Equality at Work in the USA. The development and practical implementation of Diversity Management

Term Paper (Advanced seminar), 2014

22 Pages, Grade: 1,7



1. Introduction

2. Historical background for the development of Diversity Management as idea

3. Labor market statistics

4. The Overview of the propagation of Diversity Management in economical context
4.1 Practice of Diversity Management at IBM
4.2 Practice of Diversity Management at Google Incorporate

5. Conclusion


1. Introduction

Different employees mean different kinds of potential you can profit from as an employer. That would be the easy way to think about this issue. But what happens if there is a discrimination of employees which is inadequately justified? This problem leads inevitably to discontentedness as well as to wasting important potentials. One attempt solving this problem is called diversity management.

In reference to the USA it is apparent that the high rates of immigration led to a multicultural population which compulsory leads to diverse workforce in the country. Besides the Hispanic and Asian population the African Americans also represent one of the big ethnic groups in the USA. But indeed Lillevik, Combs and Wyrick show that in spite of the overrepresentation of the African American in the US population labor market figures reveal an underrepresentation of this ethnic group concerning the employment rate (Lillevik, Combs & Wyrick, 2010).

“The current overall unemployment rate in the USA is 9.2 per cent; this is much lower than the figures for African Americans (14.9 per cent), and for those of Hispanic origins (12 per cent) (Bureau of Labor Statistics, 2009). The unemployment rate for whites is 8.4 per cent (Lillevik et al., 2010). “

Looking at this numbers we can recognize that there has to be an unequal access to the labor market for the different ethnic groups in the US population. Even though it would be important to look at the reasons for this unequal distribution the focus of this study is to analyze the discrimination of the African American population in the USA concerning their access to the labor market. In this regard we represent the hypothesis that the ethnic minorities especially the African Americans are discriminated against in comparison to the White Americans. This problem becomes apparent looking at the access to the labor market, leadership positions and equal payment.

Our study is structured in three different parts. At first we like to take a look at the historical background especially emphasizing on the Civil Rights Movement which is an essential period for the African American people. Besides the bills which were passed during this period we also want to focus on the current legal situation concerning the discrimination of certain ethnic groups.

In the second part we want to analyze the current labor market situation. How was the development of employment rates of the main ethnic groups in the last years and what is the current situation? Furthermore we have to take a look at the average income of the employees especially analyzing the differences between the main ethnic groups in the USA. In the last part of this chapter we will discuss the discrimination of the ethnic minorities concerning the access to executive positions.

The last part of our study concentrates on the analysis of a certain organization to illustrate how diversity management can actually look like in practice. In this connection we will firstly analyze to what extent diversity management is spread in the USA and secondly have a look at the implementation of diversity management in the organizations of IBM and Google. Here we want to especially prioritize the African Americans.

Finally we will draw a conclusion and refer to our hypothesis to proof which aspects of our hypothesis were shown to be true and which aspects were disproved. On the basis of this analysis we will see where academic voids have to be closed and where future academic projects have to put their emphasis.

2. Historical background for the development of Diversity Management as idea

Barack Obama, the president of the United States of America, commemorated Martin Luther King Jr. about his capacity for the equality of minority groups in August 2013. He has drawn attention to the lack of finishing the task of equality in social and economic issues. Nevertheless he has appreciated the effort of creating equality in some social and economic areas (Pitzke, 2013: 1). This shows that the debate of the internalization of diversity to promote equality in companies is not finished yet.

In this part of our view on the equality at work in the USA, it is important to look at the historical development of the civil rights movement of the African Americans and other minorities at the significant period of the civil rights movement since the beginning of the 1950’s. From this you can derive the following debate about diversity management as economical issue of efficiency. Dr. Martin Luther King and his contemporaries demand the civil rights for all people of America without discriminating people on the basis of their origins, sex, or other discriminating terms. But before King gave his speech “I have a dream” in the year of 1963, other incidents took place in the beginning of the 1950’s. 1954, the first eminent decision of the Supreme Court for the African Americans was the “Brown v. Board of Education”(Vedder, 2008: 3). This Supreme Court decision included the repeal of segregation in public schools, which was the first in the aspect of equality, besides the ending of the slavery in the USA in 1865. One year later, 1955, the Rosa Parks bus boycott ensured to a large rebellion against the white proletariat in traffic. It was prohibited for the African Americans to take a seat in bus when a white person entered the bus and wanted to sit. In this bus boycott the African Americans demanded the repeal of segregation in traffic, especially in public transport. After two years the first civil rights act was adopted in 1957, which repealed the discrimination in public transport and integrated more rights concerning to election. In the course of the year, King proclaimed his strategy of protest. “Borrowing from the philosophy of Mahatmas Gandhi, King stipulated a non-violent direct action strategy that captivated blacks and solidified the support of whites […]. From this platform black organizations worked together […]” and “other supporters […] such as the Anti-Defamation League, the American Jewish Congress, American Civil Liberties Union, and the American Federation of Labor-Congress of Industrial Organizations”(Lillevik, Combs & Wyrick, 2010: 307). On the base of these protests of peace, 1960 the second civil rights act was adopted, which “introduced penalities for those people who tried to prevent the registration for election of African Americans. On 28th of August King held his speech in front of the Lincoln Memorial and drew attention to the words of Constitution and the Declaration of Independence.

