Diversity recruitment is healthy; Diversity retention isn’t: 6 things HR needs to do now

Great job, HR! Diversity recruitment is up — exactly what many companies prioritized in recent years.

But, there’s a glitch. And it’s a big one.

Diversity retention is down.

Companies are getting a more diverse workforce, but they aren’t keeping the employees.

Leaders aren’t all that impressed with the apparent backslide. In 2020, 85% of companies had DEI programs including initiatives to recruit more diversity. Now, just 20% have programs, according to DDI’s 2023 Diversity, Equity, and Inclusion Report,

What’s more, the percentage of leaders who endorse their own company’s DEI initiatives dropped by almost 20% in three years, the study also found. And guess what’s happening with this loss of trust: Underrepresented groups don’t like it and aren’t sticking around.

“With the stress of economic uncertainty and labor challenges, companies have turned their attention away from DEI toward these urgent issues, but that has left many leaders, especially those who are women and from minority racial and ethnic backgrounds, questioning their company and role,” says Stephanie Neal, Director of DDI’s Center for Analytics and Behavioral Research. “If companies don’t act now to rekindle and reinvest in their DEI programs, the loss of talent will have a profound impact on future business success.”

A company’s diversity retention struggle

Anecdotally and with candor, BlackRock Inc., one of the world’s largest money and investment managers, admitted its efforts to retain diverse talent flopped, according a self-prescribed racial audit. Black senior leaders left at the same rate they were hired in BlackRock’s DEI initiatives. And it increased its Hispanic leadership by just .5%, considering turnover after the uptick in diversity recruitment.

The top issues they uncovered: Minorities are leaving because they:

• lack clear career paths within BlackRock
• don’t feel a deep sense of trust and belonging, and
• have differing day-to-day experiences because of inconsistent management capabilities and lack of accountability.

On a positive note, BlackRock called for this audit. It’s committed to improving diversity in recruitment and retention.

What’s next for DEI?

“There is plenty of top talent in underrepresented communities, but they need to be supported and nurtured properly within a company to continue to perform at their best,” says Milena Berry, CEO of PowerToFly.

So stick with — or go back to — your DEI and hiring for diversity initiatives, adding an emphasis on retention.

To help, here are six ways to improve diversity retention.

Get every level involved

Nearly everyone in an organization can help retain a diverse workforce:

• Employees. Encourage them to raise “their hand and be vocal with their needs, while being razor focused on being a top performer. They can advocate for themselves and others, and continue what I call the ‘bottoms-up’ push for DEIB,” says Berry.
• Front-line managers. Give them inclusive leadership training. “Let’s remember training is not just for managers and leaders — everyone should be educated,” says Berry.
• C-suite. Ideally, you want to get them to “commit budget, time and executive oversight to belonging initiatives,” says Berry. “Also a distributed model of DEIB works well, where DEIB is a core competency in any business department — versus the legacy model of one separate group.”

Be clear with career paths

Career paths and opportunities for growth and development aren’t as obvious to employees as they are to HR and managers who’ve been in an organization for a while.

“Underrepresented talent are less likely to understand what promotions are available to them,” says Berry. “Clarifying career path options removes a lot of questions and unease.”

Front-line managers will want to regularly review career or development options with all employees in one-on-ones. Even better, HR can help with career mapping.

Get it right with grads

Recruiting and retaining any recent graduate hires is often a challenge for employers. So it makes it even more important to get it right with a diverse population.

“This means that as a company’s early career talent becomes more diverse, support systems need to be more varied. A generic, one-size-fits-all approach will not fit the incoming generation of workers,” says Berry.

So consider beefing up the onboarding and support programs for recent college grads in your DEI initiatives.

One way: Redefine mentorships. “Traditional mentorships are powerful, but reverse mentorship, when the tables turn and early-career talent are the ones answering questions and advising more experienced workers, can have a major impact, too,” says Berry.

Enhance growth and succession

“In an effort to boost opportunities for underrepresented groups, many organizations make the mistake of putting people in roles for which they are not prepared, without enough support to ensure success,” the DDI report found.

Managers want to give team members opportunities for growth and development. Beyond that, “organizations that succeed with DEI make a conscious effort to develop coaching capabilities across their organization to ensure people get the feedback and coaching they need to grow into new opportunities,” the report says.

So in addition to offering development opportunities, back them up with coaching on how to use what’s been gained.

Create time to reflect, connect

Help employees with similar experiences connect. And create opportunities for people to talk and share their experiences with people who don’t have the same background. Your Employee Resource Groups (ERGs) might be a good place to start these conversations.

“Listen to your diverse employees’ needs. Identify the patterns. Create regular spaces to connect with each other and learn about each other via listening circles or employee development events,” suggests Berry.

Flex flexibility

You’ll retain more employees — regardless of background — with more flexible work options. If you don’t offer some form of hybrid or flexible work schedules, diverse, qualified candidates and employees will go where they can find those.

“Gender, racial, and ethnic diversity in leadership is a clear business advantage, and you could be pushing away these highly talented leaders by taking away flexible work options,” says DDI CEO Tacy Byham. Options like remote work empower them to do their best work for the organization while meeting personal goals and family obligations.” 

Realizing success

Of course, DEI is an evolving issue. Regularly review your initiatives, measure outcomes and get feedback.

“The crux of the problem can always be traced back to the company’s level of investment in diversity, equity, inclusion and belonging. If the company commits budget and time, they will see results. Do not expect results overnight, you need to commit to this workstream for the long term, as part of your company’s long-term strategy,” says Berry.