2. The benefits of a workforce diversity include better employee engagement, an overall improvement in capability, brand awareness, reducing groupthink and improving profitability.

3. To achieve a more diverse workforce think about your strategy, inclusive job descriptions, making your diversity more visible, and mitigating any biases in recruitment.

4. Implement strategies to retain a diverse workforce, once you have recruited them.

A diverse workforce can make the difference between success and failure in a challenging and unpredictable 21st century world. A diverse range of competent staff can help avoid narrow groupthink, broaden and sharpen team problem-solving capability, and create a more positive business brand. Recruitment isn’t the end of the story, however. Well-functioning corporate policies and management practices are needed to retain staff and ensure strong performance.

There is a robust evidence base for the benefits of workforce diversity and the advantages it can bring, especially for companies operating in the global marketplace. While diversity and inclusion policies are not new corporate concepts, there is still a long way to go in achieving their goals (e.g. diversifying boards).

Read on to find out more about the nature of workforce diversity, its advantages to business, and the action needed to make it a reality in your own teams and networks.

What is the definition of a diverse workforce?

A diverse workforce is a more heterogeneous workforce which brings together competent employees across different races, genders, social groups, physical abilities, communication styles, ages.

When considering workforce diversity in practice, one useful way to understand it is by thinking about three separate but overlapping subcategories:

Demographic diversity
This covers diversity of qualities such as race, gender, age, sexual orientation etc.

Experiential diversity
This category applies to diversity in areas including past work experience, outside hobbies and interests, cultures, innate abilities and training.

Cognitive diversity
This includes diversity of problem-solving approach, social attitudes, neurotypicality or neurodivergence, and so on.

What are the benefits of a diverse workforce?

Increasing the diversity of your workforce is a good business decision with numerous potential advantages. As well as increasing revenue, profit and productivity, workforce diversity can positively impact areas from employee engagement through to successful team problem-solving. Let’s take a look at some examples:

1. Increased revenue and profitability
A McKinsey study of 366 public companies found that the top quartile for ethnic diversity amongst managers were 35% more likely to achieve higher than average financial returns. The top quartile for gender diversity were 15% more likely to achieve higher than average returns. Other McKinsey research showed that businesses with more diverse boards were 43% more likely to earn more profits.

2. Increased staff engagement
The diverse workforce is more engaged, especially among millennials, 83% of whom are actively engaged when they feel they work for a company that prioritizes diversity and inclusion.

3. Less groupthink
Diversity helps reduce negative manifestations of groupthink, preventing stagnation of corporate culture and keeping an organization’s vision clear of limiting ideas and behaviors.

4. Improved capability and problem solving
A diverse workforce brings an expanded understanding of the range and nature of challenges facing your business. It also brings a greater variety of skills, past experience and solutions to address those challenges. Combining cultures, life experiences, and ways of thinking can lead to more creative and effective problem solving and decisions.

5. Boosted brand and business reputation
Diversity and inclusion can be particularly important for global companies who operate or hire internationally. In short, a diverse workforce is a key component of ‘global fluency‘. Clients, customers or potential employees may feel more positively towards organizations with a diverse workforce, particularly if their own nationality, race, language or culture are clearly reflected and valued.

Hire globally in 24 hours with Horizons PEO services.

How to recruit a diverse workforce

In order to attract the best employees across a diverse base, you should think carefully about job specification content. Where you advertise, how you advertise, and public perceptions of your business brand are equally important. At other stages of the recruiting funnel, such as the sifting and interview stages, fairness is paramount in order to avoid recruitment decisions influenced by inherent personal bias.

An experienced recruitment specialist could help you to identify, target and draw in a broader range of talent for your business, guiding you through the following areas.

1. Don’t include non-essential job criteria

Over-specifying job descriptions can lead to recruitment of candidates from a more limited and less diverse pool. Establish early which hiring criteria are truly essential for a role and remove extraneous specifications or language which could limit your pool of talent or put off otherwise well-qualified candidates.

For example, do you really need candidates with a specific degree from a top university, or could equivalent experience and high performance in that field be equally useful in demonstrating the necessary skills and competence?

Similarly, for graduate or entry-level positions which state “experience preferred”, can this be removed if training will be provided? Favoring candidates with experience from unpaid internships could mean hiring only from higher socio-economic groups.

2. Plan an inclusive advertising strategy

Newspapers, magazines or online platforms may have their own distinct demographic base in terms of gender, age, race etc. If you place an advert in only one or two locations, you could inadvertently limit recruitment to a narrower group of potential candidates than you intend.

To attract a more diverse selection of applicants, advertising across a wider range of relevant publications and media would be worthwhile. If you’re recruiting at entry-level across universities, target a broad range of institutions and faculties unless you genuinely require specialist expertise from one place.

3. Use inclusive language in recruitment documents

The language used in job adverts and recruitment documents makes a big difference to who might apply for a role. Certain words, phrases or writing styles may attract candidates of one type more than another or could turn off some groups of candidates entirely. Many transition words for argumentative essays will come in handy in delivering your message persuasively and can work in your favor whatever employment purpose you have when using those words.

Job adverts which use stereotypically masculine language have less appeal to women and can cause applications from women to drop by up to 10%. Similarly, single parents or careers might screen out jobs without flexible working provision, or disabled people might choose to eliminate job openings without mention of support for reasonable adjustments.

