We hear and read a lot of information about the U.S. workforce. Government reports provide data about unemployment, labor force participation rates, job openings, employee quit rates and more. This information is reported in aggregate and often broken down by region of the country, by race, by gender, by age, by industry and other categories. But despite the fact that nearly 60% of the U.S. workforce is paid on an hourly basis, it’s not often that we see employment data segregated by hourly and salaried workers. Here, we will explore diversity issues within the hourly workforce.
In December 2020, the U.S. Bureau of Labor Statistics published a report entitled, “Labor Force Characteristics by Race and Ethnicity, 2019.” The data in the report was obtained from the Current Population Survey which is a monthly survey of about 60,000 households in the United States.
According to the report, Whites make up the majority of the labor force at 61%. Hispanics make up 18% of the workforce, Blacks are 12% of the workforce, Asians are 6% of the workforce with other races making up the remaining 3%. Presumably in an ideal world, every company would have a workforce at or near those proportions by race. However, as it pertains to the hourly workforce, there are some interesting differences.
Our company provides recruiting solutions with an emphasis on distributed hourly hiring. Many of our clients have a high proportion of hourly workers in their workforce. As their applicant tracking system provider, we see millions of applications every year and help clients analyze their data to optimize the talent acquisition process.
If we simplify labor force race into minorities and majority (whites), we might expect that job applications would consist of 39% of minorities and 61% whites.
But that’s not normally what we see at Cadient for the hourly workforce. Many of our clients receive most of their job applications from minority candidates. And many of our clients have an hourly workforce that consists of minorities in a higher proportion than the overall labor average of 39%. Some are significantly higher.
There are likely many reasons for this disparity in the hourly workforce. Issues such as education, work experience, socioeconomic, and other factors well beyond the scope of this discussion come into play. For this blog, we’re attempting to examine the diversity situation in the hourly workforce and offer suggestions as to how to improve or maintain it.
One of the comments that I hear is that companies have a difficult time sourcing diverse candidates. There are job boards that specialize in reaching and attracting minority candidates. But, allowing for some exceptions for our client base, we don’t generally see that the problem is not sourcing enough minority candidates.1
So, if you have proper diversity of candidates but are not meeting your diversity goals within the workforce, where does the problem lie? It’s one or both of two things.
The first is that perhaps your diverse candidates don’t meet the qualifications set forth in your company’s job requirements. To be honest, at Cadient, we don’t really see that either. For a number of our clients, we provide a decision support system called Cadient Decision Point to evaluate every candidate against a set of criteria to determine which applicants will become quality hires. In every case, we eliminate candidate data such as race, age and gender and any other potentially discriminatory data before making the recommendation. If after the recommendation we add that data back, our experience is that the percentage of recommended candidates by race is fairly comparable across all races.
If we’re getting diverse candidates and the percentage of recommended candidates by race is fairly comparable, the second potential issue is the hiring decision itself. Are your recruiting and hiring managers truly making hiring decisions in an unbiased way free from discrimination? Again, with Decision Point we can see on a recruiter by recruiter or hiring manager by hiring manager basis, which ones are following the recommendations and truly hiring in an unbiased way.
If you do have a diversity challenge, it’s critical to break the process down. Your opportunity lies in one or more of three areas: (1) Your candidate pool needs to be more diverse; (2) Your diverse candidates may not meet your job requirements; and (3) Your recruiters and hiring managers may not be totally unbiased in their hiring decisions.
If you’re serious about DE&I, breaking down your talent acquisition into these three areas to identify challenges and opportunities is critical. Cadient Decision Point is a solution designed to help you accomplish that very thing.
1In this environment of November 2021 most companies are experiencing an overall reduction in the number of candidates and applications received, but we are not seeing a significant change in the racial profiles of candidates.