rhodkin@businessinsider.com (Reed Alexander)
Black Americans continue to face a disproportionately harsh economic situation, according to a new study from McKinsey & Co. Willie B. Thomas/Getty Images
A study released by McKinsey & Co. illustrates the harsh economic reality faced by Black Americans.
More than 3 million Black American households were found to have a negative net worth.
One key cause is that Black Americans command single-digit shares of high paying jobs.
On the eve of the holiday Juneteenth, which celebrates the ending of slavery in the United States, management consulting firm McKinsey & Co. has warned that economic disparities facing Black Americans have stranded millions with negative net worths and reduced their life expectancies.
The new research, which underscores the harsh systemic challenges that continue to encumber the Black community, points to several factors.
For one, McKinsey said, Black workers comprise small, single-digit shares of the total number of professionals in highly-paid careers like physicians (5%) and software developers (4.5%), the global management consultant found.
It's also tougher for members of the Black community to rise through the ranks of corporate America. For every 100 men in the US who are promoted into managerial positions, just 58 Black women are promoted into management roles, according to a study by LeanIn cited by McKinsey.
And while nearly 13% percent of the US private sector workforce is composed of Black workers, that demographic is pulling in just 9.6% of total US wages.
Perhaps most striking of the study's findings were data points like this one: In a world in which racial pay gaps didn't exist, Black wages in the US would be $220 billion higher annually, according to the study, which was previously reported by CNN.
What's more, 19% of Black families - about 3.5 million in all - are now hindered by a negative net worth as a result of carrying excess debt, as compared to just 8% of white families who are in the same position, McKinsey said.
Among American families that do count a positive net worth, white families have a median net worth of $188,000, as compared to Black families, whose median net worth is $24,000.
Over the past year, business leaders have become more vocal about societal issues. In fact, it's hard to count the number of CEOs who are speaking out about diversity, equity, and inclusion (DEI) right now.
But which companies are actually following through with their DEI promises? Fortune and research firm Refinitiv examined Fortune's 500 biggest companies in the US, gathering data on each company's diversity statistics.
They ranked the companies based on 14 equally weighted metrics that measured how much diversity data the company shares including the percentage of people of color on a company's board, the percentage of women employees, the percentage of women managers, among others. Each diversity data figure was worth one point, and the companies were then ranked based on their score. Companies that disclosed the most data came highest on the list, like Microsoft. Other companies that came in the top 20 include Intel, Verizon, and Allstate.
At a time when employees, customers, and investors are demanding that corporations address diversity, the list helps identify companies that are ahead of the pack. Nearly 70% of companies in the Russell 1000 release no data on the racial and ethnic makeup of their workforce, per Just Capital.
Jasmine Hill, founder of DEI consultancy Radiant Slate, said that surveys like these help encourage companies to be more transparent in their workforce data and to keep up with their competitors.
"Sharing diversity data on a company's workforce is essential for starting the conversation," Hill told Insider. "However, actively using the data to improve the working environment of marginalized groups is far more important."
Diversifying the workplace is not just about collecting data, it's about addressing gaps in representation and fostering a sense of inclusion among your workers at the same time.
"Diversity is about who's in the room, but it's time to start moving towards inclusion."
Read the original article on Business Insider
The pandemic has inflicted further economic harm on Black Americans
McKinsey said that the coronavirus crisis has worsened the Black community's economic anguish.
Indeed, the firm said that the fallout from COVID-19 has disproportionally cost Black workers their jobs; deprived them of their savings; and exposed them to significant health risks, given that frontline jobs which were largely held by Black employees left many workers vulnerable to the virus.
Geographically, the McKinsey research found that Black workers are primarily spread throughout southern states.
More than 56% of the Black labor force lives in states in the country's southern region, like Texas, Florida, and Georgia. That left the authors to suggest that other regions, like states in the west and Pacific, would have to rethink their recruiting strategies to attract Black talent.
"Black workers are underrepresented in the highest-growth geographies and the highest-paying industries," the study authors wrote. "They are overrepresented in low-growth geographies and in frontline jobs, which tend to pay less."
The McKinsey study is far from the first to shed light on Black America's economic reality.
One Pew Research Center analysis from 2018 looked at the standard income ranges of earners in both the Black and white communities in America.
The analysis found that earners at the 90th percentile of the Black community's range generated just 68% of what earners at the 90th percentile of white community's earnings spectrum did.
Looking forward, the authors of the McKinsey study said changes based on the findings could help make strides in the right direction.
"Addressing the wage disparities described in our research alone could propel an estimated two million Black Americans into the middle class for the first time," they wrote. "This could reverse current trends, with cascading effects lifting the prospects of the next generation even future."
Read the original article on Business Insider
Gallery: Microsoft tops the list of most transparent companies for diversity data. Here's how far the top 5 have come - and how they can still improve. (Business Insider)
Slide 1 of 6: Fortune and research firm Refinitiv assessed Fortune 500 companies on their diversity data. Companies were rated on 14 metrics, such as the percent of women in management positions. Microsoft, Target, and Gap ranked in the top five companies. See more stories on Insider's business page. Over the past year, business leaders have become more vocal about societal issues. In fact, it's hard to count the number of CEOs who are speaking out about diversity, equity, and inclusion (DEI) right now.But which companies are actually following through with their DEI promises? Fortune and research firm Refinitiv examined Fortune's 500 biggest companies in the US, gathering data on each company's diversity statistics.They ranked the companies based on 14 equally weighted metrics that measured how much diversity data the company shares including the percentage of people of color on a company's board, the percentage of women employees, the percentage of women managers, among others. Each diversity data figure was worth one point, and the companies were then ranked based on their score. Companies that disclosed the most data came highest on the list, like Microsoft. Other companies that came in the top 20 include Intel, Verizon, and Allstate. At a time when employees, customers, and investors are demanding that corporations address diversity, the list helps identify companies that are ahead of the pack. Nearly 70% of companies in the Russell 1000 release no data on the racial and ethnic makeup of their workforce, per Just Capital.Jasmine Hill, founder of DEI consultancy Radiant Slate, said that surveys like these help encourage companies to be more transparent in their workforce data and to keep up with their competitors. "Sharing diversity data on a company's workforce is essential for starting the conversation," Hill told Insider. "However, actively using the data to improve the working environment of marginalized groups is far more important." Diversifying the workplace is not just about collecting data, it's about addressing gaps in representation and fostering a sense of inclusion among your workers at the same time. "Diversity is about who's in the room, but it's time to start moving towards inclusion."
1/6 SLIDES © Courtesy of Comparably
MICROSOFT TOPS THE LIST OF MOST TRANSPARENT COMPANIES FOR DIVERSITY DATA. HERE'S HOW FAR THE TOP 5 HAVE COME - AND HOW THEY CAN STILL IMPROVE.
Fortune and research firm Refinitiv assessed Fortune 500 companies on their diversity data.
Companies were rated on 14 metrics, such as the percent of women in management positions.
Microsoft, Target, and Gap ranked in the top five companies.
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