Changing demographics will require changing the way we do business

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  • 2008 Wiley Periodicals, Inc.Published online in Wiley InterScience (www.interscience.wiley.com). DOI 10.1002/ert.20218

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    Changing Demographics Will Require Changing the Way We Do Business

    Lynn Lieber

    Changing demographics and the growing recognition that diver-sity is crucial to organizational success has changed the view ofdiversity programsfrom vehicles for social responsibility tobusiness necessities. As shifting demographics today lead to adramatically different working population in the future, organiza-tions must take the necessary steps to create inclusive, diverseworkplaces. Those that ignore these changes are potentially crip-pling the organization down the road.

    WHAT DO DEMOGRAPHIC CHANGES HAVE TO DO WITHBUSINESS?

    Conducting business as usual does not work when the world ischanging. Burgeoning population growth, migration, and dra-matic changes in the racial, ethnic, and age makeup of countriesmean drastic changes ahead for the workplace. These demo-graphic shifts will change not only the composition of the future workforce, but also the roles and responsibilities of theexisting workforce. They will also affect the needs of businesspartners, clients, and customers. The way an organization posi-tions itself now will help shape its ability to adjust to thesechanges.

    WHAT SHIFTS IN DEMOGRAPHICS WILL BE SEEN IN THE NEXT FEW YEARS?

    In the next ten years, organizations can expect enormous changesin the population that will affect the incoming workforce and theclients and customers to whom they market products and ser-vices. In an increasingly global economy, many organizations arealready recognizing the need to appeal to a broader audience.

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    However, many do not realize that this broader audience is increasinglycloser to home.

    As population growth explodes, migration will become an important con-cern. The United States, which currently receives over one million immi-grants per year, will increasingly need to appeal to a foreign-born audiencefor both marketing and employment purposes. Immigration also alters acountrys existing racial and ethnic composition, affecting the culture. Savvyorganizations are alert to such changes and adapt to them.

    In 2050, the United States is expected to become a minority-majoritycountry, meaning the number of minority people, taken together, will exceedthe number of nonminority residents. Changes within specific racial andethnic populations are also occurring. For example, in 1970 only 1.3 percentof the U.S. black population was born outside of the United States; in 2000,that number jumped to nearly 8 percent. Organizations without strongdiversity initiatives in place will have a difficult time attracting an increas-ingly diverse workforce.

    The workforce is also getting older. In Europe, the number of people 65years of age or older is expected to rise more than 50 percent between 2005and 2030, putting strain on the pension system as well as businesses. In theUnited States, as baby boomers retire, high-level positions will open in orga-nizations, and many employees will move up. As a result, organizations willbe looking to fill a large number of vacancies at lower levels with migratingworkers and younger workers. Organizations will also face new demandsfrom these employees, many of whom will be caring for both their childrenand their aging parents.

    Changes in the age of employees will also affect other aspects of diversity,such as race and gender. For example, in the United States, racial diversity ishigher among younger age groups. As older workers leave and youngerworkers join the organization, the racial composition of the workforce willbe altered. Also, because women outlive men, the aging populationwhichis working longerwill include more women than men, and the more expe-rienced workforce will become increasingly female.

    Organizations that have not achieved equality within management willhave a difficult time attracting experienced workers. Without strong manage-ment in place, problems will trickle down through the organization.

    WHY DO ORGANIZATIONS NEED TO ADAPT TO DEMOGRAPHIC CHANGES NOW?

    Timing is a key issue in diversity initiatives. Some organizations feel there isplenty of time to adapt to the impending demographic changes, but this sim-ply isnt true. Creating a diverse organization takes time and concentrated

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    effort over many years. Organizations that wait for the demographics tochange before altering diversity practices will already be falling behind.

    If organizations do not begin recruitment and retention efforts focused ondiverse groups now, then ten years from now, these organizations will nothave a diverse management. Organizations that do not reflect the diverselabor pool will find it increasingly difficult to attract experienced workers,who will be significantly more diverse. Forward-thinking organizations needto consider the substantial demographic changes approaching and prepare tochange the way they do business. They must start the process of workingtoward inclusion today so that they are in a position to recruit top candi-dates in the future.

    WHAT CHANGES DO ORGANIZATIONS NEED TO MAKE TO THE EXISTING CULTURE?

    As global demographics change, inclusive workplaces will be in even higherdemand. Organizations hoping to recruit and retain diverse employees willneed to put into place a culture of respect and inclusion that begins with theexisting workforce. Organizational diversity will be instrumental in recruit-ment efforts as the percentage of minority and female job applicantsincreases. These groups, who have faced employment bias historically, areexpected to increasingly seek and value inclusive environments.

    Diversity programs are most likely to succeed if they have the support ofexisting management and are properly communicated to existing employees.Explaining the importance of diversity from an organizational perspectiveand clarifying the role managers will play in diversity initiativeshelpsensure that all upper-level employees understand the organizations commit-ment to diversity and can convey it to subordinates. Diversity is not aboutalienating current employees; its about increasing opportunities and maxi-mizing resources.

    It is also essential that managers understand how the organization definesdiversity. Many individuals have a limited understanding of the componentsof diversity, viewing it as simply a matter of including members of groupstraditionally protected by law. However, true diversity goes much further,and encompasses all of the differences among people. By valuing the differ-ent experiences and principles diverse employees bring with them, an orga-nization can reap the benefits of a diverse set of ideas, skills, and talents.

