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Massachusetts Economy: Building a Future of Inclusion

Posted on January 7, 2023

by Karen Wallace

Massachusetts has historically been in the vanguard of movements to provide equality and respect to all citizens. The commonwealth was among the first to embrace universal health care, same-sex marriage, and most recently, the first women LGBTQ governor.

But the commonwealth has been slower to embrace diversity, equity and inclusion. Much work remains to be done to ensure that all businesses and citizens can share in the economic prosperity of Massachusetts.

Consider the following:

  • Minority owned and managed businesses continue to remain at the bottom when it comes to lucrative business contracts. Minority owned businesses were awarded only 3 percent of state government contracts in 2021, and Black and Brown businesses received the smallest share of those contracts.
  • Hispanics and Blacks continue to reside at low end of a yawning economic wealth gap. Massachusetts, the second wealthiest state in the country, suffers the sixth largest racial wealth gap in the U.S.
  • Women in Massachusetts still earn an average of 81 cents for every dollar that men make.  The gap is even larger for female Black Indigenous People of Color (BIPOC)—Native American women earn 59 cents for every dollar that a White male earns. Black women earn 57 cents and Latino women earn 51 cents.
  • In Boston, a large share of LGBTQ+ youth of color are unemployed (33%), unstably housed (16%) and food insecure (31%)

The picture is not wholly bleak. The commonwealth has made progress with initiatives like Boston’s Sheltered Market Program, which allows state and local governments to reserve certain contracts for minority and/or women-owned businesses and the 100% Talent Compact which is focused on eliminating the gender and racial wage gap.

Nevertheless, the demographic tides in the commonwealth are shifting rapidly and the Massachusetts business community must increase the velocity of change in this area in order to remain attractive for employers and employees.

Massachusetts can distinguish itself from competitor states by addressing disparities that limit people from participating in the workforce at equal rates. Creating opportunities positively impacts consumer consumption, investment and economic growth. Massachusetts wins when the business environment is equitable and inclusive.

We know these efforts work because we know how valuable minority owned businesses (MBEs) are to the economic health of the country:

  • Certified MBEs in the United States generate $400 billion in economic output, leading to the creation or preservation of 2.2 million jobs and $49 billion in annual revenue.
  • In 2019, US women-owned businesses employed more than 10 million workers and accumulated $1.8 trillion in profit.
  • LGBTQ enterprises contributed $1.7 trillion and 33,000 jobs to the US economy.

Massachusetts employers are struggling to find qualified talent to meet demand. Recruiting and retaining employees will not get easier going forward. Attracting and retaining talent will come down to having attributes that resonate with employees and make them both loyal workers and advocates for their organization.

Gen Z  – defined as those people born in the late 1990s to early 2010s – will make up 30% of the working population in just seven years.  These individuals are driven by a sense of purpose. They are looking for fulfillment from their employment. They are demanding that their employers be aligned with their personal values, including values of diversity, social justice, equity, and all forms of gender identity.

According to survey by Tallo, roughly one-third of respondents reported that they did not apply for a job because they feared unfair treatment or discrimination. Conversely, almost 70% of Gen Z respondents said they’d be “absolutely” more likely to apply to a job with a company whose recruiters (and marketing materials) reflected a more racially and ethnically diverse workplace.

What can employers do to ensure they are making the necessary strides to advance DE&I within their organizations and attract the talent of tomorrow? Several AIM members are setting the bar high:

  • At Eastern Bank , DEI is part of the company culture, as codified in the vision: “We envision a thriving regional economy and community where economic hierarchies are dismantled and systems of oppression based on race, ethnicity, gender, gender identity, parental income, ZIP code or other elements of difference and resulting disparities are eliminated so that these distinctions are no longer predictors of economic outcomes for our neighbors.”   The bank has data to prove that its approach is working – women fill 48% of bank officer roles and minorities accounting for 20% of the overall workforce.
  • Blue Cross Blue Shield of Massachusetts is working to address health inequities in marginalized communities. The insurer is also creating economic opportunities through its supplier Diversity Program to ensure greater use of minority owned suppliers. Blue Cross partners with minority, women, LGBTQ, veteran, and disabled business owners who bring unique experiences and perspectives to the business, and support our diversity, equity, and inclusion objectives.
  • Acadiasoft has focused on creating a consistent internal conversation around diversity, equity and inclusion which includes a Statement of Principles governing all hiring and board appointments, a focus on global inclusivity capturing the voices of those for whom English is a second language and ongoing communications across the organization to insure that everyone feels comfortable and confident to discuss the highly sensitive issues related to differences and inclusion.

AIM applauds these members and many others who are stepping up to do what it takes to attract talent by doing what is right to achieve diversity equity and inclusion.

AIM believes the business community has a responsibility to contribute to the economic engine of the state and also to be a force for good.  Being equitable and inclusive with diverse individuals and organizations is not just the right thing to do – it is the business imperative of this decade if we are to remain attractive to employers and employees and maximize the economic success of the state.

We will continue our efforts to create a more diverse, equitable and inclusive organization that represents the full variety of businesses and business people in Massachusetts. We hope you will join us in these efforts.