“This note was a promise that all men, yes, black men as well as white men, would be guaranteed the "unalienable Rights" of "Life, Liberty and the pursuit of Happiness." It is obvious today that America has defaulted on this promissory note, insofar as her citizens of color are concerned. Instead of honoring this sacred obligation, America has given the Negro people a bad check, a check which has come back marked "insufficient funds." (Without Author 2014:1) In the same year the next act for the civil rights was passed. The Equal Pay Act of 1963 prohibited unequal conditions in payment concerning to gender. Men and women had to be paid equally in employment. This was the first aspect of gender equality in economic areas. One year later in 1964 the Civil Rights Act Title VII was passed, which is the most important civil right for the development of diversity management in the future. “Legislation in the USA that prohibits discrimination on a variety of bases is encompassed in an assortment of different legal statutes” (Lillevik et. al., 2010: 308). […] Title VII prohibits “employment discrimination based on race, color, religion, sex and national origin” (US Equal Employment Opportunity Commission, 1964).

This Act gave the employees, independent of their origins, more rights in economically aspect. In the following years from 1965 to 2008 more civil rights were passed, especially in economically context. 1965 there was a extension of the right to vote. In 1967 to 2008 there were passed other acts to prevent discrimination at the workplace, the Pregnancy Discrimination Act of 1978, the Age Discrimination Act in Employment of 1967, the Americans with Diabilities Act of 1990 with the following new-definition in 2008 and the Genetic Information Non-discrimination Act of 2008, which you can see as an extension to the Civil Rights Act Title VII of 1964. This Act includes “a reflection of modern science, prohibiting discrimination on the basis of genetic information provided to both employers and health insurers” (Lillevik et. al., 2010: 310).

After this Introduction in the civil rights movement and its consequences in legislation we take a view on the development of the debate of diversity management, especially of the economic aspect of diversity at the workplace for the efficiency in companies. On the basis of the Civil Rights Act of 1964 the US government passed the integration of the Equal Employment Organization, which till now had the task to observe the companies. This observation included the integration of equality of minority groups, according to the mentioned act above, in companies and sanctioned those companies, which denied the integration of minority groups at the workplace.

But the first efforts of the integration of minorities were without a major result. In conclusion to this bad success, the government integrated the affirmative action plans, which contained an indirect quota regulation. In 1968 the companies, which wanted to become connected with the government for economically activities about 50000 dollars, had to be declare the number of minorities in detail, which they had integrated at the workplace (Dobbin, Sutton, Meyer & Scott, 1994). Since 1970 the companies drew attention to the diminished economic advance reasoned by the introduction of the affirmative action plans. Also there was a debate about the reverse discrimination concerning to the favoritism of minority groups at the workplace. The white people argued that they are now the discriminated group at the workplace. Consequently Ronald Reagan, the president of the USA in this time, defused the debate with a relaxation of the affirmative action plans. On the basis of this debate Anita Rowe described this development as affirmative action backlash, which interfered the success of affirmative action plans (Vedder, 2006: 4).

In the middle of the 80’s on the basis of the civil rights movement there was an upcoming consideration of diversity as an aspect of management. The basis of this consideration was the lack of real success of equality, the dissatisfaction of the implementation of the EEO and AA plans and the rational of the connections between the types of discrimination. The companies integrated the policy of equality in the structure of organization in terms of team-buildung and conflict resolution. Furthermore the companies integrated an internal control to show the success or bad success interoffice. In addition to the basis of an implementation of diversity at the workplace were arising in an economical debate of efficiency on the market. The companies reacted to the changing socio-economic structure including the demographic development. Pioneers of the economy, like Ford, included the discourse of diversity in companies as a potential to get a competitive advantage and to slash of the costs. Furthermore the companies integrated the labels ‘culture’ and ‘diversity’ in their commercial business principles. The line of argumentation is changing from a fight against discrimination to an economic use of intercultural competence (Vedder 2006: 5).

