How to set diversity hiring goals using the total available tech talent market
December 3, 2021
If there’s one thing we’ve observed in the conversation about diversity hiring over the last few years, it’s that talent acquisition is needing to have fewer and fewer conversations with leadership teams around “the business case” for diversity. Executives have not only heard the business case loud-and-clear; they also acknowledged the ethical case—if they hadn’t already—after the Black Lives Matter movement of 2020 and the racial and gender inequities that COVID further exposed (and exacerbated).
This shift in the conversation is a critical step forward. But what follows is a different set of questions—not around why, but around how. How does recruiting set market-based diversity hiring goals and define success for itself?
It’s a question that’s plagued tech recruiting most obviously: demographic numbers in tech reveal—over and over again—an industry dominated by White and Asian men. In its 2020 Diversity Annual Report, Google disclosed that 3.7% of its U.S. tech workforce is Black and 5.9% is Latinx. (In EMEA, those numbers drop to 2.8% and 3.8%, respectively.) Salesforce’s most recent data shows that 2.7% of its tech employees are Black, while 4.0% are Hispanic or Latinx. Facebook’s demographics are 2.1% Black and 4.6% Hispanic across its technical roles. Compare these numbers to Census Bureau data on the percentage of Black and Hispanic tech workers in these U.S. cities:
From a competitive standpoint, comparing your internal demographics to industry averages certainly aids in setting realistic goals. But there are three other sets of benchmark data you should be using to set your diversity hiring goals:
The available talent market for the roles (in this case, technical roles) that you’re hiring for. In other words, if you’re hiring for technical roles in Washington, D.C., what percentage of tech talent in that geo is Black and Latinx (or Native American or Alaskan Native or two or more races, etc.)?
The demographics, broadly speaking, of your company’s location. Does your workforce reflect the diversity of the communities that your headquarters and other offices are situated in?
The demographics of your customers. Does your workforce reflect the diversity of the communities you serve?
Of course, we can’t tell you about the demographics of your customers—or of the customers you hope to one day have. But we have done some research into the demographics of available tech talent in major U.S. geos so you have benchmarks to ensure the diversity hiring goals you set are realistic. Ultimately, the demographic breakdown of total available tech talent in these geos helps you do more than set market-based diversity goals. If your org offers relocation, it can inform which geos to source from. It can help you take future office location strategy into consideration. And so on.
Here’s how to use the total available tech talent market to set your diversity hiring goals:
Step 1: Know the Total Available Tech Talent in Your Geo/s
For Gem’s Tech Recruiting Diversity Benchmarks report, we used U.S. Census Bureau data from its annual American Community Survey (ACS). We used the category “Computer & Mathematical Operations,” which covers everything from computer programmers, to software and web developers, to network and computer systems administrators, and more. It’s a broad category, but it offers an accurate picture of the percentages of different demographic groups in tech by geo. The Census Bureau’s dataset is a bit unwieldy and not very intuitive; but if you’re willing to do the work (or you have a data analyst to help!), you can arrive at these numbers.
Other sources to turn to for U.S. (and global) talent market data include LinkedIn Talent Insights and Gartner TalentNeuron. The point is to get a sense of how many tech workers there are in whatever demographic groups you know you need better representation from (more on identifying your gaps below). For example, here’s the most recent Census Bureau data on tech talent in Washington, D.C.:
48% of tech talent in D.C. is White, nearly 18% is Black or African American, 23% is Asian, and nearly 7% is Hispanic/Latinx. So if you’re hiring for technical roles in D.C. and you’re looking for representation that mirrors the total available market, these are great numbers to start with for your long-term diversity hiring goals.
Step 2: Know the Overall Demographics of Your Geo
At Gem, our recommendation is to use local data to first match the talent market, then to beat it. Whatever city you’re hiring in, you’ll probably notice that the percentage of both Black and Latinx talent in technical roles for your geo is lower than the total percentages of Black and Latinx residents of that geo. Note, for example, that while the Washington, D.C. metro area is 46.3% Black, Blacks make up only 17.7% of tech talent there:
These disparities are indicative of wide-ranging educational inequities that, if you’ve been paying attention, you’re already aware of. If your organization is in a position to train underrepresented talent locally, to offer internship programs to get them more exposure to tech, or to partner with organizations that do precisely that, this is one way of beginning to solve for that inequity. When discussing how the talent acquisition team at Pure Storage sets its diversity hiring goals, Angela Miller, Senior Director of Global Talent Acquisition and Ops, said it well:
“Our litmus for success is to first match the market, then beat it. If the market says that 25% of software engineers in the Bay Area are women, then the top of our funnel initially needs to be 25% women. And once we get there, let’s go to 30%. We’re not saying we’re going to get gender parity in our pipeline. We’re saying let’s do at least as well as mirroring what the market has available, and then pull other levers to increase diversity where we can. That’s market intel.” - Angela Miller, Senior Director of Global Talent Acquisition and Ops @ Pure Storage
Of course, if your org is fully remote, you might consider using the demographics of the U.S., broadly speaking, to set your diversity hiring goals. Here’s what the most recent census data shows:
Step 3: Identify the Gaps in Your Organization
You’ve now got the data of the geos you’re working in and looking at. But how do you use those numbers to set diversity goals and inform a broader hiring strategy? It’s difficult to come up with diversity hiring goals without knowing where you’re deficient in representation. So take a demographic survey of your org. Disaggregated data should be available from your HR department (it should exist in compliance with the EEOC and Civil Rights law). Ask for the numbers from the last 5 years.
