African American Recruitment & Retention: Show Me the Money!

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According to a National Urban League workplace satisfaction study, African Americans tend to have the least favorable view of their workplace environment—even for diversity best practice award organizations.[1] A common belief among African Americans is that they are, as a group, the last hired and the first fired. They commonly complain about having to endure micro-inequities in the workplace and being past over for job roles they feel qualified to do, yet required to train the less proficient employees who were hired instead.

Managers and human resource officers do not want a single employee to feel undervalued. When African Americans feel under appreciation, many managers feel a sense of having failed to create an inclusive culture. They want to treat each employee fairly but often admit that finding ways to address a sense of inequity among African Americans in the workplace is complex and difficult.

Understanding the African American workers’ needs can offer insights into some of the factors that contribute to a sense of unfairness and inequity. While salary represents only one part of the job satisfaction equation, understanding the financial circumstances of African Americans given historical pay inequity can be insightful. A recent U.S. Bureau of Labor Statistics (BLS) report, Income Spending Patterns Among Black Americans[2], characterizes African American employee wants and needs as reflected in their financial situation.

Some of the Study’s Relevant Findings Concerning African American Household Income

  • African Americans annual income on average is about 70% ($45,287.00) of the national average ($63,935.00)
  • About thirty-five (35%) of the annual African American income is accounted for by those with income in the range of $12,500.00—$37,99.00.
  • Average household contains 2.57 people.
  • There are 1.25 vehicles in a household on average.
  • Most African American households are renters living in apartments or flats with 5 ½ rooms and 1-½ bathrooms on average.

How far does their income go?

  • Their expenditures account for nearly 80% of their pre tax wages ($36,139).
  • Housing alone consumes the largest proportion, which accounts for about 1/3rd of their wages.
  • Transportation and food account for the next highest percentages of expenditures.
  • The remaining 1/3rd includes things like personal insurance and pensions, healthcare, entertainment, cash contributions, apparel, and education.

Income Level Differences Among African Americans

  • High income African Americans make on average about $112,000.00 with a range of $94,000.00—$162,000.00).
  • Low-income households were made up of about 1.9 people while high-income households averaged 3.3.
  • High-income households average 2.1 vehicles while low income accounts for about 0.5 vehicles.
  • Those in the high-income category tend to own their homes while low-income rent.
  • High income households spend about 70% more in expenditures than their lower class counterparts,.
  • Those with high income spend about 1/3rd of their income on housing while housing accounts for nearly half of low-income expenditures.
  • High income African Americans spend more for expenditures overall compared to low income African Americans with one exception—tobacco and smoking supplies. Lower income persons outspent and proportionally outranked their higher income counterparts in this area of consumption.

Lessons from the Data

The workplace is where people aim to make their economic lives better. Income disparities affect perceptions of unfairness and inequities in the workplace. That is because they have real world consequences. Equity in the workplace is influenced by the perception that African Americans as a whole enjoy less income on average than other groups. If an African American worker perceives that black employees are concentrated at the lower levels of the organization with few mobilizing into the higher levels, that is an indication of how inclusive the organization is no matter how many diversity awards it has received. It makes you wonder about the criteria for receiving the award.

The organization that is committed to supporting its employees in meeting life challenges, such as paying the rent or mortgage, will find ways to make their lives a bit easier. It is in the organization’s interest to do so. One financial disaster, such as an unexpected healthcare cost or major car repair, can put strain on an employee in ways that drains energy and rattles nerves. It is too difficult to give one’s all to the organization under such conditions.

A culturally sensitive employee assistance program offers the African American employee a resource within the organization to seek help when necessary. A good example is Wells Fargo Bank employee assistance program, which offers financial assistance along with counseling to support individual workers through catastrophic life events. The organization understands the cost savings for the organization in doing so. Organizations need to put effort into keeping all employees engaged and feeling included.

References

[1] National Urban League (2005). Diversity best practices that work. National Urban League, New York.

[2] Bureau of Labor Statistics (2014). Income and spending patterns among black households. Vol. 3, No. 24.

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