Diversity is Proven to Increase Growth

Diversity in the Workplace

The workplace continues to get more diverse. Women are entering the workforce in increasing numbers, while LGBTQ workers are increasingly more open about who they are, helping to jumpstart the American economy. Businesses are better understanding the benefits of diversity, as those companies who make an effort to hire a diverse workforce are seeing the benefits in company innovation and workplace productivity. Diversity helps to spur the US economy, but what are its other intrinsic benefits?

The Benefits of Diversity

Employers who hire a diverse workforce experience less turnover cost- Whether through discrimination or a lack of interest in promoting diversity, businesses who do not hire a diverse workforce are going to accrue higher turnover costs to replace employees. Businesses can expect to spend between $5,000-10,000 dollars to replace an hourly worker, while replacing a departing executive could cost a company between $75,000-$210,000, money that could be spent on primary business operations. A diverse makeup of employees and a bias-free hiring attitude can also widen the candidate pool for businesses to hire from.

Businesses Can Expand Their Market Share- Businesses who proactively hire diverse candidates from different backgrounds can also expand their market share. Hiring women, people of color, or gay, lesbian and transgender employees allows for businesses to better understand those markets, helping them capture more business. The gay and lesbian market alone is worth over $1 trillion!

Diversity is an Economic Driver- More diversity, less money problems. A diverse workforce is a major drive of the US economy. As a McKinsey and Company study showed, women went from holding 37 percent of all jobs to 40 percent,  a number that accounted for a quarter of the current GDP.

Diversity Spurs Innovation, Increasing the Bottom Line- A workforce of diverse backgrounds and opinions prevents groupthink and helps a business's bottom line. According to a survey run by the Center for Talent Innovation, employees of firms with diverse leadership experiences a 45% growth in market share over the previous year. Some of the biggest employers in the world agreed- 85% of companies with over $500 million in revenue said that diversity was important in fostering innovation.

America is built on diversity, as people from a variety of backgrounds and ethnic groups have created some of the biggest businesses in the United States. It is a tenant of entrepreneurialism; people of color own 22.1 percent of U.S. businesses, women own 28.8 percent, and gay and transgender individuals own 1.4 million American businesses. Latina businesses in particular are the fastest growing segment of women-owned businesses.

As a leader in corporate communications, FairWords understands that companies need help understanding and promoting diversity in the workplace. Diversity isn’t just something that companies can do just for show- it is necessary for growth and innovation.