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Date: 2019
Encyclopedia of Management
From: Encyclopedia of Management(Vol. 1. 8th ed.)
Publisher: Gale, a Cengage Company
Document Type: Topic overview
Pages: 7
Content Level: (Level 4)

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The advent of equal employment opportunity laws and affirmative action programs created new employment opportunities for members of protected groups that had previously been victimized by employment discrimination. The demographic mix within the twenty-first-century workplace has consequently become much more diverse, a result not only of these laws but also of the globalization of business. Furthermore, the changing demographics of the United States have affected worker diversity.

These new realities add up to a different-looking workplace. No longer are the majority of workers white, male, and English speaking. People of color continue to increase their share of the labor force as these groups grow more rapidly than whites. In fact, white non-Hispanics are projected to continue to decline as a percentage of the labor force. In contrast, the Hispanic population growth will be a key and growing portion of a more diverse workforce, according to the Bureau of Labor Statistics. By 2024 Hispanics are predicted to make up nearly 20 percent of the total labor force.


In the United States, the average age of the workforce is getting older, mirroring the age demographics of the population. The number of workers 55 and older was estimated at more than 36 million in 2017. The labor market will continue to be significantly affected by the aging of the baby boom generation. In fact, a study done by AARP in 2016 revealed that a majority of the respondents anticipated working past the age of 65. Eleven percent said they expected to keep working into their 80s. Moreover, more retirees are returning to the workforce.


The workforce is also experiencing a dramatic increase in the number of dual-income families, many of whom have young children. In 2015 women made up 46.8 percent of the workforce, compared to less than 40 percent in 1975. This percentage is expected to creep steadily upward, with the Bureau of Labor Statistics projecting that women will account for 47.2 percent of the workforce by 2024. The workforce is also showing an increase in single-parent families and families facing the demands of elder care.

To provide opportunities for the new population of workers, businesses are allowing more flextime, telecommuting, and sabbaticals. They are also training line managers to respond to the cultural, lingual, generational, and technological differences that the new workforce introduces. This represents a change from the past, when organizations ignored the impact that diversity had on the attitudes and behavior of employees.

When years of political, social, and legal change brought new groups of employees into the workplace, organizations at first attempted to handle these new groups through assimilation; simply put, people were expected to fit in. Equal treatment at the workplace meant the same treatment for each employee; individual differences were ignored. Fear of being accused of discrimination by offering differentiating treatment also drove much of this behavior, as employers and employees alike were still learning how to adjust to the changing demographics around them. Consequently, assimilation often resulted in pressure to conform, exclusion and isolation, and reinforcement of the dominant group values. The problem became compounded as the number of diverse groups within an organization increased and the number of white males declined.

The failure to deal effectively with the diversity issue can hinder competitive advantages. For instance, firms choosing to do business as usual have been plagued with a high turnover among nontraditional employees, low morale within the organization, underutilization of employee skills, numerous intergroup conflicts, low productivity, and an inability to attract new workers. On the other hand, if diversity is dealt with effectively, competitive advantage can be enhanced. For instance, companies that value diversity can attract a larger and better pool of applicants than companies that limit themselves to a traditional workforce.

Accommodating the needs of the diverse workforce is more important to organizations in the twenty-first century than ever before. When properly managed, such cultural diversity can represent a key strategic advantage. Diversity in age, gender, race, sexual identity, and viewpoint can offer organizations a number of benefits, including additional knowledge, creative ideas and insights to aid in problem solving, enhanced product positioning, better development of strategic plans and objectives, and Page 282  |  Top of Articlefresh opinions. These diverse workers can bring original ideas and approaches to the workplace that can help a firm target its products and services to a marketplace that is becoming increasingly diverse. This adds economic importance to the issue of diversity. For instance, in 2017 the combined African American, Hispanic American, Native American, and Asian American buying power was nearly $4 trillion.

A growing number of companies are recognizing the competitive advantages that diversity brings with it, and many are hiring diversity officers or otherwise instituting programs designed to maximize the diversity of their business. For example, in 2017 CNN International promoted its vice president of talent recruitment, Ramon Escobar, to the new position of vice president of diversity and inclusion. “Never has diversity been more important as media transforms to face its new challenges as a global organization,” Escobar told Adweek in January 2017. “The business case for diversity has never been stronger than it is now.” Other companies are recognizing that this growing diversity can be a significant advantage in an increasingly smaller world.


Although minorities have been entering the workforce in record numbers, for years minorities have faced invisible, subtle, yet very real institutional barriers to promotions into higher-level executive positions. The belief that minority groups reach organizational plateaus consisting of artificial barriers that derail them from senior management opportunities has been alternately termed the “glass ceiling” or the “brick wall.” The barriers found in the structure of many organizations have often stymied the advancement of these select employee groups.

