Bloomberg, September 25, 2023
For a brief moment in 2020, much of corporate America united around a common goal: to address the stark racial imbalances in their workplaces.
Mass protests sparked by the murder of George Floyd led to a flurry of company promises, both specific and vague, to hire and promote more Black people and others from underrepresented groups.
The US Equal Employment Opportunity Commission requires companies with 100 or more employees to report their workforce demographics every year. Bloomberg obtained 2020 and 2021 data for 88 S&P 100 companies and calculated overall US job growth at those firms.
In total, they increased their US workforces by 323,094 people in 2021, the first year after the Black Lives Matter protests — and the most recent year for which this data exists.
The overall job growth included 20,524 White workers. The other 302,570 jobs — or 94% of the headcount increase — went to people of color.
People of color make up a minority of the US population, and in most cases are underrepresented at big US companies. In 2021, Hispanic, Asian and Black people made up a vast majority of the added workers — a trend that, analysts say, is necessary to overcome their historic underrepresentation.
The biggest shifts happened in less-senior job categories. White people held fewer of those roles in 2021 than they did in 2020, whereas thousands of people of color were added to the ranks.
But the trend continued up the job ladder in top, high-paid jobs, too: Companies increased their racial diversity among executives, managers and professionals.
White people still hold a disproportionate share of the top, highly paid jobs in the US at S&P 100 companies. But the share of executive, managerial and professional roles held by people of color increased by about 2 percentage points compared with 2020 — more than double the average annual gains at big and mid-sized US companies in previous years.
The group of companies in our data set employs more than 9 million people in the US at some of the country’s largest and most lucrative firms, in industries from tech to finance, including Apple Inc., Walmart Inc. and Wells Fargo & Co.
The reasons for the changes are complex and may be unique to a specific moment in time. In 2021, companies were hiring lots of people while prioritizing diversity. Many have since cut jobs amid an economic slowdown just as a backlash to corporate diversity efforts grows.
While the biggest shifts in 2021 happened in lower-paying job categories, such as sales workers and admins, the trend also occurred in well-paid and powerful managerial and professional roles. Even at the executive level, more than half the added jobs went to workers of color.
Black workers, who were the initial focus of the diversity push, made some particularly notable gains. Their share of managers and professionals increased at 70 companies in our data set, and they boosted their ranks among executives in nearly as many firms.
But even such big one-time gains — and losses — represent a relatively small slice of the full picture. The share of executive, managerial and professional roles held by people of color increased by about 2 percentage points compared with 2020. That still leaves most companies in our dataset lopsided, with White people holding a disproportionate share of high-paying jobs at S&P 100 companies.
“Even if it doesn’t move the needle much overall, it shows something happened,” said Larcker. “If it has long-term impact, remains to be seen.”
The data currently available only goes through 2021 — comprehensive data for beyond then doesn’t exist yet — a year in which the US economy added a record number of jobs. Many laid off in the pandemic’s early days were people of color, who were rehired when demand bounced back. The Covid-induced remote-work boom helped some companies expand their footprints in more diverse parts of the country while shrinking in more homogenous communities. Retirements also surged that year, and older workers are more likely to be White.
At companies where overall employment shrank in 2021, White workers made up 68.5% of the losses, another 16.5% were Black, 9.7% were Hispanic and 2.3% were Asian.
The corporate reckoning on institutionalized racism in the immediate aftermath of Floyd’s murder by a White police officer was a factor, too.
That summer, some companies rebranded products that had long been marketed with racist stereotypes. More pledged hundreds of millions of dollars — and their shelf space — to racial equity efforts. Separately, about half the firms in the S&P 100, including Amazon.com Inc., PepsiCo Inc., Meta Platforms Inc. (then Facebook) and Microsoft Corp., set ambitious targets for increasing their share of people of color in leadership. Amazon set out to double Black vice presidents and directors; Microsoft pledged to double Black managers and senior leaders in the US by 2025.
The country’s shifting demographics were at play in the broader trend, said Elise Gould, a labor economist at the Economic Policy Institute, a think tank that studies policies for low- and middle-income workers. Many people just starting out in their career are from growing Black, Hispanic and Asian populations, who are entering the workforce just as more tenured White employees retire.
Even at companies that lost workers in 2021, such as Lowe’s and Home Depot Inc., people of color ended the year with a bigger share of the overall workforce. That signals that corporations are being mindful about not just cutting the most recently hired workers, who tend to be people of color, said Crystal Styron, a senior principal in Gartner’s DEI practice.