In the following chapter we draw attention to the labor market development concerning the discrmination of ethnic minorities especially emphazisizing on the African American. Regarding to this we will analyze the data by three categories: the access to the labor market, eqal payment and the access to executive positions. Furthermore we will also refer to demographic changes prognosticated by the workforce 2000 report.

3. Labor market statistics

After the illustration of the historical background and the relevant laws which actually should guarantee equal opportunities for each ethnic group, we will now start with the analysis of the US labor market. This chapter represents the basic part of the study as we are able to get an objective impression through the data. After this part we will be able to issue a first statement about the validity of our hypothesis.

Although a look at the GDP and economic growth of the USA would be interesting, it will not help us verifying our hypothesis. So we concentrate on three main categories: unemployment rates, earnings and executive positions. First of all we will look at how the U.S. population is composed of the different ethnic groups to check how big the ethnic minorities actually are.

Figure 1: Ethnicities in 2012 and prognostication for 2060

illustration not visible in this excerpt

Source: US Census Bureau 2012

Figure 1 shows us the percentage of the different ethnic groups in the U.S. population in the years of 2012 and 2060. It is apparent that the Whites represent the biggest group of the population with a percentage of 63%. The Hispanics (17%), Blacks (13%) and Asians (5,1%) are indeed the biggest ethnic minorities in the USA but nevertheless clearly underrepresented. As we can see in figure 1 there will be an interesting development in the different percentages of the population so that in 2060 the ethnic minorities will represent more than the half of the whole population. What does such a development mean for the labor market? What will be the main issue in the future?

The whole structure of the labor market concerning the employees and the ethnic minorities will change dramatically. Such a development was already prognosticated by Johnston and Packer in 1987 when they released the results of the Workforce 2000 report (Johnston & Packer, 1987: 76). One of the quintessences of this report was the fact that the future employees and especially the executives have to be recruited out of women and ethnic minorities as the share of these groups in the labor force will grow in the future. So the organizations had to adapt their recruiting strategies and start thinking about a way to manage the future diverse workforce which meant a great success for the concept of the diversity management (Vedder, 2006: 5f.). The following quotation summarizes the just illustrated issue:

“The predicitions of workforce demographic changes and the attention given to the complexion of US corporations contributed to a renewed, yet different, interest in diversity.” (Lillevik et al., 2010: 322)

The closer look at the US population should only illustrate the current relevance of the topic and arbitrate a basic understanding. On this basic we will now look at the first category.

Figure 2: Unemployment rates of ethnic groups in the USA

illustration not visible in this excerpt

Source: Bureau of Labor Statistics 2014a

On the one hand figure 2 shows us the overall unemployment rate of the US population which constantly fell in the space of time from October 2013 (7.2 %) to October 2014 (5.8 %). On the other hand we can also see the unemployment rates of the different ethnic groups. Especially the big differences between the unemployment rates are very eye-catching. In comparison to the Whites, Asians and the Hispanics the Blacks have by far the highest rate of unemployment. Focusing on the Whites and Blacks it is quite obvious that the unemployment rate of the Blacks lies 5.1 percentage points above the average whereas the Whites lie 1 point under the average. How can such a difference be explained?

Besides the high unemployment rate, the Blacks didn`t benefit from the overall decreasing unemployment. While the unemployment rate of the Whites dropped by 0.3% the unemployment rate of the Blacks dropped only by 0.1%. Overall it is quite clear to see that the ethnic minorities especially the Blacks are slightly discriminated concerning the access to the labor market.

The next aspect we want to mention is about the earnings of the different ethnic minorities. For instance we could ask the question whether there are any differences between Whites and Blacks, Asians and Hispanics or males and females. Furthermore we will also check which ethnic group is the worst paid one. By figure 3 we can assert that there are existing big differences between the ethnicities concerning the earnings even though they belong to the same occupation. Furthermore it is obvious that the average wage of women is always worse than the wage of the men. The fact that the figure only includes the wage of full-time employees confirms that the lower wage of the women and the other ethnic groups can`t be explained by shorter labor time. If you look at the figure you could ask the question why a male White professional nearly earns 1300$ per week whereas a male Black only earns 1000$? How can such a big difference be justified? It`s a question of discriminating ethnic minorities especially the Blacks and Hispanics.


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Equality at Work in the USA. The development and practical implementation of Diversity Management
Helmut Schmidt University - University of the Federal Armed Forces Hamburg
Management of Human Ressources II
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ISBN (eBook)
ISBN (Book)
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equaliy, workplace, usa, diversity management
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Norman Groth (Author)Marco Kampling (Author), 2014, Equality at Work in the USA. The development and practical implementation of Diversity Management, Munich, GRIN Verlag, https://www.grin.com/document/315774


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