10 Types of Diversity in the Workplace You Should Know
As an HR professional, the first step to building a diverse workforce is understanding the types of diversity in the workplace. Today, workplace diversity is necessary and critical to your organization’s success. Moreover, 76 percent of job seekers cite workplace diversity as an essential consideration when evaluating job opportunities.
Let’s take a look at the different types of diversity in the workplace so that you can start managing it successfully at your organization.
Contents
Definition of diversity in the workplace
The importance of diversity in the workplace
Types of diversity in the workplace
Managing diversity in the workplace: Tips for HR professionals
FAQ
Definition of diversity in the workplace
Diversity in the workplace refers to the presence of employees from a wide range of backgrounds, races, ethnicities, cultures, ages, genders, abilities, religions, and other characteristics within an organization.
Workplace diversity creates a dynamic and inclusive environment. In addition, promoting workplace diversity creates a space where everyone feels valued and respected and can contribute to the organization’s success.
It’s important for HR professionals to understand the different types of diversity in the workplace, as some of the characteristics, like race, gender, and religion, are protected by law. Recognizing this helps ensure compliance with anti-discrimination regulations and fosters an inclusive and respectful work environment.
Check out our Learning Bite to learn everything you need to know about workplace Diversity and Inclusion!
The importance of diversity in the workplace
As the world becomes an interconnected global village, there are more expectations and demands for workplace diversity. Employees, governments, and most stakeholders want to work with companies that value diversity in the workplace.
Below are the most prominent benefits of workplace diversity.
1. Increased creativity and problem-solving
An excellent pool of ideas and creativity always arises when you bring people of different backgrounds together.
In fact, a study by the Boston Consulting Group found that enterprises with above-average diversity experienced 19% higher revenue from innovations.
Moreover, diversity prevents groupthink, which occurs when a non-diverse(homogeneous) group finds it challenging to solve issues because they lack the unique ideas and perspectives resulting from diversity.
But when businesses embrace diversity, they experience more creativity. Your workforce also increases the chances of developing new products and winning new markets.
2. Increased profits
In a McKinsey study, ethnically and racially diverse companies are 35% more likely to record financial returns above the industry median.
Other studies show that diverse enterprises earn 2.5 times higher cash flow for every employee. Employees in inclusive workforces are also 35% more productive.
The different perspectives, cultures, and backgrounds contribute to a virtually infinite pot of ideas, innovation, and creativity. In turn, your company can create great products and reach a broader market. All the above leads to more productivity and, of course, revenue increases.
3. Increased employee engagement
Diverse workforces result in greater employee engagement. One study found that diverse teams make better decisions 87% of the time compared to non-diverse groups.
In addition, 83% of Millennials are more actively engaged in their work when a company invests in creating an inclusive and diverse environment.
4. Reduced employee turnover
When a company invests in diversity and inclusion, employees are more engaged, and hence, a lower turnover. When there’s no diversity and inclusion, many employees will start looking for greener pastures. In fact, 80% of employees in a survey cite inclusion and diversity as essential when choosing a company.
Fostering diversity and inclusion makes employees feel accepted and valued. In turn, it helps reduce disengagement and, ultimately, turnover.
5. A positive workplace reputation
We’re in an era where employees are fearless about sharing their experiences while working for a company. Employees are eager to share their good or bad experiences on sites like Glassdoor. They’ll also share these experiences with peers, friends, and family.
If you have a culture of diversity and inclusion, it’s a plus for your company’s reputation. If there’s no diversity, new talent might be hesitant about accepting job offers from your company.
6. Access to a wider talent pool
Increased diversity efforts give you a diverse pool of talented candidates. For most candidates, diversity is essential in determining whether they accept your offer.
For instance, 39% of job applicants have rejected job offers because the organization was not invested in diversity and inclusivity.
Types of diversity in the workplace
Before you embark on improving diversity at work, you must first understand all the diversity categories and how they impact your employees’ experience in the workplace. Moreover, these different types of diversity overlap with each other. This is called intersectionality.
There are four basic types of diversity at work:
- Internal diversity: Consisting of observable traits such as race, gender, age, physical ability, ethnicity, and cultural identity.
- External diversity: Based on factors external to people’s innate characteristics, such as education, socioeconomic background, marital status, parental status, religious beliefs, and life experiences.
- Organizational diversity: Encompassing the variety of roles and perspectives within a company, including differences in job function, hierarchical level, department, and union affiliation.
- Worldview diversity: Referring to the variety of perspectives and beliefs individuals hold, shaped by their cultural, philosophical, religious, and personal experiences.
Another way to view types of diversity would be visible and invisible diversity.
- Visible diversity: Differences among individuals that are outwardly observable, such as race, age, and gender.
- Invisible diversity: Less apparent personal characteristics of individuals, such as educational background, sexual orientation, and socioeconomic status.
