What happens in the tech industry doesn't stay in the tech industry. Businesses in the space have an outsized influence on the working world and therefore the potential to redefine workplace norms for the greater good — including expectations around DEI, according to a study from BeyondHQ.
The technology company, which focuses on workforce planning, measured diversity across more than 30 U.S. cities that host a technology workforce numbering at least 20,000, and shared its findings in a December 2021 report, Best Cities for Diversity in Tech Workforce.
It's a response to "recent social movements and demands for businesses across the country to do more to confront discrimination and promote representation," according to the firm.
Prospecting for diversity
To create a workforce plan for companies considering relocation or expansion to achieve a more diverse workforce, BHQ uses its own software based on a mathematical model, according to Rajeev Thakur, author of the report. Thakur leads workforce strategy and talent insight at BHQ. An urban planner and architect by training, Thakur helps companies around the world identify and vet their next location.
The company studies supply and demand, regional market performance and potential for profitability, taking into account diversity of talent and the cost and availability of real estate, among other things. These geographical economic surveys can make a business case for expansion, or withdrawal and consolidation elsewhere, Thakur told HR Dive.
These are hard decisions, sometimes based entirely on talent, and this is especially true for the tech sector, he said, where for the last three decades, most workplace initiatives have originated and been rapidly adopted into other industries — arguably bringing even greater significance to BHQ's Best Cities report.
With 15 years' experience surveying the business landscape, Thakur confidently illuminated a truism: Because tech is the "most dominant, least regulated" industry where wealth has been produced, what happens in the industry is deeply relevant and influential for countless others.
"If you have a group that is not represented well in tech, and most of the wealth is being produced in tech, then that group is losing out on all that prosperity."
Because tech is the most dominant, least regulated industry where wealth has been produced, what happens in the industry is deeply relevant and influential for countless others.
Head of Workforce Strategy and Talent Insight at BeyondHQ
Equitable representation can democratize technology
BeyondHQ is short for Beyond Headquarters, Thakur explained, because the implications of technology exist wherever people happen to be, and "[w]e think technology should be democratized."
The report analyzed several aspects of diversity: race/ethnicity, gender and age, but also representative diversity, which it defines as "how well a local demographic is represented in the tech industry." Raw diversity, it reads, is "the sheer size of the minority workforce, women and mature workers, weighted equally."
To understand representative diversity at work, ask yourself: Does the workplace look like the local population? Thakur offered a practical example: "If you find a lot of white professionals in the workplace in Boise, well, you would expect that because [it's] what the population is, so there's nothing egregious about that," but it's important to note, "83% of all tech leadership is still white male, [there's] an over representation of the Asian minority, and an underrepresentation of Blacks and Hispanics in tech."
This gets to the matter of distribution, a closely related dynamic of diversity, which asks: Does the workplace reflect socioeconomic balance among those who hold top and lower end positions? "Inclusion is more than just meeting your numbers, and saying 'Okay, now we are diverse,'" said Thakur, "It's also [about] the roles people play in an organization." Being underrepresented in the workplace "results in lower decision making power, lower [numbers in representation] and fewer role models. It has a chain reaction."
Certain demographic homogeneities persist in both low end tech jobs like user support and network support specialist, and 'front of house' roles like software developer where, Thakur said, the most money is earned. "I don't want to say there's a hierarchy in tech, but there is a hierarchy in tech."
Diversity does not guarantee inclusion, but companies can
Department heads of diversity, HR and corporate real estate may wonder if solving for diversity is as simple as setting up shop in cities with high minority populations. It's not, Thakur said.
He recalled a conversation with a diversity exec at a big tech company who relayed that cities with low populations of Black or Hispanic people were off the table. Thakur took advantage of that teachable moment, explaining that a certain demographic presence in a certain geographic region doesn't equate to available hires.
In the report, New York City represented the fifth largest tech workforce. It ranked near the top of the raw diversity scale, but near the bottom of the representative diversity scale.
The presence of minority groups in the NYC Metro area did not translate to a greater share of tech jobs held by minority groups. In fact, the NYC Metro area ranked far behind Salt Lake City, Denver and Madison; but Seattle and San Francisco are the only locations where experienced workers are underrepresented at an index of less than 0.85, according to the report.
Equal opportunity now means equitable representation later
Thakur said this all really comes down to a "build versus buy" decision. Maybe it's a question of values — which could be the answer, too.
"[Companies] can spend all their money on recruiting, and buy talent by paying people more than their competitors," but sometimes, available talent must be intentionally cultivated and diligently tended.
Thakur asked, "What are companies doing to create talent themselves?"
To be considered an employer of choice, Thakur said, companies can acknowledge that people come from different backgrounds and don't have the same opportunities, and embed [themselves] in those communities.
Addressing business leaders, Thakur reiterated: "Rather than waiting for universities to produce talent, catch talent early. Look at new models of education to create opportunities early in life," because, he said, "[inequities] start very early, back to homes and poverty and so on. Partner with schools. Train people. Have apprenticeships, so people can earn and learn."
A recent study of revenue at Fortune 500 companies examined profit per employee across various industries. Unsurprisingly, technology companies ranked highly, having generated an average profit of $77,961 per employee. "Employers have to design their organizations for inclusion," the BHQ report said, and numbers like these show that tech may be in a unique position to fund and achieve these goals.
BHQ is working to lead by example. The firm partners with communities to determine needed programming, helps to create those programs at the community college and university level, and then matches communities with companies.
But more can be done, Thakur said. State and local governments can create co-op programs with universities and "make [those programs] a feature, rather than a novelty in some corner of the United States."
Change resulting from those grassroots efforts may be neither immediate nor measurable, but companies that build talent are investing in diverse markets that will yield dividends, and future impacts that are inevitable.
Correction: An earlier version of this story incorrectly described BeyondHQ. BHQ is a technology company.