There are now several online tools available which can guide the wording of your job description to remove gender bias or generally use more inclusive language.

4. Make corporate diversity visible

Beyond the job advert, potential applicants are likely to take a view on the wider public brand of your business. If a job description talks about commitment to diversity but published data and imagery shows that almost all employees share the same characteristics, applicants may be deterred by this disparity.

Even worse, if past employees have resigned citing discrimination on grounds of race, gender or another characteristic, this could be strongly off-putting for those with the same characteristic, as well as anyone who values diversity (read more about equal opportunity laws at our Canada anti-discrimination guide and our UK equality law explainer). Any situation of this kind needs to be intelligently considered and effectively addressed to avoid deterring future recruits.

If you want applicants from a wide range of backgrounds to feel interested and engaged, corporate commitment to diversity must be visible in actions as well as words. Having a diversity policy, writing diversity into job adverts, or making symbolic or token appointments from under-represented groups, are all insufficient on their own.

Instead, diversity needs to be built into the organization and made apparent to the wider world through measures which could include:

Valuing, supporting and recognizing existing employees across diverse groups
See ‘Managing a Diverse Workforce’ below: This may boost employee engagement and performance and result in positive representation of your business within alumni or professional networks, or on employer review sites like glassdoor.com, any of which could influence future employees.

Operationalizing corporate diversity policy
Ensure that your diversity policy has a workable implementation plan, meaningful metrics and senior buy-in to prevent it from being ignored or sidelined. Make all managers responsible for workforce diversity metrics in their areas and don’t let it become a corporate bauble or box to tick.

Showing a diverse face to the world
Field a diverse range of employees for conferences, panel events and other representational engagements. This sends a loud and clear message to clients, competitors and the wider world that your business has many faces and favors competence over race, gender, age or other characteristics. Similarly, ensure a diversity of employees are featured in corporate imagery and publications.

5. Mitigate inherent bias in recruitment

We all possess an inherent bias towards people who look, sound and act as we do.

If inherent bias is ignored, organizations run the risk of perpetuating homogeneous, narrow-minded and stagnant corporate culture where board members, or senior managers, always select for new appointees of the same race, gender, age etc.. as existing seniors. We make better recruitment decisions when we recognize our inherent bias and take steps to mitigate it.

There are several strategies for minimizing inherent bias. One of the most important factors in this regard is diversity in the recruitment team. A more diverse group of interviewers could be better placed to identify strengths and weaknesses amongst a group of diverse candidates, and may also communicate with them more effectively.

Another aid to mitigating bias is to remove all identifying information from applications, including name, age and gender. Hiring managers can then focus more on relevant qualifications, experience and past performance when sifting and selecting for interview.

Yet another good practice is to implement a consistent interview structure for all candidates, ensuring that everyone is asked the same questions and given the same amount of time and support for their answers.

How to manage a diverse workforce

Recruitment is far from the end of the story in creating a well-functioning diverse workforce. For your business to benefit from this diversity, your employees must have equal employment opportunity, enabling workplace participation on a level playing field.

Effective management of a diverse workforce is vital, requiring board-level commitment and well-trained managers throughout the organization. Seniors should be willing to review and reshape an organization appropriately, including along the following lines.

1. Implement diversity-friendly corporate policies

Wider corporate policies should be compatible with workforce diversity and may need to be updated or expanded to create an environment where all employees can succeed and thrive. Particularly important areas might include those governing performance, pay and promotions, acceptable workplace behaviors and misconduct, or reasonable adjustment procedures for disabled staff.

2. Show strong leadership

Retaining and getting the best work from your diverse workforce requires effective management and direction. Leaders and managers must have the intelligence, understanding and flexibility to task and deliver across teams and networks whose members have multiple demographic characteristics, experiences, and ways of thinking or communicating.

3. Demonstrate fairness in performance recognition and reward

Recognition of staff performance and achievement makes a big difference to engagement and productivity. Organizations who recruit a diverse workforce but then mainly award bonuses and promotions to one group (e.g. those most similar to existing senior managers) could be failing at the last hurdle.

Ensure that promotion, pay and bonuses are matched to objective criteria and consider staff or client nominations where appropriate. Relying solely on manager recognition may result in disproportionate reward of those similar to managers.

Be aware of how various HR biases, such as proximity bias, can indirectly reduce the diversity of a workforce.

A final word…

Building a diverse workforce is desirable, achievable and good for business. Horizons is a global employment organization committed to a diverse workforce. If you’re thinking through some of the issues touched on this article or would like to work with us in any international location, please get in touch.

Frequently asked questions

What does a diverse workforce mean to a company?

It means recruiting and retaining employees that come from a range of demographic, cognitive and experiential backgrounds.

Why does a diverse workforce matter?

A diverse workforce matters as it is the best way to improve employee engagement, enhance company brand, avoid groupthink, improve overall capability, and ultimately, grow revenue.

What does a diverse workforce look like?

On a demographic level, a company with a diverse workforce will have employees of varied ethnic, linguistic and cultural backgrounds. It will also be disability-friendly.

Ideally it will also have workers of varied experience levels, and with different approaches to solving problems.