Now, let’s break down some of the types of workplace diversity further.
1. Cultural diversity
Culture refers to a person’s norms and way of life. Cultural diversity in your workplace means bringing people from different walks of life, norms, and values together.
Cultural diversity increases creative and innovative ideas thanks to the employees’ different values and norms.
Challenges
Because every person has a different way of life, cultural diversity can have several challenges. For instance, differences in norms and values can breed distrust and conflict within the organization.
HR tip
Avoid conflicts within different cultures by offering diversity training and through constant communication with employees.
2. Racial diversity
Racial diversity refers to a workplace consisting of employees from different races. Race relates to a person’s physical characteristics, including skin and hair. Race diversity examples include European American or White, African American or Black, Asian, and Native American.
Although we’ve made significant steps toward achieving a racially diverse workforce, we’re still far off.
For example:
- Women of color are the most underrepresented group in the workforce
- 77% of the US workforce is White, according to the Bureau of Labor Statistics (BLS)
- Only 0.4 percent of Fortune 500 companies are transparent about their racial and ethnic diversity efforts.
Racial diversity affords your company a diverse pool of skilled workers. It also promotes social cohesion and allows access to newer markets that represent your workforce’s racial diversity.
Challenges
Although most companies invest in racial diversity, achieving inclusivity is a different ballgame. For instance, people in underrepresented groups get fewer leadership positions. Case in point; only six Fortune 500 companies listed a Black CEO.
In addition, discrimination is still a problem for racially diverse companies. For instance, one in four Black, Latinx, or Hispanic employees reports workplace discrimination.
HR tip
To combat biases, companies should consider blind hiring. This can start, for example, with the removal of personally identifiable information when screening resumes.
3. Gender diversity
Gender diversity encompasses a workforce that’s representative of different genders. Gender diversity calls for more than hiring more of the underrepresented gender. It also requires you to equalize pay, promotions, and learning opportunities.
Gender diversity has two dimensions:
- Gender identity: An individual’s personal sense of their own gender, which may or may not correspond with the sex they were assigned at birth.
- Gender expression: The external manifestation of an individual’s gender identity, typically expressed through behavior, clothing, haircut, voice, and other forms of presentation.
Challenges
Many organizations struggle with making their organizations truly gender diverse. For instance, they may hire more of the underrepresented gender but struggle with equity regarding wages, promotion, and growth opportunities.
For example, by 2023, women’s median weekly wage was 84% of the median weekly wages of men. On the other hand, 86 women are promoted for every 100 men.
What’s more, 42% of women in the US also reported having faced gender discrimination. But we’re making strides in the right direction since nearly half (46.6%) of employees in the US are women.
Of course, women are not the only people that face discrimination at work. You should also look into transgender, non-binary, and gender-nonconforming people to ensure they are not discriminated against.
4. Sexual orientation diversity
Sexual orientation can be defined as an immutable romantic attraction to other people. When discussing sexual orientation diversity, we’re referring to a workforce inclusive of people with different sexual interests. Examples of sexual orientations include heterosexual, asexual, pansexual, bisexual, gay, and lesbian.
An individual’s sexual orientation is a personal matter. However, by fostering sexual orientation diversity, you make employees feel valued and accepted. In turn, employees are more engaged and productive.
Challenges
As many as 40% of employees feel employers are not investing as much in the LGBTQ+ community. Moreover, it’s not uncommon for the LGBTQ community to face harassment and discrimination at work.
5. Linguistic diversity
Linguistic diversity refers to a workforce comprised of people who speak different languages. There are over 350 languages spoken across the US, although English is the predominant language.
Linguistic diversity adds color and uniqueness to your organization. It also gives your organization a chance to serve customers in more personalized ways.
For example, even though English is the predominant language, customers might be most comfortable communicating in another language, such as Spanish. The customer will receive personalized services in their preferred language if you have Spanish-speaking employees.
Challenges
One challenge of linguistic diversity is communication and language barriers within your team. These barriers can affect productivity and make employees frustrated.
6. Socioeconomic status diversity
Socioeconomic status diversity refers to a workforce with different attitudes toward money, education, and social status. This diversity is reflected in the residences people live in, the schools attended, their income, and their occupations.
Like cultural diversity, socioeconomic diversity adds different experiences and perspectives to your company’s operations. The result is more innovation and creativity in the workplace.
Challenges
Differences in your employees’ social and economic statuses can cause prejudice and mistreatment in the workplace.
HR tip
Develop strict ‘fair treatment policies’ across your organization to ensure employees are treated equitably.
7. Geographical diversity
Geographical diversity refers to hiring employees from different locations, sometimes across borders.
This type of diversity exposes your organization to a vast talent pool. It also promotes an increase in different perspectives and problem-solving capabilities.
