The data on the current wave of tech layoffs are too sparse to draw firm conclusions, but an analysis of publicly available data by workforce intelligence platform Revelio Labs raises red flags: It found that between September and December 2022, women and Latino employees represented 46.64% and 11.49% of tech layoffs, despite the fact that they comprise 39.09% and 9.96% of that industry, respectively.
One of the most common explanations is that many companies use a “last in, first out” approach, where recently hired employees are the most likely to get cut—and for companies without strong DEI structures in place, employees from underrepresented groups are less likely to be among the longest tenured.
But tenure isn’t the only problem. Diversity within organizations isn’t always evenly distributed, and women and minority employees tend to be more represented in support functions that are more susceptible to job cuts. Research by sociologist Alexandra Kalev found that when companies focus managerial cuts on position and tenure, layoffs disproportionately impact underrepresented groups, because managers from underrepresented groups tend to be more junior and work in areas like HR and PR, which “aren’t usually perceived as core to the business,” wrote Kalev in the Harvard Business Review.
Finally, DEI might not be a priority for a company during layoffs, which are typically a financial exercise, says Donald Knight, CPO of the HR software platform Greenhouse. And “in the absence of social issues forcing the conversation around inclusion, diversity, equity, and allyship—similar to what we saw around George Floyd or some of the other things we saw play out on the main stage—it becomes easier for companies to revert back to their default habits and behaviors,” says Knight.
Letting DEI fall by the wayside during a reduction in force can further exacerbate the negative effects of job cuts. It might make recruitment more challenging if applicants from different backgrounds don’t see employees who look like them, says Alex Noether, an expert associate partner at Bain & Company who advises companies on DEI issues. “You may lose even more people [to voluntary turnover] because they start to distrust the organization, [or] feel a lowered sense of belonging,” he adds.
There are many downsides to a layoff, but having it undermine your DEI strategy doesn’t have to be one of them. If you must conduct layoffs, here are two steps to at least make sure they're done equitably.
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