC is empowered to sue on behalf of victims.
 Sexual harassment cases are settled in arbitration hearings
 so the amounts paid are not made public.

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 Racial Harassment

 Illegal, under Title VII of the Civil

Rights Act
 Under EEOC guidelines, ethnic
slurs, derogatory comments, or
other verbal or physical
harassment based on race are
against the law
 if they create an intimidating, hostile, or
offensive working environment or
interfere with an individual's work
performance.

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Preventing Sexual and Racial Harassment

 In 1998, the Supreme Court ruled that companies

could deflect lawsuits by taking two steps:
 Developing a zero-tolerance policy on harassment and
communicate it clearly to employees
 Establishing a complaint procedure—including ways to report
incidents without retaliation—and acting quickly to resolve
any problems
 Companies that took such steps would be
protected from suits by employees who claimed
harassment but had failed to use the complaint
procedure.

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 What Business Can Do:
Diversity and Inclusion Policies and Practices

 Actions companies can take to manage diversity and

promote inclusion effectively:
 Articulate a clear diversity mission, set quantitative objectives, and hold
managers accountable
 Spread a wide net in recruitment, to find the most diverse possible pool
of qualified candidates
 Identify promising women and persons of color, and provide them with
mentors and other kinds of support
 Set up diversity councils to monitor the company’s goals and progress
toward them
 Diversity council: A group of managers and employees responsible
for developing and implementing specific action plans to meet an
organization’s diversity goals.

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Strategic Advantages of Managing Diversity and
Inclusion Effectively

 Having a widely diverse workforce boosts

innovation, many executives believe.
 The global marketplace demands a workforce with
language skills, cultural sensitivity, and awareness
of national and other differences across markets.
 Companies with effective diversity programs can
avoid:
 Costly lawsuits
 Damage to their corporate reputations from charges of
discrimination or cultural insensitivity

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 Balancing Work and Life

 How can companies

best help
employees balance
the complex,
multiple demands
of work and family
life?

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 Child Care and Elder Care
 Types of programs companies are offering:
 Child care
 Elder care
 Parental and family leave
 A major source of workplace stress for working parents is
concern about their children.
 Problems with child care are a leading reason why employees fail
to show up for work.
 Studies have found that child care programs help
 To reduce absenteeism and tardiness
 To improve productivity
 To aid recruiting, by improving the company’s image
 To retain talented employees

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 Child Care and Elder Care

 Forty-two million adults in the United

States now care for an older person.
 More than half (58 percent) of family
caregivers are currently employed.
 Many firms offer referral services,
dependent care accounts, long-term
care insurance, and time off to deal
with the often unpredictable crises
that occur in families caring for
children and elders.

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 Work Flexibility
 Companies have also accommodated the changing roles of
women and men by offering workers more flexibility through
such options:
 flextime
 part-time employment
 job sharing
 working from home
 These arrangements can benefit employers by attracting and
retaining valuable employees, reducing absences, and
improving job satisfaction.
 However, many women and men have been reluctant to take
advantage of various flexible work options
 Fearing that this would put them on a slower track, sometimes disparagingly
called the Mommy track or Daddy track.

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 LGBT Rights at Work

 An important step businesses can take is to

support their lesbian, gay, bisexual and
transgender employees.
 89 percent of Fortune 500 companies include sexual
orientation in their nondiscrimination policy, and two-
thirds include gender identity.
 Some companies are phasing out domestic partnership
benefits in the wake of the legalization of same-sex
marriage.

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 The Family-Friendly Corporation
 Family-friendly corporation: firms that would fully
support both men and women in their efforts to
balance work and family responsibilities.
 Job advantages would not be granted or denied on the basis of
gender.
 People would be hired, paid, evaluated, promoted, and extended
benefits on the basis of their qualifications and ability to do the
tasks assigned.
 The route to the top, or to satisfaction in any occupational category,
would be open to anyone with the talent to take it.
 The company’s stakeholders, regardless of their gender, would be
treated in a bias-free manner.
 All laws forbidding sex discrimination would be fully obeyed.

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