Labor Market Data and Workforce DEI
The collection, integration, and application of employee, organizational, and financial data — collectively known as people analytics — is an increasingly common tool in strategic workforce management. In addition to driving more informed decisions in several areas, such as recruiting, engagement, retention, and human capital investments, people analytics can identify, and quantify the results of diversity, equity, and inclusion (DEI) initiatives — a growing need in today’s talent market.
People analytics and DEI
Many companies have publicly expressed a commitment to improving workforce DEI policies, but the best intentions won’t produce results without a practical, comprehensive, and data-driven strategy to bring them to fruition. People analytics can ensure your company’s DEI initiatives are backed by data that illuminate any issues you need to address, so you can drive change, and improve your DEI approach, with transparency linked to specific success metrics.
Data-driven DEI begins with an honest assessment of the hard numbers in three broad categories: representation, compensation, and performance. Consider the following:
Representation. Look further than blanket representation numbers for race, gender, age, disability, and other demographic categories. For more precise data on representation, use people analytics to assess the demographic diversity of your staff across locations — in all departments, on each team, and at every leadership level.
Compensation. Payroll data provides information on the total value of an employee’s compensation, including salary or wages, benefits, bonuses, commissions, and/or stock options. Total compensation is a critical metric for evaluating the equity of your company’s compensation strategy across demographic groups.
Performance. Performance data affects an employee’s internal mobility prospects and informs decisions about career development, compensation increases, and advancement opportunities. Compare data across demographic categories to determine if bias — unconscious or otherwise — affects performance scores.
People analytics allows a company to examine the impact of internal policies and hiring practices to determine whether its present strategies perpetuate bias and, if so, pinpoint where improvements are needed and develop precise metrics for tracking progress.
DEI data points
A comprehensive DEI policy is increasingly essential in a competitive talent market. Successful initiatives will continue to drive recruitment, employee engagement, performance, productivity, retention, and profitability in 2023.
And while data alone can’t guarantee DEI success, it does provide a solid foundation on which to build. People analytics provides insight into a range of DEI-related metrics — including demographic diversity, pay equity, and inclusive workforce management policies — to help identify areas for action, including:
Diversity gaps. Areas to measure include racial, gender, and ethnic diversity of staff at all levels; retention, promotion, and attrition rates of underrepresented groups; and the rates at which underrepresented applicants are actively recruited, interviewed, and/or hired.
Benchmarks. Common benchmarks include competitor performance, U.S. Department of Labor and Census Bureau statistics, and college and graduate school graduation rates among various groups. Inform your DEI recruiting strategies with labor market supply benchmarks at the local geographic level.
Specific goals. Use internal data, benchmarks, and people analytics to establish specific goals and determine appropriate key performance indicators (KPIs) for measuring progress.
Accountability. Measure setbacks and achievements regularly based on precise KPIs that target your company’s specific goals. Be transparent about DEI goals and publish progress reports to reinforce accountability and commitment.
Targeted recruiting. With the growing popularity of remote work, targeted recruiting is easier than ever. Make recruiting connections with veteran groups, historically Black colleges and universities (HBCUs), women’s colleges and universities, and diverse professional associations, such as Lavender Law and the Society of Women Engineers.
There is no one way to “do” DEI. It requires focus, time, attention to detail, and reliable data. A commitment to diversity, equity, and inclusion is one thing, but incorporating data, analytics, and KPI tracking enhances your ability to achieve your DEI goals.
Visit thinksight.io for more on using people analytics to drive effective change and improve your bottom line.