Will Challenging Times Impact Diversity Efforts?
Considering the relative youth of these programs, there's much interest in letting them continue to build their impact, says Norma Gomez, chief operating officer at the national headquarters of the Association of Latino Professionals in Finance and Accounting in Los Angeles. She thinks the layoffs and market changes won't have much impact. Of course, she adds, "There really hasn't been enough time to analyze what's going on or gather any data, but our organization has certainly seen an increase in interest in diversity efforts by the banks and investment firms."
Are Times Changing?
Certainly, time will tell if the latest round of layoffs and industry rumblings will impact women and minorities in the finance industry, but Securities Industry and Financial Markets Association (SIFMA) spokesman Travis Larson believes the business's commitment is clear. "Companies will continue to look for the best and the brightest and will utilize diversity hiring practices as a part of that effort, and a market downturn will not change that," he says.
During the last economic downturn, women and minorities in finance held their ground. In a July 16, 2004, letter to the New York Times, Marc E. Lackritz, president of SIFMA's predecessor, the Securities Industry Association, noted that "women and minorities held 27 percent of 'executive management' positions in 2003, up from 20 percent in 2001. They also filled 33 percent of the investment banking positions in large firms, a 9 percent gain from 2001." He continued, "Remarkably, these increases occurred during a time when our industry experienced one of its most significant recessions ever and when overall industry employment declined by about 11 percent."
A recent report from SIFMA on diversity hiring does suggest the "workforce profile remains relatively unchanged from 2005." (Note that the 2007 data was compiled before the recent industry problems.) The association's 2007 Report on U.S. Workforce Diversity and Organizational Practices surveyed more than 330,000 industry employees - about 41 percent of member firms' U.S. work force. The largest single group - 45 percent - was made up of white men. White women comprised 31 percent, men of color made up 11 percent, and women of color were also 11 percent. Those whose race/ethnicity was unknown or reported as "other" totaled 1 percent each for men and women.
The report notes that women and people of color still face challenges in getting to higher levels in their organizations. "From the associate level onward, representation of women and people of color decreases at each higher level across the survey organizations."
Interestingly, the survey also shows that women were hired at rates below their current representation at almost every job level, and the percentage of hires that were Blacks or Latinos was almost identical to their current representation. Asians were being hired at the same or higher rates as their current representation.