Over the past 30 years, diversity, equity, and inclusion (DE&I)—specifically for Black workers throughout the ranks—has become an increasing priority for the US private sector. Each year, companies collectively spend hundreds of millions of dollars on DE&I initiatives. They have implemented a range of programs to reach out to a diverse talent pool and create a culture that supports workers from all backgrounds. Yet progress has proved frustratingly slow. Placing a higher value on diversity and implementing targeted initiatives have not closed the representation gaps for Black workers. At many companies, the existence of DE&I programs has been treated as success, even as better and scaled outcomes have remained elusive. There is a continued sense that Black workers are missing out on opportunities in the private sector that hold the promise of advancement—and the rising economic security that comes with it.
The year 2020 was a watershed moment for the conversation about racial injustice, including race in the workplace. The killing of George Floyd and the subsequent sustained protests demanding social justice motivated US companies to reevaluate how they could support their own Black employees and play a larger role in addressing structural racism in society. All told, in 2020, US companies made public commitments of more than $66 billion in financial support and initiatives to combat racism, support Black communities and businesses, and promote racial equity, as tracked by the McKinsey Institute for Black Economic Mobility.1 According to the Racial Equity Institute, “Systemic racism has contributed to the persistence of race-based gaps that manifest in many different economic indicators.”2 Over the past few years, McKinsey has conducted research on several issues related to Black racial equity, including Closing the racial wealth gap, Accelerating financial inclusion in Black communities, The future of work in Black America, COVID-19: Investing in Black lives and livelihoods, and, most recently, America 2021: The opportunity to advance racial equity.3 An important aspect of racial equity is related to the workplace itself and the steps companies can take to increase access to opportunity for Black workers and to ensure they have the same chance for career advancement. Addressing the systemic racism that many describe will likely require system-level solutions. What actions are companies best positioned to pursue? Therefore, as part of our continuing research, the research in this report focuses on this aspect of racial equity.
Our motivation in conducting the research highlighted in this report has been to try to establish a fact base for what representation looks like for Black workers across the US private sector. In addition, we sought to understand the Black experience inside companies. The research had two key fact-based components:
First, a comprehensive benchmark analysis of Black Americans in the US private sector, across counties and industries and highlighting key gaps in representation. The analysis draws on publicly available data through 2019 from the Bureau of Labor Statistics, the US Census Bureau, and the US Equal Employment Opportunity Commission—among other sources—and covers the 125 million-person private-sector labor force.
Second, we augmented this analysis by inviting companies to participate in our research in order to gain additional insights into employment and representation as well as the experience of their Black employees. The research analyzed overall employment data from 24 companies, including some of the largest private-sector employers in the United States, who participated in this research across their total of about 3.7 million US employees. The research also analyzed data on employee experience gathered through a combination of focus groups, interviews, and an inclusion-and-experience survey with nearly 25,000 respondents.
Given the immense challenges relating to race in the workplace, our research in this report—including the fact base—is undoubtedly incomplete. Moreover, this report does not aim to provide a comprehensive examination of issues and their underlying causes, many of which are understood to be rooted in the history of America. Such research was outside the scope of this report. In addition, this report does not include longitudinal data on representation or experiences—something we hope to build on in the coming years. It should also be noted that the research in part one is largely based on 2019 data and as such does not include the impact of COVID-19 on employment and labor markets in general. Lastly, this report does not aim to provide prescriptive and comprehensive solutions, but
it suggests a path forward for companies and stakeholders.
However, we hope that the report serves to highlight the scale of the issues facing Black workers in the private sector and leads to better understanding of the challenges, thereby galvanizing action for system-level change and better and scaled solutions.
Our hope is that companies and other stakeholders consider potential options in this report to guide the development of initiatives to accelerate progress toward a more diverse labor force and inclusive and equitable private-sector experience for Black workers—and all workers. We also plan to continue to contribute to both ongoing research and initiatives to help accelerate progress.