By 2040, America’s demographic landscape is expected to look quite different than it does today: Minorities will be the majority, and 1 in 4 Americans will be of Hispanic/Latino origin. If you peer into most Silicon Valley tech companies today (or most Fortune 500 companies, for that matter), the workforce you will see does not at all match current or projected demographic realities.
Diversity is arguably even more important in sectors like tech, where creativity and out-of-the-box thinking are vital for success. According to organizations such as Code2040, this racial and ethnic disparity is not only a business risk – it’s the greatest economic opportunity of our time.
"Companies that have ethnic and racial diversity perform 35 percent greater than those that do not," said Karla Monterroso, vice president of student programs at Code2040.
"In tech, diversity is often not on the top of people’s list because often times those in the tech system don’t have diverse networks. Yet, we’re seeing that the current tech talent pool is increasingly shrinking, and in the future not having a diverse pool is going to limit companies from taking off. Right now we have the luxury of seeing the cliff before the horizon line."
According to the U.S. Bureau of Labor Statistics, 1 million tech jobs will go unfilled by 2020 at the current rate that qualified students (white, black or brown) are graduating with science, technology, engineering and math (STEM) related degrees and joining the tech workforce.
To address the talent gap and help transform the nation’s economy, Code2040 places high performing Black and Latino software engineering students in internships with top tech companies. They also provide students with mentorship, leadership training and network development to accelerate students’ success in the tech sector. In return, these students bring their fresh perspectives, new ways of thinking, and creativity to spur innovation in a sector currently of and for the few.
"Startups are best at solving the personal problems of their founders – the more diverse the founders, the more problems can be solved and the more people who can be positively impacted by technology," said Michael Seibel, partner at the seed accelerator Y Combinator.
"Big companies need to invest in outreach and be involved in marketing software engineering and computer science to the best and brightest minority and women math and science students. Startup angels, incubators and accelerators need to step up outreach and make themselves more welcoming to a diverse set of founders."
In addition to helping solve more problems for more people, a diverse workforce can also benefit a company's bottom line. A recent McKinsey & Co. report, Diversity Matters, reveals that companies with the highest rates of ethnic and gender diversity are 35 percent and 15 percent, respectively, more likely to achieve better financial performance than their industry counterparts.
Some Silicon Valley companies are making strides to tackle the racial and gender gap in tech. Earlier this year Intel announced its pledge to spend $300 million to support workforce diversity, and Google just announced it will invest $150 million this year – an increase from the $115 million it spent last year – to attract more women and minorities to the company and the tech industry. Apple and Symantec have also invested dollars and time to help narrow this inequality gap.
"A lot of times when people think of diversity, they think of it as an emotional problem, but it’s an operational imperative," Monterroso said. "The more the companies invest in diversity now, the better off we’re going to be."
Diversity of workforce will lead to diversity of talent and output. This can only lead to more resilient companies with the deft and creativity to respond to market needs.
Image courtesy of Code2040
Nayelli is the Founder & CEO of CreatorsCircle, a resource hub that connects diverse youth with opportunities to create a life of purpose and impact. A trained journalist with an MBA, she also keeps the pulse on sustainable business and social impact trends and has covered these topics for a variety of publications over the past 15 years. She’s a systems thinker who loves to learn, share knowledge and help others connect the dots.