Employers across sectors have made significant investments in diversifying their workforces over the past few decades. Some progress has been made, though not as much as we would hope. Employees recognize investment, and many say that they trust their employers are working to further these initiatives. But employers shouldn’t take this news as permission to rest on their laurels concerning diversity, equity, and inclusion (DE&I) throughout their ranks. Instead, businesses should seize this moment and continue to capitalize on the momentum they’ve cultivated by reviewing and rejuvenating their DE&I programs.
That means including the ever-growing contingent workforce in their DE&I efforts. Contract, SOW, and short-term arrangements have become increasingly common in the days since the pandemic shook up the global workforce. Between 2016 and 2023, the percentage of contingent workers within a given enterprise labor force grew by almost 50%.
This reliance on contingent workers has helped boost diversity in offices as well as productivity. Still, many employers have yet to consider DE&I for their contingent workforce (CW).
What Inclusion Really Means
Employers’ slow start on DE&I for contingent workers stems from two different but not altogether unrelated phenomena. The first is a lack of experience or knowledge in integrating workers across contract types. That uncertainty drives the second concern: the legal complexities of co-employment. However, extending DE&I practices to this growing population is critical to progress given the demographics breakdown of the group.
Black and Hispanic/Latin workers (13% and 18% of the US workforce respectively) are disproportionately represented in the contingent labor force, comprising 39% and 36% of the total population in 2021 respectively. To put things in perspective, White workers accounted for less than one quarter (23%) of the contingent labor force in 2021 but comprised 77% of the U.S.’ total workers.
Managers must prioritize initiatives that bypass buzzwords and get to the heart of what it means to feel included: to be trusted, heard, supported, and respected. With that in mind, companies looking to ensure inclusion stays a top priority should commit to:
- Flexibility. Many employers have taken “flexibility” to mean the ability to work remotely, and that’s certainly part of the equation. But it’s about so much more than that; it’s about making flexibility a part of your ethos for employees across the extended workforce and communicating that commitment through action.
True flexibility in the workplace means making accommodations based on individual circumstances. For example, single parents—80% of whom are women—may need more freedom to come and go during the day than their partnered peers. For them, inclusion means developing channels for these requests and honoring them whenever possible. It means encouraging workers to be transparent about their needs and not holding those needs against them when opportunities come around.
- Education. No matter how supportive or inclusive a company claims to be, those in the business of hiring know that worker experience inevitably comes down to managers. For DE&I, that seems to be particularly true for Black employees, 80% of whom would leave a job or turn down an offer if they felt their direct manager did not support DE&I initiatives (62% of all respondents shared this sentiment).
Investing in manager training related to the importance of DE&I, the complexity of intersectionality, and the company’s policies can make a big difference in how employees react to efforts.
- Upskilling. Investing in employee growth is a critical part of the DE&I puzzle as it helps keep workers in the fold and builds skills within the workforce. Developing internal mobility programs for both contract and FTEs can show investment in uplifting employees from different backgrounds, show commitment to diversifying leadership in long-term planning, and help employers meet retention goals.
This can also help employees from underrepresented groups understand what might be available to them in the future. Despite their short-term engagements, contingent workers—especially women, people of color, and those with disabilities—often see short-term or frontline roles as a foot in the door.
- Support. Offering support options that extend to contingent workers is also critical to success, as these workers may feel isolated from resources designed for FTEs. While some employers may choose to put a contingent-specific employee resource group into place, they should also encourage short-term workers to get involved in existing, identity-based groups.
Furthermore, leaders may want to take steps to ensure that FTEs treat their contingent coworkers as equals. Many contingent workers report being concerned that full-time coworkers resent their presence in the office, which can exacerbate existing feelings of isolation for women; Black, Asian, and Hispanic/Latino workers; LGBTQ+ employees; and workers with disabilities.
- Communication. Similarly, it’s important to engage with workers across contract types to find out what inclusion and support mean to them. Most companies have achieved the baseline, dictionary definition of “inclusion,” but it’s not a one-size-fits-all concept, as the above illustrates.
While many companies have taken the time to implement channels through which FTEs can share their feedback and thoughts about any number of things, contingent workers often lack access to these resources due to variations in management practices. There’s no way to progress without feedback, so extending access to these workers and really listening to their feedback is critical.
Operational Overhaul
The above strategies can help companies move the needle for DE&I throughout their extended workforce, but leaders will also need to implement new strategies to monitor that progress. To date, DE&I performance and monitoring has been limited to full-time employee data, with the diversity performance of contingent worker programs being judged on supplier demographics rather than actual workers. That means leaders embarking on this journey will need to invest not only in inclusion efforts but in a reimagining of their labor strategy, favoring integration over separation to get a holistic view of performance.
Though the work may feel daunting, research has shown time and again that it’s worth it. Companies that excel at DE&I are more profitable, are more competitive, and have more satisfied workers. In today’s market, successful DE&I programs consider the full workforce—not just full-time staff. This is not the time to back away.