How can the glass ceilings be cracked or the brick walls broken down? Effective diversity training is one way companies are trying to encourage decision makers to overcome their biases. However, diversity training by itself is not enough, and diversity management must not be confused with affirmative action. The Society for Human Resource Management recommends the following components for a successful diversity initiative:

  1. Get executive commitment. Enlisting the visible support and commitment of the organization's CEO is fundamental to a successful diversity initiative.
  2. Articulate the desired outcomes. Be explicit about how support and commitment are to be shown and from whom it is expected.
  3. Assess the climate, needs, and issues at your organization. The use of focus groups can help clarify the obstacles. It will prove helpful to determine where an organization is currently on the diversity continuum before determining what interventions need to be taken.
  4. Create and maintain open channels of communication with employees at the launch of a diversity initiative and throughout the process. Communication is crucial to the success of a diversity plan and should occur not only at the beginning of a diversity initiative but also throughout the process.
  5. Consider forming a diversity taskforce to widen the support base. This group can help analyze assessment data and make recommendations to top management.
  6. Develop a mechanism for dealing with systemic changes and procedural problems. Once identified, obstacles and problems must be addressed. For example, a company may be committed to hiring people outside of the dominant culture but has difficulty promoting those same individuals once they are with the organization.
  7. Design relevant, interactive, applicable training. The purpose of good training is not just to increase awareness and understanding about diversity but also to develop concrete skills that employees can use to deal with workplace diversity, its implications, and its effects.
  8. Evaluate and measure each component of the diversity initiative (training, taskforce, mentoring initiative, employee networks, etc.). Set measurable criteria and determine what is to be accomplished and how data is to be gathered.
  9. Ensure integration and accountability. Integrate the concepts, skills, and results of diversity efforts into the fabric of the organization and hold management accountable for encouraging diversity throughout the organization.


Diversity of sexes in the workplace is also an important issue. Statistics indicate that women produce approximately half of all food in the world and work approximately two-thirds of the total working hours in the world. Despite the fact that women worldwide make up the majority of the workforce, they earn 23 percent less than men worldwide.

While violence against women and inherent systematic discrimination is more rampant in countries outside the United States, issues regarding true gender diversity in the workplace still remain a major concern. One of the largest antidiscrimination lawsuits in history concerned a class of female plaintiffs alleging Walmart treated them unfairly in terms of both hiring and promotion. (This Page 283  |  Top of Articlecase reached the U.S. Supreme Court in March 2011.) As the nation's largest employer, allegations of discrimination on such a grand scale indicate that, although women have made significant advancements in the workforce, there is still a need for improvement.

In addition to discrimination in hiring, promotion, and pay, women are the most frequent targets of sexual harassment in the workplace. Sexual harassment can range from unwanted sexual advances or comments to the creation of an uncomfortable, sexually charged atmosphere to open hostility and even sexual assault. The Me Too movement, which erupted culturally in the United States in 2017, also cast light on all-too-common sexual misconduct at the highest levels of the corporate and entertainment world. The movement saw dozens of well-known, high-profile male executives and other leaders publicly accused of sexually pressuring and abusing employees and associates. Numerous CEOs, executives, and other prominent figures resigned or were fired over the course of a series of scandals, leaving companies to struggle to clean up the public relations damage.


An aging workforce portends numerous advantages to an organization's operational processes and human resources planning strategies. Work experience is an advantage that is widely associated with the older generation of employees because experience reduces training costs and ensures the achievement of quality benchmarks for an organization's work processes. The advanced skill development in turn makes the older workforce more reliable in decision making and in the execution of their assigned duties.

The older generation of employees is indeed more productive, considering that it takes time and effort for employees to learn work processes, gain experience, and expand their skills through continuous learning processes. Honesty, creativity in problem solving, ability to develop loyal relationships with clients, and focus on the achievement of organizational goals are some of the reasons that were attributed to the high productivity output of older employees in sales. The other positive attributes of the older generation workforce include:

  • Older workers are flexible regarding varied schedules.
  • The organization benefits from the mentorship of the older generation of workers.
  • The older generation workforce is considered to be more ethical in work approaches.
  • The older generation is not susceptible to high turnover and has a great deal of loyalty to the organization's principal objectives.
  • Older employees have a well-established networking capacity that aids in expanding the organization's influence.

As for disadvantages, organizations employing high numbers of aged workers become susceptible to issues such as intergenerational tensions, unsustainable costs of health care, shortage of skilled employees, and the aged population's overreliance on the younger workers to handle technical aspects of their work. Hiring and retaining older employees is expensive because they demand high salaries, experience retraining difficulties, resist change, post frequent absenteeism, and remain prone to high rates of workplace injuries compared to younger workers.

