3 Meaningful Steps to Increasing Hiring Diversity for SMBs

by Caitlin Trent

The terms “diversity,”“equity,” and “inclusion,” or all three strung together in the acronym, “DEI” are popular buzzwords right now in the workplace.  Especially since the racial reckoning that started in 2020 after George Floyd’s murder and the pandemic that brought systemic inequities to the forefront, more and more mainstream companies are scrambling to either address the lack of diversity in their workforce, or make it look like they are. Corporate America, do we still have a workforce diversity problem? 

While many white Americans think there’s too much of a focus on talk about race, the facts are clear that diversity in the workplace is a problem. Representative Joyce Beatty of Ohio wrote, “Right now, there are only 33 women Fortune 500 CEOs. That equates to an embarrassingly low 6.6 percent. Worse still, Mary Winston is the ONLY CEO woman of color, and she is merely serving in an interim post. If you don’t include Winston, there is an abysmal four black Fortune 500 CEOs and a paltry 11 Latino Fortune 500 CEOs. Yet, the lack of diversity and inclusion doesn’t end there.” In sum, as of 2020, 90% of Fortune 500 CEOs were still white males

Meanwhile, an analysis by Coqual (formally Center for Talent Innovation) of specifically Black Americans in US companies found that although 12.5% of the US population is Black, only 3.2% of senior leadership positions (not just the elite Fortune 500 leadership positions) are held by Black people.

So, yes, there is a problem...and it’s not just with racial diversity. Across the U.S., companies need to make real strides towards fair hiring across diverse genders, sexual identities, neurodivergence, disabilities, cultures, and many more experiences that make up the tapestry of the workforce.  

How does a company really address, rather than perpetuate, this problem? 

CEOs of companies have made diversity pledges, rolled out Black Lives Matter advertising and attempted to appeal to masses of consumers that they are, in fact, doing something. This isn’t the first time: in 2014-2015 Silicon Valley companies-- Google, Facebook, Apple-- made similar rounds of pledges, and none of the marketing schemes alone have gotten them there

Despite the challenges--and aside from policy reforms and broader cultural shifts--companies can and must shift workforce diversity if they want to take inequality seriously. Small businesses are in a unique position to do this; here are three ways. 

Look Diversity in the Face

Making a public slogan may be a great PR choice, but it’s not real DEI. A company will be unable to increase its workforce diversity if they haven’t analyzed their particular workspace first.  They must take stock of what patterns exist at their specific business to begin the process in earnest.  Companies need metrics, such as who they’ve hired over the years, who has been promoted, and who has left the company. 

This process should try to be as in-depth as possible. If a company has managed to hire 15% Black workforce, they may think they’re doing well. But, if all of their Black employees leave the company at higher rates than their white hired counterparts, there’s still an issue to address. The same can be said of other kinds of diversity hiring: does the company chase out neurodiverse employees? Disabled employees? Employees of different ages or cultural backgrounds?


If a company doesn’t have metrics to use, they need to implement them in their Key Performance Indicators (KPIs). As HR Daily Advisor states, “By measuring the organization’s diversity and looking at it objectively, it helps to improve the overall diversity levels by putting more focus on the actions required to improve them.”  If KPIs reflect what a company finds important to its business health and success, diversity workforce metrics should be included in its indicators. The only way to take this step is to deal with it head-on--recognizing honestly where the company may be engaging discriminatory hiring, retention, or workplace practices. 

Take Criticism, Feedback and Learning Seriously

No one likes to hear that they are doing the wrong thing.  Hearing uncomfortable criticism however, is the first step in addressing any issue.  Criticisms can come internally from employees and may be facilitated by an expert to protect employees in this process. Leadership must take the necessary steps to learn and understand systemic diversity issues in their workplace culture. 

Each workplace is unique, so who best to help understand why a company is struggling with diversity than its employees?  This however, should be done intentionally and, ideally, with a third party DEI expert that can help employers identify what is happening, while removing any fear of intimidation or retaliation from the employee. 

For instance, a scenario where a white, cisgender male boss expects a Black, gender non-conforming employee to answer questions like “Working here is fine, right? We don’t make you uncomfortable, do we?” may put this employee in a compromising or even unsafe situation. It’s tokenizing, disrespectful, and threatening, and a consultant can help mediate these dynamics instead. Employers should strive to honor both the autonomy and safety of their employees while seeking answers to their questions about workplace safety and diversity.  

