Workplaces diversify, then eye corner office

More minority students graduating from colleges and universities than ever before. A boom in entrepreneurship among African-Americans, Hispanics, and Asians. More wealth spreading throughout the economy, into nonwhite homes. Hundreds of millions of dollars spent by corporations to recruit and develop minority employees.

Judging by those changes, you'd think the US were making progress with diversity in the workplace. And it has been.

But even as experts assess the gains that have been made, particularly in the past decade, they are sounding a warning bell that rings from the halls of academia to the hustle of the workplace: Diversity is not a done deal.

Recent studies show that the US still has far to go if it is to develop a workforce that reflects, from top to bottom, the changing demographics of the country. At stake, they say, is America's competitive edge in an increasingly global marketplace with a customer base that is increasingly nonwhite.

"A lot of the conversations around diversity-training in some ways are missing the point," says Carl Van Horn, director of the John J. Heldrich Center for Workforce Development at Rutgers University and co-director of a survey on perceptions of race and discrimination in the workplace.

"It really isn't about training people to be aware of others, though that's not a bad thing," he says. "But ultimately [that's] not going to solve the problem." Correcting a lack of diversity, says Mr. Van Horn, ultimately calls for "action, not awareness."

Education and nonprofit organizations that track and encourage minority participation in business say that action has to come on many levels: persuading more minority students to sign up for undergraduate and graduate business-degree programs, increasing the diversity of business school faculties, and increasing their numbers in senior management positions in companies across the board.

Experts say that change needs to come primarily through two avenues: the classroom and the job.

A recent study by the Diversity Pipeline Alliance, a coalition of 11 national business and education groups working to increase minority representation in business, found that in the 1990s, minority students "walked away in droves" from undergraduate business programs.

The decline mirrored a similar decrease among white students, but the alliance was particularly concerned about minorities because they continue to be underrepresented in the business field. According to the report, minority students were choosing other programs – such as medicine, education, or life sciences – at three times the rate they were pursuing business degrees.

Nicole Chestang, chief operating officer and secretary of the Graduate Management Admission Council, the alliance's lead sponsor, says her coalition plans to dedicate itself to better educate minority students and their parents about what a career in business actually means.

"If we're interested in having a diverse class in the next decade," she says, "we need to start today. We need to educate young people about the opportunities involved and the required preparation to get there. We need to excite them about the benefits and the rewards."

Experts say that part of the way to increase minority interest in business-school programs is to increase the number of minority professors on campus – a total that currently stands at less than one minority professor per four-year school nationwide.

Since 1993, The PhD Project has worked to attract qualified minority workers back into academia to earn the doctoral degrees necessary to become a university professor. It has done so with strong support from corporate America.

"I say: 'Folks, there's no enemy out there,' " says Bernie Milano, founder and administrator of the project, which is part of the New Jersey-based KPMG Foundation, established in 1968 to improve business higher education. "Schools have been giving us money, and corporate America is giving us access to their minority employees, realizing it's likely they'll lose some of their best workers [to academia].

"But they understand it's more important to have a person in front of a class for 20 to 30 years, affecting thousands and thousands of people," he says.

The project grew out of a concern Mr. Milano found among corporate recruiters: that they simply were not finding enough qualified minority students to hire. In researching the reasons why they weren't pursuing business degrees, says Milano, one thing was clear: There weren't enough role models.

"If you don't have natural mentors available," he says, "then it's difficult to draw people into specific areas. We felt it was a real deterrent."

The PhD Project spreads the word through annual conferences and constant contact with universities and businesses. Since the project began, says Milano, more than 30,000 students have asked for more information about the program. The group's efforts seem to be paying off: Currently, according to the project's figures, there are 596 minority faculty members in the US, up from 294 in 1994. There are an additional 406 minority students in doctoral programs today. If those students all become faculty members, the number of minority professors will triple by 2006.

But even with increased numbers of minorities in business schools, experts say that substantial change still needs to occur in the workplace. Specifically, they say, there is a need for more minority role models at the top. Currently, less than handful of Fortune 500 companies are run by people of color – with American Express and Federal Express as notable examples of minority leadership.

"I think significant strides have been made in the workforce in general, but we're still light years away from those strides being the same at the top," says Mike Hyter, president and CEO of J. Howard and Associates in Boston, which helps firms find and remove internal obstacles to providing greater management opportunities for minorities and women.

"The base of workers and employees has significantly shifted, and is much more reflective of the demographics of the country around us," he says. "But there is still this wall limiting progress toward where the opportunity to lead is made available to women and people of color."

Experts say the changes needed will be tough to make, because management promotions within a company often have a lot to do with more subtle areas of personal relationships than with specific training programs. And, they say, because the large-scale civil-rights protests of the 1960s are largely a thing of the past, employers may not realize the extent of discontent minority workers may be feeling.

In fact, according to Mr. Van Horn's recent survey, whites and minorities have sharply different perceptions about how minorities are treated in the workplace.

Among the survey's findings was the fact that 94 percent of white workers surveyed believe that employment practices in hiring, promotion, salaries, a safe working environment, and assignment of responsibilities are fair to all workers. Nearly half of African-American workers, and 12 percent of workers of other races, say they are not treated fairly.

"I think it shows how race is still a very powerful and contentious issue in our society," says Van Horn, who says that the center's website has registered 15,000 downloads of the free report since it came out in mid-January.

"I think there is a momentum for change," he says. "To me, the pace is frustrating. I think it's too slow."