Multigenerational Workforce Multigenerational Workforce


The acronym LGBTQIA is used collectively to refer to the issues and identities of those who identify as lesbian, gay, bisexual, transgender, queer (or questioning), intersex, and asexual or allied. These terms are all associated with various sexual or gender orientations. It is important to note that cultural discussion of gender and sexual identity is ongoing and ever evolving and that preferred terminology may continue to change over time.

Members of the LGBTQIA community have faced prejudice throughout human history. Many have resorted to concealing their orientations in public and at work to Page 284  |  Top of Articleavoid harassment and discrimination. In the early twenty-first century, it has become more commonplace for LGBTQIA individuals to express their true identities through modes of dress and behavior, as well as through open discussion.

Many companies have extended their “zero-tolerance” policies concerning racial, religious, or sexual discrimination to also cover discrimination against sexual orientation or gender identity as well. As of 2017 some 91 percent of Fortune 500 companies included sexual orientation in their nondiscrimination policies. Eighty-three percent forbid discrimination based on gender identity. Sixty percent of these companies extend benefits to domestic partners, and 58 percent offer benefits that are considered transgender inclusive. Companies who have not yet put such policies into force should strongly consider doing so.

As of 2018 28 U.S. states allowed employees to be terminated simply on the basis of sexual orientation or gender identity. No federal law specifically prohibits such workplace discrimination, and courts remain split as to whether general federal antidiscrimination laws, such as Title VII, should be interpreted to include such discrimination. Companies that wish to embrace workplace diversity should ensure that their own nondiscrimination policies specifically include the LGBTQIA community. As a practical matter, many companies need such policies in place to avoid running afoul of state and local requirements, as well as potential future federal regulation.

In a 2016 article for Entrepreneur, Charles Donnell, a leadership and management consultant for IBM, recommended that, beyond simply adding new policy language, companies should take proactive steps to foster a more inclusive workplace. LGBTQIA employees should unquestionably be allowed to identify openly at work, and companies can set a public example by participating in LGBTQIA-friendly activities, such as PRIDE parades. Managers and executives can also set an example with clear messages of inclusiveness and positive support. Offering LGBTQIA-friendly benefits also sends a clear message. The days of “Don't Ask, Don't Tell” are over. According to Donnell, “providing a culture of openness and transparency is key.”


Managing a diverse workforce entails planning, controlling, and implementing functional and organization-wide activities and systems in a manner that harnesses the potential benefits of a pool of employees who have varied individual abilities, races, creeds, and cultures while minimizing any potential drawbacks to such a group. This involves creating a supportive working environment and self-advancement opportunities to all employees, regardless of their backgrounds.

Organizations that are committed to the foundational principles of a diverse workforce extend employment opportunities to applicants of varied qualifications, backgrounds, and origins. As such, the establishment and nurturing of a diverse workforce is a process that shows the organization is capable of achieving homogeneity of purpose through people with varied characteristics and capabilities. The dynamics of a diverse workforce are manifested in the organization's employee recruitment and development, organizational development, external interactions, and cultural interactions.


The whole-person concept is a psychological approach to interpersonal relationships that advocates the perception of others from a holistic perspective. The concept proposes that, because human beings are made up of body, mind, heart, and spirit, they should always be treated as such. The ability to appreciate the knowledge, abilities, and talents of other individuals is largely influenced by the perception of their wholeness. In an organizational environment, such perceptions of wholeness provide the platform for empowering and motivating employees because of the appreciation of their capabilities, regardless of physical, racial, and cultural differences.

The legal bases for a diverse workforce in the United States are identifiable in numerous federal laws and state bylaws on equal employment opportunity. The Civil Rights Act of 1866, the Civil Rights Act of 1968, Executive Order 11246, the Civil Rights Act of 1991, and other legislations prohibit discrimination based on race, color, religion, sex, or national origin in employment practices. The U.S. Congress and Senate have over the years passed numerous other laws that touch on specific areas of diversity, including the National Origin Discrimination Act, Age Discrimination in Employment Act, Americans with Disabilities Act, and Pregnancy Discrimination Act.


The adoption of a diverse workforce portends numerous benefits for an organization by exposing it to employees of varied skill sets and backgrounds. A diverse workforce particularly mirrors the composition of the community that constitutes the organization's external environment, in addition to enhancing the its competitive edge. Some of the other key benefits of a diverse workforce are listed below.

  • A diverse workforce enhances flexibility in adapting to the ever-changing market conditions that are characteristic of a competitive environment.Page 285  |  Top of Article
  • The heterogeneous nature of a diverse workforce is a platform of innovation and creativity, because diversity fosters an environment for both self-initiated and group-initiated advancement of research, as well as problem-solving efforts.
  • Organizations that demonstrate success in developing and nurturing a diverse workforce earn favorable reputations as the employer of choice for both existing and prospective employees.
  • Properly executed management of a diverse workforce reduces employee turnover because employees are motivated by the organization's sensitivity to needs and continuous exposure to learning opportunities.
  • Organizations that are racially and culturally diverse expand comfortably into emerging and international markets.