All feedback should be anonymous, and all employee-employer, supervisor-supervisee relationships should be considered in the information collection and analysis stages of a DEI assessment.  If the workplace is dominantly non-diverse, then seeking answers externally is a better option. In this case, employers should strive to understand what they are doing to prevent diverse prospects from applying or accepting roles at their company.

Externally, leadership should prioritize their own learning.  This work is for everyone, and the burden of teaching must never be expected of or exclusively on the “diverse” employees: do the work. Read, listen, and engage in conversations on workplace diversity outside of the business. Come from a place of wanting to understand, rather than trying to check a box. Seek to understand abusive power dynamics, and commit to change them. Plenty of resources exist, such as the Society for Human Resource Managements’ explanation of barriers for Black professionals, or Coqual’s analysis on Being Black in Corporate America. Similar tools exist for DEI training across other experiences too. 

Analyze and Change Recruiting Practices and Hiring Processes 

Once a pattern has been identified for where a company is lacking in DEI and anti-oppression practices, then the company’s culture and procedures can be taken into consideration. Companies should examine their job descriptions and requirements with a lens of inclusion and equity, and overlap that with the data they found in the first two steps.  

A common example is higher education requirements: with the cost of higher-education having become so inflated alongside the growth of crippling student debt that disproportionately affects people of color, requiring a 4-year or a Masters degree can be prohibitive and inherently discriminatory in ways that favor white or wealthy sectors of society.  Some jobs may need a degree as a qualification, such as a role in chemical engineering. However, companies must analyze each role to determine if this requirement is truly necessary for job performance. Are there more applicable skill sets that can be demonstrated beyond holding a degree? Too many job descriptions default to discriminatory societal norms without really questioning what skills and characteristics their ideal candidate would have and how they can demonstrate them beyond these norms. 

Recruiting practices also need to be taken into account.  Forbes describes how typical recruiting practices can lead to less diversity: “When a whopping 80% of jobs are never posted online but filled through referral or internal hires, your current employees play a large role in who gets hired next.”  So, if the workforce is white, it is likely that their referrals will also be white. This is especially true in context of a Pew Research Center study that found 75% of white people have no friends outside of their racial group. Significant research also demonstrates the ways other kinds of biases manifest in hiring practices, such as non-white sounding names on resumes impacting hiring decisions. Companies must work to resolve these kinds of issues at all levels of recruitment, hiring, interviewing, onboarding, and work culture.

Another example of a way to change recruiting practices for diversity is to consider location. In the digital age, post-COVID, companies should be evaluating if their candidate must live in the area to be in an office, or if they can be hired to work remotely.  Offering remote work opportunities not only expands the geographical arena for more diverse candidate recruitment, but it also allows for more flexibility and different kinds of people to be able to apply and work from home. If companies engage this option, they must make sure that their work culture matches this recruiting effort: have they provided diverse, remote employees with the right tools for success?

Beyond job descriptions and recruitment processes, companies must also consider screening procedures. For example, there should not be a blanket screening policy where someone with a criminal background is automatically denied employment. Not only is this illegal in some contexts, but it is a discriminatory practice. Systemic racism within the judicial system is reflected in criminal background checks, and if companies are serious about diversity, they will determine in their hiring practices what is or isn’t problematic for specific roles. Knowing when to overlook a criminal background will help businesses make unbiased decisions after criminal background checks are conducted. Screening procedures should take account of other kinds of diversity issues, like whether or not an application or online interview process properly enables disabled individuals to submit their qualifications for the role. 

Not Just for Diversity's Sake - Diversity Benefits Companies 

According to McKinsey management consulting firm that conducted an in-depth analysis on the correlation between profits and diversity, “Companies in the top-quartile for gender diversity on executive teams were 21% more likely to outperform on profitability and 27% more likely to have superior value creation. The highest-performing companies on both profitability and diversity had more women in line (i.e., typically revenue-generating) roles than in staff roles on their executive teams...Companies in the top-quartile for ethnic/cultural diversity on executive teams were 33% more likely to have industry-leading profitability. That this relationship continues to be strong suggests that inclusion of highly diverse individuals – and the myriad ways in which diversity exists beyond gender (e.g., LGBTQ+, age/generation, international experience) – can be a key differentiator among companies.”  

Everyone--from the CEO to the lowest paid employee--must take the necessary steps to make anti-oppression and DEI part of their workplace practice. Recruitment and hiring are just the first steps. Once a diverse staff has been recruited, maintaining that staff will also take work. Well beyond performative demonstrations of DEI, employers who take these issues seriously in the earliest, most detailed stages of hiring will be better prepared to have a safe, healthy workplace culture overall.

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