Diversity in the Workplace

Beginning in the late 1950s, people’s attitudes toward diversity in the workplace began to change. In 1960, the Americans with Disabilities Act (ADA) was signed into law. The ADA is a wide-ranging civil rights law that prohibits discrimination based on disability. In 1964, the Civil Rights Act was passed outlawing major forms of discrimination against racial, ethnic, national and religious minorities, and women. The Civil Rights Act of 1964 was designed to prevent discrimination in schools, public accommodations, and civil affairs, as well as the workplace. The US Equal Employment Opportunity Commission was established to enforce these acts and others.

As the world has become more diverse, worldwide workplaces reflect the demographic changes. Employers have moved beyond the equal opportunity efforts of several decades ago and have instituted training and programs designed not only to have a diverse workforce but to take advantage of the business opportunities that a diverse workforce can bring (McMahon, 2010).

Anne M. McMahon, a management professor at Youngstown State University’s Williamson College of Business Administration, authored a meta-analysis of research studies indicating that a diverse workplace can lead to increased business performance. She noted that diversity goes beyond demographics and includes workers' background and experience, as well as social and psychological factors such as attitude toward others, ability to work as a team, and accepting differences (McMahon, 2010).

Another study found that diverse work teams were more creative than homogenous teams because they brought different perspectives to the discussion (Leung, et al., 2008). A study of more than 130 companies in Ireland found diversity and equality management led to greater productivity, innovation, and less turnover (Armstrong, et al., 2010).

Diversity’s effects often depend on industry settings, particularly when it comes to working in teams. One study found positive effects in service-oriented workplaces and "slightly negative" effects in manufacturing settings. The service industries were characterized by more interaction with customers, and a store with a diverse staff was likely to attract a diverse clientele that could increase sales (Joshi & Roh, 2009). A study by a University of Illinois sociologist found that workforces made up of varying gender and races can lead to more sales revenue, customers, and profits (Herring, 2009).

Some say that gender diversity has been shown to have a positive effect on research and development. Studies indicate that interactive decisions, open debate, and improved social relations resulting from gender diversity could have a positive effect on innovation (Diaz-Garcia, et al., 2013).

However, diversity in the workforce is not without challenges. Differences in age and race can hamper communication and productivity among coworkers (Kirtulus, 2011).

A diverse workforce also can lead to a diversity of opinions and can lead to friction. In some instances, employees may also perceive that some promotions or hires were offered to less qualified candidates in an effort to maintain a diverse workforce. When a company moves to diversify, the current employees may feel "an erosion of power" because of the newcomers (Armache, 2012).

If diversity is not well managed in an organization, several studies show that employee turnover or absenteeism can result. Team members who are different in sex, age, and race are sometimes not as committed to one another (Voustas, 2011).

McMahon’s studies found that when diversity enhances business resources, capabilities, and core competencies, it is more likely to lead to high performance. When it does not, its effects are less powerful (McMahon, 2010).

Only time and additional research will tell whether these are real or perceived benefits. In the meantime, you may want to consider the following questions: