Agencies Are Losing Out on the Benefits of Diversity
In the wake of George Floyd's murder, marketing and advertising agencies pledged to increase diversity. But three years later, people of color still face a high risk of job loss and a lack of diverse leadership. According to the 2022 ANA Diversity Benchmark, 78.7% of employees in the sector are White. This is significantly higher than the U.S. population, which is 60.1% White.
There is a growing body of research that suggests that diversity can lead to a number of benefits, including:
Increased innovation
Improved decision-making
Enhanced problem-solving
Increased employee satisfaction
Reduced turnover
Increased customer satisfaction
Yet, despite these benefits, agencies have not made significant progress in increasing diversity. In fact, they are regressing.
Backlash and Backsliding
Marketing and advertising agencies are backsliding away from diversity in their workforce. Since 2022, disproportionate layoffs have accelerated, making it more difficult for diverse employees to advance their careers. This is due to the rise of conservative backlash against DEI and brands easing their accountability of agencies they work with. Job losses have become a procyclical hire-and-fire scenario that is repeated again and again. This is unacceptable and it presents many problems for the industry:
Lack of diversity is a problem of equity. A study by the University of Southern California found that Black or African American creative directors in the advertising industry are paid 23% less than White creative directors.
It is a problem of inclusion. Underrepresented groups can experience hostile workplaces where the following occurs:
Similarity Bias
Microaggressions
Feeling unwelcome or unsafe
Feeling demoralized or unmotivated
Stereotyping
Marginalization
It fosters discrimination. A 2018 Pew Research Center poll found that 55% of Black Americans believe they have been discriminated against in the workplace.
It causes turnover. 64% of diverse employees believe it is harder for them to get ahead than for White people. When they feel that they have no chance of advancement they are more likely to leave their jobs. But the market for finding better opportunities is a challenging one. A 2019 poll by the National Urban League found that Black job seekers are more likely to be offered lower-paying jobs than White job seekers. Black job seekers are also 2.5 times more likely to be rejected for a job than a White job seeker with the same qualifications.
The Revolving Door
As a person of color in the advertising industry, I have been forced to navigate the "revolving door" of employment. I have been laid off or marginalized from jobs, and I have had to build my portfolio and career as an independent freelancer. I have worked on big brand accounts for short stints at large agencies. So for me, the “gig economy” has been around much longer. This is a common experience for people of color.
Freelancing in the advertising industry can be a Hunger Games-like experience for Black creative professionals. While we experience gaps of employment, we often work with staffing firms who can help us secure freelance jobs, but they take a percentage of our hourly pay. When freelancing at a large agency, we are often billed out to clients at a high rate. So, we wind up being more profitable for the agency than for ourselves.
Diverse freelancers in the marketing and advertising industry are more likely to lose their work during economic downturns. They face structural inequality even in a stable economy, but these challenges are compounded in a recession. To find more stability and better pay, they seek full-time work at agencies that make diversity a priority. CIEN+ is a marketing firm that is doing just that. CEO Lili Gil Valletta's 2021 TEDx talk discussed the bottom line value of “Cultural Intelligence”. Our industry needs progressive approaches like these to be the drivers of success.
Diversity as a Key Performance Indicator (KPI)
A study by the Boston Consulting Group found that diverse leadership is linked to a 19% increase in revenue from innovation. Here are some examples of how diversity can be measured as a key performance indicator (KPI):
Gender diversity: The percentage of women in the workforce, in leadership positions, and in different departments.
Ethnic diversity: The percentage of employees from different ethnic groups, such as Black, Hispanic, Asian, and Native American.
Sexual orientation diversity: The percentage of employees who identify as LGBTQ+.
Disability diversity: The percentage of employees with disabilities.
By measuring diversity and tracking its progress, marketing and advertising agencies can ensure that they are making progress towards their goals and that they are reaping the benefits of a diverse workforce.