Dig deeper than team-level metrics. It’s one thing for your org to realize a 50/50 split of male and female engineers; but if your eng leadership is all male (or white) and “equity” only occurs among your ICs, your organization isn’t nearly as equitable as it appears with surface-level statistics. Slice by role and seniority level to give yourself the complete view of your diversity landscape. This way you can come up with a sourcing strategy for each role you have to fill.
Compare your numbers to the demographic data you’ve uncovered concerning the total available tech talent in your geo. (Compare them, too, to industry averages, and to the demographics of your customers if that’s useful.) The disparities between your demographic data and any of these data sets will serve you in setting target demographics for individual roles—as well as for your entire talent pipeline. Then come up with a sourcing strategy for each role you have to fill based on what your team currently lacks in representation. Map out a 1-year plan and a 5-year plan so you can see how your efforts will evolve and build on each other over time. Remember: diversity hiring is a long game.
Step 4: Use “End Composition” Goals to Create Strategies and Set Milestones
Here’s the goal-setting part: sit down with hiring managers and leadership to define what “end composition” success looks like in a particular initiative. Maybe it’s “increasing the number of female employees in tech-related roles by 15% within the next 8 months.” Maybe it’s “doubling the number of Black engineers on our team this year.” These bottom-of-funnel goals should be realistic, but ambitious.
Your TA team will use these end-composition goals to guide its own diversity goals for the top of the funnel. Naturally, each initiative will have a unique top-of-funnel quota. Maybe it’s “50% diversity in initial phone screens for our VP of Eng role.” Maybe it’s “12 onsites with female engineers in Q3.” Remember, you’ll be getting both referrals and inbound applicants all the while. Since those channels tend to be less diverse, you’ll want to offset those numbers by targeting and sourcing passive talent.
Metrics will alert you to how roles typically get filled. If you observe that some roles are strongly driven by referrals—and that those referrals tend to make it through process—you might raise the quota for out-of-network diversity sourcing at the top of the funnel. After all, this is the only part of the funnel in which you can exert control. Once candidates are interviewing, you’ll have to evaluate them all equally.
Once explicit goals are in place, create action items and strategies to meet them. Include key milestones in your map so you know—and can celebrate—when you’re making progress.
Step 5: Measure, Measure, Measure
Recruiting teams are often laser-focused on a single metric when it comes to diversity hiring goals for their organizations: how many underrepresented hires do we need to make (or did we make) in a given quarter? But focusing solely on number of hires doesn’t give you the full picture of your diversity efforts. A true measure of diversity hiring takes into account everything that happens from first outreach to offer-accept… as well as what happens after onboarding and beyond. Here are some other data points to pay attention to as you work toward meeting your diversity hiring goals:
Outreach activity: How many underrepresented prospects are your sourcers and recruiters reaching out to for a given role? What do response and interested rates look like for that outreach—particularly in comparison with the response and interested rates for majority talent for the same roles?
Funnel activity: Passthrough rates reveal where systemic biases might show up—by role, recruiter, or hiring manager—as some candidate segments get stuck at certain stages of the funnel. Are certain groups disproportionately dropping out of the funnel at specific points in the process?
Source of hire: Which recruiting channels are most effective in attracting and converting a diverse slate of candidates to your org?
Candidate experience: What’s the average satisfaction score for underrepresented candidates when it comes to your hiring process? How likely would they be to apply to your org again?
Performance and retention: What’s the average turnover/retention rate of underrepresented talent within the first year—and how does it compare to the same rates for majority talent? What’s the average performance rating of underrepresented talent after the first year (and again, how does it compare)?
Without these metrics, it’ll be difficult to understand how you’re trending to meet the diversity hiring goals you’ve set. Use them to stay curious, drill down into the pain points in your process, and optimize from there.
September 8, 2023
Top 5 Talent Acquisition Conferences You Can’t Miss in 2023
May 17, 2023
Recruiting in life sciences in 2023
April 5, 2023
Recruiting in manufacturing in 2023
Your resource for all-things-recruiting
Looking for the latest data, insights, and best practices? Welcome to the Gem blog. We've got you covered.
Get started with Gem today
See how Gem can help you hire with remarkable speed and efficiency