Disappearing Diversity Programs As DEIB Is Caught in Political and Economic Crossfire

The growing political divide in the United States is calling many established norms into question—in our personal lives as well as at work. After a swell in awareness, interest, and commitment following the murder of George Floyd in the summer of 2020 and the rise of the Black Lives Matter movement, corporate diversity efforts face backlash, budget cuts, and legal challenges as HR departments attempt to deal with an even more challenging political and economic environment. Many diversity, equity, inclusion, and belonging programs (DEIB), once considered indispensable to the modern workplace, are now on the chopping block as diversity program executive positions increasingly disappear. What’s going on and can DEIB efforts be saved?

DEIB initiatives fall victim to sweeping budget cuts

In recent “post-pandemic rightsizing” efforts, organizations are cutting expenses. From tech to healthcare, many large companies have had to slash their workforce, and programs seen as non-essential such as DEIB have been the first to go. 

According to the Visier 2024 Trends Report, even less controversial initiatives such as trying to reduce the gender wage gap are now under attack. After decreasing for five straight years, the male-to-female gender pay gap increased in 2022. And, for women of color, the gap opened wider. In 2023 SCOTUS overturned affirmative action in college admissions—a move that is almost certain to transfer to corporate settings. Clearly, there is more work to be done.

Considered “woke” and unnecessary by business leaders such as Elon Musk and Mark Zuckerberg, diversity programs were the first to be eliminated at Tesla, Twitter, and Meta. Tesla axed support programs for LGBTQ employees. At Meta, Zuckerberg’s “year of expediency” meant that people considered non-essential in marketing, corporate communications, and recruiting were let go. 

"Last year was a humbling wake-up call. The world economy changed, competitive pressures grew, and our growth slowed considerably,” says Zuckerberg in a statement. In January, Microsoft and Google followed suit, with dramatic cuts to diversity programs. Among the tech behemoths, only Apple (with a strong commitment to DEIB as well as its corollary, sustainability), managed to avoid mass layoffs. 

Short-term planning left diversity leaders out in the cold

In all fairness, many prior DEIB programs weren't well thought out to begin with. They were under-resourced and even when money was earmarked, they didn't necessarily have the executive buy-in needed to be successful. It may be that many of these HR leaders were set up for failure. When DEIB was in vogue, a new position, the Chief Diversity Officer (CDO) was established. It seemed at last diversity would have a seat at the executive table. CDO positions which grew by 168.9% from 2019 to 2022 are now being cut and programs defunded—as the Wall Street Journal reports, there has been a 75% decline in CDO searches this year. 

It took just a year for CDOs at major companies to be fired or to quit out of a sense of burnout and lack of support. In a liberal political climate, companies went out of their way to signal virtue in the short term while neglecting long-term concerns and the need to remain profitable.

By over-indexing on DEIB hires it was only natural that, following the last-in-first-out approach, many of these HR hires would be laid off. It didn’t have to be this way. Had there been more in the way of organization support, investment, and accountability, diversity programs could have proven their importance much earlier. 

It may be time to try again, this time with an understanding of what changes need to occur. “In many cases, there were unrealistic expectations placed on those running DEI programs, says Susan McPherson, CEO at McPherson Strategies, a social impact strategy firm in NYC whose clients don’t flinch at being considered “woke.” She identifies four major things that sunk DEI after the summer of 2020 (bad timing might be another).

1. Not enough resources

2. A lack of executive support and funding

3. Assuming DEI programs are a one-and-done process, rather than an ongoing organizational commitment

4. Constant pressure from leadership to meet numbers rather than focusing on the human element of equity and inclusion

Making DEIB work in today's business climate is less about filling a quota and more about having a way of measuring the success of DEIB efforts. Companies should consider a bonus structure tied to talent outcomes, similar to the way they now reward their salesforce. If you can prove that DEIB can boost team dynamics, improve productivity, and foster innovation, even the most adverse people may begin to see its value.

Diversity programs must integrate with the business for success

Diversity programs should not and cannot function in a silo. Instead of merely establishing diversity quotas, DEIB should be woven through the fabric of an organization to eliminate bias and discrimination at all levels. As most savvy talent acquisition leaders know,  DEI goals can’t be accomplished through hiring alone. It's important to nurture an inclusive workforce, no matter where an employee may be in their career journey. That's where the belonging part comes in. 

To attract a more diverse workforce, companies need to make systemic changes throughout the organization. Changes such as improved accessibility for the differently abled that go beyond what is required by the law—just adding a wheelchair ramp is only the beginning. It’s about making sure that all of your workers’ individual needs are met so they feel part of the team. And don't forget the impact on your other employees. They may feel threatened by things they don't understand and need to see that everyone in your company is in it together and aligned toward a common goal. HR should also consider cultural programming so that employees can celebrate their differences together. Think about what you can do to make everyone you employ more welcome.

Furthermore, whatever you do should be based on actual data. With tools like Visier People® Workplace Dynamics HR departments and managers can not only analyze historical data but can monitor the pulse of an organization in real-time.

It's true that DEI initiatives no longer automatically get a green light but they may emerge stronger as a result. When forced to justify their efforts in the face of budget cuts and legal challenges, HR departments must have a better plan in place. Prioritizing DEI can lead to better business outcomes—and a healthier workplace for all.

Read more about creating resilient diversity programs in the 2024 Workplace Trends Report: 10 New Rules for HR: Anchor DEI to Business Outcomes For Maximum Success