The management of a diverse workforce is a process that is characterized by many issues and challenges, with particular regard to the recruitment of employees from minority populations and underutilized groups with varied cultural backgrounds. Discrimination against women has particularly been a major issue because of reservations over the likelihood of family responsibilities overshadowing their commitment to their careers. With the retirement of baby boomers underway, many organizations in the United States are faced with skill shortages. The constitution of a diverse workforce remains one of the best alternatives for addressing these skill shortages because it enables organizations to expand the scope of workforce recruitment to include traditionally marginalized groups. Moreover, the growing socioeconomic and political influence of minorities in the United States is a development that has not been lost on many employers.

Organizations experience the challenges of filling vacant positions that consistently emerge as employees retire, leave for greener pastures, or get dismissed. Conducting recruitment for skilled labor on the basis of the guiding framework for a diverse workforce is a challenging experience. Organizational managers are required to go beyond their traditional sources for job applicants by extending employment offers to qualified applicants pursuing careers outside the targeted industry, as well as interested applicants from minority groups.

A banking organization, for example, should look beyond the financial industry and consider attracting and recruiting job applicants from other industries, such as transport or tourism. This approach optimizes the accessibility of the organizations to prospective employees who possess a combination of varied attributes in the diversity continuum. However, the recruitment of a workforce with multidisciplinary backgrounds is susceptible to major setbacks due to longstanding stereotypes and negatively oriented beliefs. This is because of the prevalence of some misconceived notions about qualifying conditions for working in certain industries or professions.


The realization of a diverse workforce is a process that requires a long-term commitment from an organization. A diverse workforce is a core component of pragmatically oriented organizations that seek to draw competitive advantage from progressive thinking. An organization can achieve meaningful strides through simple initiatives such as closely monitoring the progress of a diverse workforce and using a variety of internal and external communication channels, including websites and newsletters, to showcase its diverse composition.

Employees should always be trained to understand the changing trends in an organization's operational and strategic functions that are occasioned by the diverse composition of the workforce. This is because continuously trained employees tend to become more proactive and responsive to the sociocultural, political, and economic factors inherent in the internal and external organizational environments. Training further enables a diverse workforce to experiment with the creative and unique capabilities that are characteristic of their talents and knowledge.

Proper training of frontline managers is a particularly important aspect in the retention of employees operating under a diverse workforce platform. Frontline managers shoulder much of the responsibility of interacting and articulating the organizational policies to the rest of the employees under their charge. As such, their attitudes toward their subordinates, as well as the manner in which they treat and interact with subordinates, ultimately determines the extent to which an organization can attract and retain a diverse workforce. Training, therefore, enables frontline managers and supervisors to understand that their attitudes and actions can either motivate or demoralize their subordinates. To this end, the efforts of managers to attract and retain a diverse workforce should:

  • Guarantee equal employment opportunities through clearly documented policies.
  • Emphasize the organization's commitment to equal employment opportunities in the mission statement.
  • Advertise job openings through communication media that are accessible to both the organization's employees and diverse external audiences.
  • State realistic qualifications required for different positions and ensure that the stated qualifications resonate with the prevailing and future needs of the organization.Page 286  |  Top of Article
  • Interact with employees consistently and listen attentively to their suggestions for improving organizational processes or to complaints about their unpleasant experiences in the organization.
  • Establish effective procedures for handling employee complaints.
  • Facilitate feedback communication with emphasis on down-to-top rather than top-down communication to ensure that employees get timely responses to their queries or requests for clarification.
  • Maintain sensitivity toward the different cultures of the employees that constitute the diverse workforce.
  • Develop and maintain contacts with local communities and educational institutions with the objective of networking and tapping into the diversity inherent in these institutions.


Inclusive companies have similar characteristics. They usually support local diversity groups; have clear, written antidiscrimination policies; and allow and support diversity-employee-affinity groups to encourage the networking and mentoring needs of their employees. They also incorporate company-wide diversity training as a standard part of their business.

Dealing with diversity is a continuing process that enhances an organization's ability to adapt and capitalize on an increasingly complex world and global marketplace. Changes in American society have brought unprecedented social diversity into the workforce. Immigrants from all over the world and societal segments that have been excluded or poorly represented in the past are entering new professions and attaining management and leadership roles. Corporate cultures, employment policies, and networks of influence have been forced to change. The principal challenge for U.S. employers in the twenty-first century lies less in finding diverse talent but in developing it and creating an environment that supports social cohesion amid the diversity. A well-managed diverse workforce can give companies the competitive advantage necessary to compete in a global economy.



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Source Citation

Source Citation   

Gale Document Number: GALE|CX7617900090