Challenges
One of the biggest challenges with geographic diversity is the logistical challenges. For example, if you hire an employee in a different country, you’ll have to cater for visa and other logistic requirements. These added expenses can be pretty challenging for a young company.
8. Disability diversity
Disability diversity means hiring skilled employees regardless of any physical and mental disabilities they may be experiencing. It also refers to embracing employees not in spite of their differences but including their different physical and mental abilities.
Employees with disabilities can just be as productive as those without any. They can contribute innovative and creative ideas and bring disruptive change to your company.
Challenges
Many employers may dismiss people with disabilities as not being the standard fit. In fact, 90% of companies say diversity is a priority, but only four percent feel that hiring people with disabilities is part of diversity.
HR tip
Encourage job applicants with disabilities to apply and create programs to support them.
9. Religious and spiritual beliefs diversity
Religious diversity is accommodating employees from different religions (or lack thereof) in your workplace.
Accommodating different religious beliefs can foster more compassion in the workplace. Providing elements such as floating holidays, prayer rooms and allowing the wearing of hijabs and rosaries communicate respect for an employee’s religion. In turn, employees feel a sense of belonging and acceptance, which boosts engagement.
Challenges
Different religious and spiritual beliefs can breed distrust and resentment. However, you can combat this by providing awareness about tolerance and respect for everyone’s religious or spiritual beliefs.
10. Age and generation diversity
Age and generational diversity happen when a company works with employees across all generations. A diverse workplace typically features Baby Boomers, Millennials, Gen X, and Gen Z.
A multigenerational workforce is beneficial for an organization. For example, Gen Z can teach Baby Boomers about upcoming technology. Conversely, Baby Boomers can impart decades-old industry knowledge to the younger generations.
Challenges
Different generations mean different ways of thinking, communicating, and working. If you don’t address and embrace these differences, it could lead to disagreements and communication issues.
Managing diversity in the workplace: Tips for HR professionals
75 percent of companies rated diversity, equity, and inclusion as a priority, according to a Beamery study. Your company can also be part of the change.
Below, we share six tips to manage and improve diversity as an HR professional.
- Foster a culture of inclusion: Your diversity efforts should also be accompanied by inclusion efforts. For example, if you hire more women, ensure they also get the same opportunities for learning, pay, and promotions.
- Provide diversity training: You can develop awareness programs to train employees to tolerate and accept everybody’s differences.
- Try blind hiring: Biases are inherent in hiring, so overcoming them is challenging. You can try out blind hiring, which focuses on an individual’s skills rather than their race, gender, sexual orientation, socioeconomic status, culture, or age.
- Create feedback channels: Establish open, accessible, and safe communication pathways for employees to share their experiences and perspectives on DEIB within your organization. Examples of feedback channels include regular diversity-focused surveys, dedicated email addresses for diversity concerns, scheduled town hall meetings, and facilitated focus groups where employees can openly discuss diversity and inclusion topics.
- Hold everyone accountable: Every employee, regardless of gender, race, religion, age, social status, or culture, deserves to be respected and treated fairly. If they are harassed or discriminated against, you should be ready to hold those involved accountable. It conveys that you care about your employees and do not tolerate discrimination.
- Take an intersectional lens: You need to recognize and address how different aspects of a person’s identity, such as race, gender, sexuality, and socioeconomic background, intersect and impact their experiences and opportunities. This approach acknowledges the unique challenges and biases that individuals may face due to their combined identities, leading to more effective and equitable DEIB strategies in the workplace.
Key takeaways
- Diversity is a company culture trait where the workforce comprises people from different backgrounds.
- Specifically, diversity embraces employees regardless of gender, race, age, disabilities, spiritual beliefs, and sexual orientation.
- Organizations that invest in diversity efforts are more profitable, experience more engaged employees, and have a lower turnover rate.
- Companies can reinforce diversity by providing diversity awareness and working on inclusion and equity in the workplace.
FAQ
There are many types of diversity in the workplace, including innate characteristics such as race, gender, age, and physical ability, and a wide variety of other factors ranging from language and socioeconomic status to job level, union affiliation, and parental status.
There are four fundamental types of diversity: internal, external, organizational, and worldview. Beyond these four types, there is essentially an infinite number of types of diversity, as individuals differ in countless characteristics that intersect with each other in complex ways. These diverse characteristics include but are not limited to factors like race, gender, age, culture, sexual orientation, and life experiences, each interplaying to form a person’s individual identity.
The four basic types of diversity are:
Internal diversity: Race, gender, age, physical ability, ethnicity, and cultural identity.
External diversity: Education, socioeconomic background, marital status, parental status, religious beliefs, and life experiences.
Organizational diversity: Job function, hierarchical level, department, and union affiliation.
Worldview diversity: Variety of perspectives and beliefs individuals hold.
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