Companies frequently focus on racial diversity in their hiring practices. But hiring is not enough—retention is critically important. And the composition of teams at work can impact that retention in surprising ways.
Evidence from a new study suggests that Black women in teams with a greater number of white peers may have worse job outcomes. This finding may offer a starting point for improving retention and diversity in elite firms.
Elizabeth Linos, the Emma Bloomberg Associate Professor for Public Policy and Management, and colleagues Sanaz Mobasseri from Boston University and Nina Roussille from MIT studied 9,037 inexperienced new hires in a large, elite professional services firm from 2014 to 2020, focusing on the effect of the racial makeup of coworkers on employees’ turnover and promotion.
The researchers examined administrative employment data and billing records over the course of those seven years for Black, Asian, Hispanic, and white women and men. Studying retention and promotion rates, they saw that the largest turnover gap was between Black and white women, at 8.9 percentage points. In addition, Black women were the only group whose turnover and promotion were significantly affected by the racial identity of their coworkers. The study found that a 14 percentage point increase in the share of white coworkers was associated with a 10.6 percentage point increase in turnover for Black women. Linos and her colleagues write, “No other employees of color, even similarly sized numerical minorities such as Black men or Hispanic women and men, were negatively affected by their initial white coworkers.”
