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Workplace Racism is Costing Billions in Lost Productivity Each Year, New Research Shows

Workplace Racism is Costing Billions in Lost Productivity Each Year, New Research Shows

New research from the Society of Human Resources Management (SHRM) is highlighting the costly impact of workplace racism.

According to a new SHRM report, The Cost of Racial Injustice, 48% of American workers who experienced unfair treatment on the job called in sick or missed work last year due to anxiety and stress stemming from those experiences.

Even workers who were not treated unfairly themselves suffered. 10% of American workers surveyed admitted to calling in sick over the past year from stress and anxiety caused by witnessing unfair treatment of their coworkers.

The report estimates that the cost of absenteeism and productivity loss totaled nearly $59 billion in the last year alone. It also estimates that employee turnover due to racial inequity in the workplace has cost U.S. organizations up to $172 billion over the past five years.

“SHRM has consistently challenged leaders in the workplace to have open and honest conversations with their peers and teams about bias, discrimination and racial inequity, and then turn those conversations into concrete action,” said SHRM President and CEO Johnny C. Taylor, Jr. “The path to equity is shared, and it will take the collective efforts of HR professionals, C-suite executives, People Managers, and employees to create workplaces where inclusivity, empathy, and respect are the cornerstone of culture.”

Workplace Racism: From Conversation to Change

In the summer of 2020, SHRM launched Together Forward @Work, a call to action for the HR profession and business community to drive racial inequity out of U.S. workplaces. It has also created the DE&I Action-to-Change Toolbox for organizations to spur real, lasting change, including resource guides, conversation starter cards, and a step-by-step guide to support inclusivity, reduce bias in hiring, and create safe spaces at work.

Methodology for the Cost of Racial Injustice: A sample of 1,313 American workers, which included an oversample of Black, Hispanic/Latino, and Asian respondents, was surveyed using the AmeriSpeak Omnibus, NORC at the University of Chicago’s probability-based panel. The survey was administered Thursday, August 27 to Wednesday, September 3, 2020. Data was weighted to reflect the U.S. adult population. Cost estimates were calculated using a combination of data from SHRM’s 2021 Cost of Racial Injustice survey and BLS data.

Methodology for Empathy: DE&I’s Missing Piece: A sample of 2,496 American workers was surveyed online from March 10, 2021 to April 5, 2021. Respondents were sourced from Lucid. Data was collected using quota sampling on gender, age, race, education, census region and industry and was weighted to be representative of the American working population. Data is reported for those expressing an opinion (agree/strongly agree, disagree/strongly disagree as applicable).

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