Here's How Workplace Diversity Impacts Employee Retention

by Zoe Mackey

March 08, 2019

The research showing that diverse organizations are, on average, more profitable has been well-documented, and diversity is moving beyond just a business trend. Diversity and inclusion efforts are critical to raising the bottom line and improving the employee and customer experience.

In addition to a greater range of experiences by employees, added innovation, increased productivity, and happy consumers, organizations that report a diverse staff and inclusive workplace also tend to be better at keeping people from leaving for other jobs. Retention is an important issue for companies because the cost of replacing and retraining an employee is significant and often stifles growth and organizational success.However, even organizations that claim to be diverse are struggling with turnover, despite the fact that diversity and inclusion are core to what employees communicate they want in a workplace. What companies believe about themselves and what former employees are saying in exit interviews are often totally different stories. This may confound organizations and their leaders, but for employees, the situation is often clear—the diversity they expected wasn’t what their employers were delivering.

For businesses striving for more workplace diversity, the blind spot—otherwise known as the honest employee experience—can be difficult to overcome or even recognize. Difficult, but not impossible. Here are some areas that organizations and their leaders can focus on as they progress toward a proactive and profitable transformation.

Smarter Hiring

Many organizations start growing their workplace diversity via the hiring process. By taking the initiative to seek, interview, and ultimately hire a wider range of candidates, organizations expand the potential, innovative capacity, and creativity of their workforce.

However, diverse hiring practices don’t always translate into a more diverse workplace or improved employee retention. Unfortunately, many organizations throw much effort into changing their recruiting, hiring, and onboarding guidelines, but then fail to address the microaggressions and institutional biases that shape the company culture.

This lack of alignment among goals is disillusioning to diverse employees, who come to regret their career decisions (after such a promising start during hiring) and end up leaving for better opportunities. In fact, Jobvite’s 2018 Job Seeker Nation Study uncovered that, amazingly, 30 percent of survey respondents have left a job within 90 days. It’s critical that organizations do a better job applying the principles and enthusiasm of diverse hiring guidelines to every facet of the employee experience. This means defining and prioritizing goals throughout the company, getting managers and leaders not involved with hiring on board with diversity initiatives, and crafting diversity and inclusion as core principles of the entire organization (more on this next).

The Importance of Inclusion

Part of the disconnect organizations encounter with workplace diversity after hiring occurs because they fail to understand how diversity differs from inclusion. Diversity deals with the characteristics inherent to each employee (as well as customers), such as race, gender, age, and sexual orientation. Inclusion tackles the lived experiences employees bring to their day-to-day work and how those experiences are accepted, valued, and welcomed.

The two concepts, though inextricably bound, are distinct and require different strategic thinking and alignments—and therein lies the problem for many organizations. Companies that believe they are diverse may be far from inclusive. These organizations fail to value what their employees have to offer. They think that merely hiring a person who is in a minority group in relation to the company’s overall demographic breakdowns—such as a person of color, a woman, a member of the LGBTQ+ community, or a person of a different religious faith—is the end-all-be-all for workplace diversity goals, and do not think about how each person experiences the workplace differently. Leaders must embrace inclusion if they want to curtail employee turnover and empower people to not only want to stay, but also realize their full potential.

Breaking Through Bias

The book Erasing Institutional Bias: How to Create Systemic Change for Organizational Inclusion elucidates the tricky and often unchecked biases in the workplace. When organizations cling to these biases—both implicit and explicit, intentional and unintentional—they hold employees back. Authors Tiffany Jana and Ashley Diaz Mejias write, “When bias is addressed at the organizational level, a more diverse group of people makes the organization more successful. When more people thrive within an organization, the mission and vision can be realized with greater efficiency and focus.”

Addressing bias is a challenge; recognizing that bias exists is often an even greater challenge, but it is a critical first step. However, your employees may feel that the deck is stacked against them, which can breed frustration, helplessness, anger, and stress—things that may drive them to leave. What’s worse is that they may be suffering in silence because they don’t feel safe to surface their concerns or their honest experience of the workplace.

Some degree of turnover is inevitable, but high employee retention depends on creating an environment where people want stability and the opportunity to thrive. The journey to eliminating bias can start with you—what preconceptions might you bring to your daily decision-making and interactions? Are you willing to identify your biases, or do you believe you don’t harbor any? The truth is that we all have biases. The only way we can prevent our biases from perpetuating the various systemic -isms, such as racism, sexism, or ableism, is to do an honest assessment. Acknowledging and overcoming your own biases creates a culture in which others recognize and overcome theirs.

Creating Real and Lasting Change

“Imagine the effort it must take to wake up every morning with the daunting task of walking into an environment that tests your beliefs about who you can and could be as well as what you truly deserve.” These words open the introduction of the upcoming book Dig Your Heels In: Navigate the Corporate BS and Build the Company You Deserve by Joan Kuhl. Kuhl openly advocates for digging our heels into the companies we work for and doing the hard work to create the opportunities, employee experience, and workplace culture we deserve. Imagine if all employees felt inspired and motivated to contribute honestly and directly to nurturing their own positive employee experience: Retention would skyrocket, and the organization would be able to truly boast a culture of inclusion and organizational success.

Achieving change by improving workplace diversity and employee retention can seem daunting. However, as explored earlier, one leader deciding to change their mindset is a giant step, even if it only benefits their immediate team. Real change isn’t always the slog we fear, but it does require bold thinking and actions—which are often blessedly contagious.

Topics: Your Organization, Diversity & Inclusion, Staff Retention Strategies, Organizational Change and Development

The Ultimate Guide to Employee Development: 6 Critical Components for Any Training Program

BK Footer - Email Subscription form