How layoffs can unintentionally hurt a thriving diversity program

Dive Brief:

A new study reveals that when employers have layoffs, diversity may automatically take a hit --even if the employer had a strong diversity culture in place.
According to Alexandra Kalev, an associate professor of sociology at Tel Aviv University, explains in the Harvard Business Review that her analysis found that because employers continue to rely heavily on position and tenure in downsizing, their gains made in diversity efforts are lost.
She further explains that it's not about people per se, it's about the roles that women and minorities occupy, which tend to be either lower level jobs or departments (including HR). Those roles are not typically seen as core business areas, so they are the first to go. Also, she writes, women and minorities line of business jobs often work on small, nonessential product lines – making them more expendable.

Dive Insight:

Kalev says the situation is compounded by the fact that employers are downsizing more frequently when sales lag, share prices fall or M&A deals drive job loss due to staff redundancy (and these also happen more often in non-core areas).

When conducting in-depth interviews with more than 40 executives in the food manufacturing, electronics, healthcare and business services industries, she asked whether diversity factors into their organizations’ layoff decisions. They said they are focused on "erasing parts of the organizational chart," and it's not about gender or race.

However, Kalev cites a study of over 800 U.S. companies (“Why Diversity Programs Fail”) that found that when employers cut positions without any preevaluation of individual workers, they end up with an immediate 9%–22% drop in the proportion of white and Hispanic women and black, Hispanic, and Asian men on their management teams.

Kalev's work should make employers pause and consider a layoff's impact on their diversity efforts. For example, Kalev suggests that if downsizing is unavoidable, shedding managers and employees with the poorest performance rankings is a better option, because it typically has little to no impact on diversity. Of course, that also means the employer should be sure it has a good performance management system and strategy in place.