    HOW DO ORGANIZATIONS RECRUIT DIVERSE EMPLOYEES?

    Harnessing the power of a diverse workforce starts with recruitment. Thefirst step in recruiting a diverse workforce is having an organizational cul-ture that respects and values diversity and promotes a positive environment.

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    Job-seeking behavior varies among different groups, so it is important not totailor recruitment efforts too narrowly. Local recruitment services that donot have a national or international audience automatically limit recruitmentefforts, as do job postings that focus on particular networks. Broadeningrecruitment efforts to services with larger audiences or using more thansimple job postings to search for candidates are effective methods forincreasing the diversity of applicants.

    Although some groups are historically more likely to rely on networkingvia community groups and organizations, others utilize referrals at higherrates, and still others use career centers or Web postings. Organizations thattap into all of these resources are likely to find a range of qualified appli-cants.

    WHY IS THE INTERVIEW PROCESS CRUCIAL IN THE SEARCH FORDIVERSITY?

    Once candidates have been successfully recruited, it is critical that they notbe lost due to misunderstandings during the initial employment screeningstages. This means those involved in the interview process should be trainedto identify and understand cultural differences. They should also know thatrecruiting diverse candidates does not mean lowering standards. However,interviewers must have an accurate understanding of how to evaluate theopen position and the experience of the candidates.

    Organizations should be aware of the varying importance different cul-tures place on education versus work experience and the breadth versus thedepth of related experience. In some cultures, it is expected that applicantsinclude information about age, marital status, and number of children,whereas other cultures may find this unusual. There can also be vastly dif-ferent expectations for listing accomplishments and educational achieve-ments depending on the cultural background of the applicant. Misunder-standings about what certain candidates may stress in cover letters can leadto ignoring candidates who are not only qualified for the position, but alsopossess diverse skill sets.

    Furthermore, assumptions about job-hopping tendencies can be mislead-ing when reviewing applications from immigrants. It is common for immi-grants to have intermittent employment as a result of the obstacles they facein establishing themselves in a new location. So long as this pattern does notextend far beyond the time surrounding immigration, it is not usually anindication of the long-term prospects of the candidate.

    Bias and cultural misunderstandings can extend past the initial cover let-ter and rsum and into the interview itself. For certain groups (includingnonnative language speakers and people who are deaf or hard of hearing),

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    phone interviews can be a disadvantage and are often not indicative of thequality of the applicant. In-person interviews allow these individuals to seethe body language and expressions of the interviewer and can make a bigdifference in the success of the interview.

    Cultural differences, such as eye contact and appropriate conversationaltopics, can all affect the way an interviewer perceives a candidateand howthe candidate perceives the interview. Candidates with cultural differencesfrom the interviewer may feel the interview is not progressing well and,therefore, not give a good interview. Multicultural interviewing teams orinterviewing teams who have undergone diversity training can help avoidthese problems.

    HOW DO ORGANIZATIONS RETAIN DIVERSE EMPLOYEES?

    A successful plan to bring diverse candidates on board must include an eval-uation of the workplace to ensure that the environment is positive andinclusive enough to retain the new hires. Organizations that do not have apositive work environment risk losing employees; 32 percent of people ofcolor and 18.5 percent of white women report they would have remained ata job had the work environment been more positive. If the members of adiverse workforce do not feel valued or face stereotypes, discrimination, orfewer opportunities, they are more likely to seek an organization withstronger diversity awareness.

    The point of diversity initiatives is to develop an organization that canmaximize the strengths and skill sets offered by a diverse group of workerswhile accommodating different needs and values. For example, creating abenefits package that can appeal to a broad range of workers and their fami-lies, as well as offering flexibility with regard to work schedules and timeoff, are important in attracting and retaining diverse employees.

    WHAT TRAINING WILL PREPARE ORGANIZATIONS FOR FUTUREDEMOGRAPHIC SHIFTS?

    Organizations that want to be prepared for future demographic shifts needto ensure that both existing and incoming employees receive training on theorganizations diversity initiatives. Diversity programs will be effective onlyif all employees know the organizations stand on diversity and understandhow it affects them.

    Diversity training should stress the organizations commitment to creatinga workplace of respect and inclusion for all employees, clients, customers,and business partners. Training should go beyond simple antiharassmentpolicies and teach employees how to work effectively with others who may

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    have vastly different ideas on group versus individual work, concepts oftime, and methods of communication.

    Training for management needs to focus not only on how to convey theorganizations commitment to diversity, but also on how to manage a diversegroup. Managers who receive proper training on diversity can harness dif-ferences in a way that enhances creativity and opens the organization up tonew ideas and possibilities. Those who do not may find their teams gettingmired in differences.

    It is critically important that organizations develop a commitment todiversity now, so that coming demographic changes dont leave them fallingbehind the competition. Organizations with strong diversity initiatives andthe training to back them up will be well prepared to face the demographicchanges of the future.

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    Lynn D. Lieber, Esq., is founder and CEO of Workplace Answers, a San Francisco-based provider of Web-based legal compliance training.Lieber is a seasoned employment law attorney and a nationally recog-nized spokeswoman on harassment and discrimination law. WorkplaceAnswers delivers Web-based training in human resources, unlawfulharassment prevention, and financial and ethics compliance. The com-pany helps client organizations to build an effective affirmative defenseunder local, state, and federal employment law. She may be contacted viae-mail at lynn.lieber@workplaceanswers.com.