Diversity Equity & Inclusion is critical in a recession and isn’t a ‘nice to have’

diverse meeting with a whiteboard

Ritu Mohanka MD of EMEA at Syndio explains why recessions force DE&I initiatives to the top of the priority list.

In the midst of economic maelstroms and a cost-of-living crisis, businesses and employees alike are understandably anxious about the ever-present big picture issues. This pressure is increasingly compelling business leaders to weed out what some deem to be ‘non-essential’ initiatives to minimise expenses, cautiously evaluating where to best allocate resources.

Not sidelining Diversity, Equity & Inclusion (DE&I) now may seem counter-intuitive. In fact, in a time of economic turmoil, there is an even more urgent need to invest in DE&I efforts. Far too often, DE&I suffers as a ‘nice to have’ initiative, viewed as something to invest in when times are good.

It comes down to this: recessions are not created equally. The data shows us that there are groups who are impacted more than others, and existing biases and inequalities can quickly become more ingrained and increasingly painful in times of crisis.

Recessions aren’t created equally

Historically, studies noted that ethnic minority unemployment rates rise faster than others during a recession or time of economic uncertainty.  During the COVID-19 crisis,  Black African/Caribbean people fared worst among all groups, with unemployment rates reaching 13.8%. By comparison, the White unemployment rate has not reached that level since the early 1990s, and was 4.5% in the same period.

The same trend applies to pay rises and promotions. Recent research in response to the current economic climate found working professionals from ethnically diverse backgrounds are nearly twice as likely to have been told they won’t be getting a promised pay rise this year. Whether organisations are conscious or not, it’s evident that when times get tough, it is ethnic minorities bearing the brunt of budget cuts and redundancies, exacerbating existing pay and opportunity inequities.

This is also perpetuated by the lack of ethnic minority representation in top leadership roles, which remained stagnant at a disappointing 3.7% with only one additional ethnic minority leader added since 2014. A lack of ethnic minorities sitting securely in top leadership roles directly translates to the majority of workers further down the hierarchy earning less, with less job security and fewer advocates at the top to ensure there is space and paths for progression.

How can you support your employees?

The cost-of-living crisis is hurting everyone, but it’s irresponsible of business leaders to not acknowledge those who might be feeling the pain more than others. The best way for them to pre-empt and assess where these inequities may appear – especially before taking further responsive action to the crisis – is to scrutinise existing workplace equity data.

Take tangible action – use pay gap reporting based on your own company data to make strong decisions. Are certain groups being disadvantaged? Paid inequitably? Not being awarded promotions or hired? Why and what can you do next to rectify this?

This information can be leveraged to rectify salary discrepancies, fix promotion pathways and offer pay rises where needed. It can also be a helpful starting point for businesses to scrutinise their recruitment processes – where can you prioritise existing staff rather than advertising externally?

Any effort to improve your workplace equity demonstrates a company culture of care which, in turn, employers must ensure they  communicate back on, offering reassurance and fostering a positive team attitude during a time of real concern and anxiety.

We would all love to snap our fingers and achieve the diverse, equitable, and inclusive workplaces of our dreams. But the truth is that most organisations have a lot of work to do to define what that means, and then progress will be incremental. Years — or even decades — of biased decisions, systemic inequities, and a lack of diverse representation in decision-making roles create inequitable policies and practices.

And these, in turn, influence who gets hired, advanced, and retained, as well as how they are compensated. All of this means that DE&I is a journey — and one with no single destination. Once you “achieve” diverse representation, equitable practices, and an inclusive culture, you have to sustain them. This is why workplace equity is so critical.

Taking the ‘AND’ rather than an ‘OR’ approach

Recessionary times are a crucial opportunity to both reflect on and prioritise meaningful workplace equity action. DE&I is an ongoing longer term effort, we cannot just press pause. And in a time of economic hardship, it’s not only the right thing to do, but the best thing you can do.

After all, ensuring that employees are paid equitably for the work they do is the most economical move we can make during a time of financial uncertainty – paying workers for the work they do – no more, no less.

When it comes to DE&I initiatives, we simply cannot be complacent.

Ritu MohankaAbout the author

Ritu Mohanka is Syndio’s Managing Director and Head of its EMEA business. Ritu is passionate about making workplaces more diverse, inclusive and fair. Mohanka joins Syndio with over 20 years’ experience in senior leadership roles with HR and talent-focused businesses, including leading business development and strategic growth efforts in EMEA at Glint (now LinkedIn). Prior to Glint, Mohanka worked at Kenexa/IBM Smarter Workforce to drive rapid revenue growth across the EMEA region. At both of these leading Talent and Employee Engagement players, Mohanka was instrumental in driving rapid growth across EMEA, deepening existing markets and expanding into new markets. Mohanka is the winner of multiple awards and has been recognised on the EMpower Top 100 Ethnic Minority Senior Executive lists on several occasions.

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