Black and Latino workers still earn less than racial counterparts even after going through the same job training program, study finds

Companies still struggle to plug the leaky talent pipeline for diverse hires. The DEI consulting firm Grads of Life recently released an equity and career advancement report, analyzing diverse employees’ sentiments about—you guessed it—career advancement prospects. The findings: Black and Latino employees say even with the same training as their racial counterparts, they lag in achieving significant career milestones like promotions and raises, leading them to look for the nearest exit.

Grads of Life surveyed almost 2,000 workers from Year Up’s workforce development program, which provides tuition-free training for young adults, many of whom identify as racially diverse.

Black workers were more likely than other races to give their employers below-average scores for promotions and raises beyond the cost of living. Only 36% reported receiving a promotion in 2021, while 23% reported receiving a raise. 

Black and Latino workers also reported earning lower average wages than their white counterparts who went through the same Year Up training program, suggesting that “Black and Latino employees may be undervalued once they enter the workforce,” write the report’s authors. For Elyse Rosenblum, managing director and founder of Grads of Life, this is one of the most telling takeaways. 

Though many of the surveyed talent now occupy roles that increased their overall wages relative to if they had not gone through the Year Up program, the disparity in career progression once employed is stark.

“It suggests something is going on in corporate America,” Rosenblum told me. “Even people similarly prepared, once they get into the workplace experience different outcomes. You really have to ask what is going on?”

The answer lies in whether employers prioritize career mobility and actively provide opportunities for internal growth. While more companies are evolving their hiring practices to be more inclusive, Rosenblum says there’s still a tremendous opportunity and need to focus on retention and advancement.

HR leaders play a crucial role in closing this gap, she notes, and must intentionally use wages and benefits to increase job satisfaction among all employees. HR should also track promotions, raises, and salaries across races to better understand and address disparities.

“That’s a baseline starting point,” says Rosenblum. “If you don’t do the disaggregation and measure regularly and transparently against your key metrics, you’re not going to know if you’re inhibiting equality or supporting it.”

Amber Burton
amber.burton@fortune.com
@amberbburton

Reporter's Notebook

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Quiet quitting isn't only keeping CHROs up at night. The phenomenon is affecting CFOs, too, my colleague Sheryl Estrada writes. She spoke with Chipotle CFO Jack Hartung about his concerns. Similar to his HR counterparts, much of Hartung's day is consumed by the restaurant chain's talent strategy:

“A lot of what I’m doing lately is figuring out how we make sure that the labor assigned to the restaurant is deployed in the right position throughout the day between the frontline and our digital make line. Our digital make line is almost 40% of our business…Our food cost and our people cost are by far the largest items on the P&L.”

Around the Table

- Gen Z and millennial women are taking to social media to provide career advice to their peers, who value the informal nature of guidance. BBC 

- Increasing worker productivity could help companies mitigate the effects of inflation. USA Today 

- The service industry drove private sector wage and employment numbers in October, according to payroll software provider ADP. CNBC 

- Political conversations have become a workplace mainstay, and executives feel unequipped to handle them. Bloomberg

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