View from Washington: How unfairness costs tech $16bn a year (part 1)

The first in a two-part deep dive into the Kapor report on how ‘mistreatment’ fuels tech staff turnover.

Recently, ‘View from Washington’ looked at findings from the Tech Leavers Study by the Kapor Centre for Social Impact. It claims to be the first representative analysis of “what drives engineers and other technology workers out the door”.

The report’s headline number is that the annual cost to companies of perceived unfairness or mistreatment of US high technology employees could be $16bn (£12.4bn) as a direct result of staff turnover. Frightening stuff.

Here and (to keep the numbers digestible) in a further post tomorrow, I look at five observations from Kapor’s team that did not make it into print due to pressures of space.

They are:

  1. The whole world (well, 85 per cent) is watching.
  2. Technology workplaces are considered more ‘unfair’ than average.
  3. Our efforts on diversity still have a very long way to go.
  4. Three principles that improve the workplace require backing for five initiatives.
  5. Kapor may have understated the financial cost of the problem.

In Part One, we'll address the first three (though as we are splitting the data and conclusions, look at what follows more like a series of benchmarks than a charge sheet).

  1. The whole world is watching

Kapor found that 37 per cent of its 2,000-worker study cited unfairness as one of the reasons that led them to leave their last job. The finding exceeded those who had simply decided it was time to move on (35 per cent) or been headhunted (19 per cent).

However, another pair of statistics buried in the detail is that 85 per cent of respondents said that they had seen examples of what they called unfairness in the workplace, while 78 per cent said they had experienced it.

It is reasonable to conclude then that even where these issues do not cause staff to quit, they make for a less pleasant, less productive environment.

There is the assumption that tech workers are go-getters. They thrive in an intensive, time to market-driven environment. That may well be true – journalism is another trade where many of its best exponents draw on the pressures imposed by deadlines to do their best work.

But if that many people are nevertheless developing an impression of unfairness, as much as we all might declaim that life itself ain’t fair, it is clear that something is still ticking them off – and in large numbers.

  1. Technology workplaces are more ‘unfair’ than average

Kapor’s ‘control’ research found that the average perceptions of unfairness across all industries runs at 32 per cent of the workforce, but rises to 42 per cent in technology.

This must come as a surprise to managers. Engineering workers are generally better paid and have better benefits packages than those in most other job markets. We might fall back on the long-standing image of engineers as ‘problem solvers’. The profession is staffed by people who take satisfaction from rising to difficult and challenging tasks. This may well be true, so what else is happening?

One important factor likely mitigates this issue for technology.

On one side, it is comprised of more young companies, and these are largely staffed by more highly educated employees. Engineering is also growing faster than other industries, so the number of such staff is proportionately higher.

On the other, there are only so many branches at the top of the tree. A simple calculation will show that you probably cannot promote everyone in your company according to the likely scope of his or her ambitions. So where, as was often the case in Kapor’s research, the perception of unfairness was related to being passed over for promotion, this may be a problem beyond a simple wave of the magic managerial wand.

The 10 per cent disparity though suggests that it is worth looking beyond that inevitability of corporate life.

  1. Our efforts on diversity still have a long way to go

The IET already has the ‘Nine percent is not enough’ campaign to bring more women into UK engineering, so Kapor making this observation about the US should not come as much of a surprise.

But for all that, look at these numbers: women make up 50 per cent of the US workforce, but only 25 per cent of the technology workforce; African Americans and Latinos make up 30 per cent of the national workforce, but only 15 per cent in technology.

Let me now just quote some of Kapor’s deeper observations:

“Nearly one quarter of underrepresented men and women of colour experienced stereotyping, twice the rate of White and Asian men and women. Almost one-third of underrepresented women of colour were passed over for promotion, more than any other group.

“One in 10 women in tech reported experiencing unwanted sexual attention [against 6 per cent in other industries].

“LBGT employees were most likely to be bullied (20 per cent) and experience public humiliation or embarrassment (24 per cent).”

As the saying goes, I'll just leave that there.

More to come

Remember, this should not be seen as a charge sheet though it does seek to be provocative (and we don’t just want to generate reactions from bosses but all you wage-slaves as well).

Then, as noted in the print article, we also need to take account of differences between UK and US business culture. For one thing, anecdotal evidence suggests that British technology workers complain more about underfunding than unfairness. Yet, there has not been a comparable study in Blighty, so maybe we are missing a trick too.

The next article goes into more detail about how Kapor sees technology resolving the staff retention problem, although also how some other new research suggests may be even higher than its $16bn estimate.

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