Transcript
Mark:
Welcome to PeopleTech, the podcast of the HCM Technology Report. I’m Mark Feffer. Today I’m joined by Samantha Friedman, the Senior Vice President of People Strategy at Hired. She spends a lot of time thinking about what’s going on in the world of tech employment. Hired does research in the area too. So we’re going to talk about the state of DEI and technology, good news and bad news for underrepresented groups and the impact of salary, transparency. All that, and more on this edition of PeopleTech. Hey Samantha, to start off, could you tell me about Hired? What do you do and how do you do it?
Samantha:
Sure. So Hired is the most efficient way to fill tech and sales roles today. So we have unbiased insights, DEI tools, skill assessments, a dedicated team of customer success manager, and we work with over 10,000 companies around the world to match thousands of active and qualified candidates to employ their full potential. So with better data and curated matches and higher acceptance rates, employers save an average of 45 sourcing hours per roll, which we know equates to a lot of dollars, right? It’s very exciting. So our vision is to make the hiring process more equitable, efficient, and transparent, and we work towards that vision by creating tools that enable this. So think faster, more efficient matching, DEI tools that are reducing bias, salary, transparency. And we provide resources such as quarterly reports to keep both candidates and employers on our platform up to date on key hiring and job market trends.
Mark:
So Hired recently released a report about wages in the technology industry, and could you tell me its highlights?
Samantha:
Absolutely. I think in looking at this year’s report, I had three big takeaways. The first, unfortunately we saw a trend over the past 12 months of a deprioritization of DEI programs and the scaling back of DEI teams. And according to our survey respondents, they feel that there is a continued risk for cutbacks in the future if the economy continues to tighten. The second thing that we saw is that the opportunity gap still remains an issue. And what I mean there is that the difference between employment opportunities for different groups of people. And so while companies have increased interview requests, or what we call IVRs, to underrepresented groups over the past few years, think 2018 to 2021, we still are seeing a representation issue for non-male, non-white individuals.
So in 2022, we still saw 38% of positions only submit interview requests to men. And this actually increased from 2021, a percentage point. And then in 2022, we also saw 12% of positions only send interview requests to white job seekers. However, we are seeing this steadily drop year over year. It was at 26% in 2018. And then I think the third takeaway is that underrepresented groups have made significant progress in 2021 regarding the wage grant, but it again widened for the majority of them, with the exception of white and Asian women. So Hispanic men, Hispanic women, Black men, Black women, all saw widening wage gaps.
Mark:
One of the things the report looked at was the impact of salary transparency regulations, and it said they’re correlated with improved representation for women and reduced wage and expectation gaps. Can you expand on that a bit and did it surprise you?
Samantha:
So we weren’t surprised that salary transparency legislation led to increased representation and pay equity in respective markets. So we continue in our reports to find that there is a close link between the expectation gap and the wage gap for underrepresented groups, which can be alleviated through greater overall transparency into wages. Job seekers in states that have salary transparency laws, we found posted salary bans make a bigger difference to women and that they’ve also revealed that many job seekers are compensated less than their market rate. So in our findings, right, 61% of women said it saved them time, it made the negotiation process easier, while 58% of men agreed to that. While a little over half of our job seekers acknowledged their salary is within the ranges posted, nearly 40% of total respondents also indicated they’re making less than the disclosed salary ranges.
Women in the San Francisco Bay Area really saw the highest improvement from salary transparency legislation. So pre legislation, the wage gap was 95 cents to the dollar. Post legislation, it was a $1 and 2 cents to the dollar. So the pay transparency law also seemed to reduce the under-representation of women in California as well. So women in the San Francisco Bay Area became overrepresented in the timeframe that the law was in effect while women in LA saw about a 15% reduction in under-representation. Now, similarly, women in New York City, we saw a about a 12% increase in representation after the law took effect, as well as improvements in the gender expectation and wage gap. So both narrowing from 97 cents to 98 cents to the dollar respectively.
Mark:
Stepping back for a second, just thinking about DEI broadly, that it feels like not that long ago there was a lot of discussion going on about DEI, but now especially after the pandemic, it seems like that whole discussion has gotten quieter. Am I right about that or do you think those conversations are just continuing without getting so much attention?
Samantha:
No, I think you’re right. So I think unfortunately, and we’ve seen this in other markets, DEI has fallen as a priority for many workplaces in spite of the pledges and commitments that they’ve made in 2020. So in our report, 20% of survey respondents said that they have seen or they are scaling back their DEI teams. And then 12% of these respondents also said that they can see future cutbacks as the economy tie-ins as well. I think in a wake of the Supreme Court’s decision on affirmative action, DEI is paramount for companies to increase representation for marginalized groups. We have a responsibility to create diverse and well-rounded workforces, and there’s ample evidence that shows that inclusive workplaces perform above homogenous companies and are more likely to actually attract quality talent.
Mark:
The Supreme Court had a recent ruling on affirmative action and education and basically it eliminated it. And that’s kicked off a talk about a similar action being taken possibly in the business world. Are employers thinking about that possibility or are they concerned about it?
Samantha:
I think that the Supreme Court’s recent decision is going to, and if not already, impose further barriers for corporate DEIB commitments, which I’ve been saying we’re seeing eroding as we speak. Interestingly, in California, the ban on affirmative action will create insurmountable opportunity gaps for underrepresented groups who had benefited most from access to selective networks and higher education. So there was an analysis that was performed on the state span on affirmative action, which showed pay disparities widened 5% for people from less privileged backgrounds who benefit from education and networks and resources offered by selective universities. And I think employers must remain firm to their commitments and actively address bias in their organizations. So this could include providing full salary transparency, thinking about how are we educating our leaders on ways to recognize and report bias? Definitely reassessing how cultural fit requirements may impede DEIB efforts because it’s alienating our underrepresented and qualified candidates.
Mark:
I’d like to change subjects a bit. The labor market seems more competitive now than it’s been in a really long time. And the tech market in particular seems to be getting more and more volatile. What’s your view about the state of tech jobs right now?
Samantha:
In 2023, we’ve just seen a wake of mass layoffs in the industry and there’s definitely market instability and we are seeing the job market continue to tighten, especially for tech talent. That being said, I think that we are encouraged by the uptick in a number of open roles on our platform for specific positions within the tech world, such as AI and machine learning engineers, hardware designers, and IT professionals.
Mark:
Can you expand on that a little bit? Because I was thinking about the whole impact of AI, which seems to have become a tidal wave over the last seven or eight months. How’s that impacting the whole job market in tech? I know there’s a lot more companies looking for AI expertise, but I keep wondering if that AI expertise is really out there.
Samantha:
No, I think we will see an increase of companies using AI for recruiting reasons, to try to help optimize different job flows, things that can be making work processes more efficient.
Mark:
I think really what I just wanted to ask is there’s this increasing demand for AI professionals, professionals who know their way around AI, and I’m wondering what impact that demand is having on the overall labor market for technology pros.
Samantha:
Yeah, I don’t have the specific data and we can get that, but I do know that as a lot of tech positions have been impacted by this tightening market, the one area that we are seeing excitement by employers, we are seeing an uptick in positions is AI and machine learning. And I think because AI has been so much in the media, has been in the news, the launch of chat GPT, there is a desire from employers to figure out how do we leverage this? And I think many companies feel like by having AI engineers within their teams, they are going to be able to have those efficiencies, find those synergies within their work. And that’s why we’re seeing an uptake of positions. I definitely think the engineers are out there, we see them on our platform and we’re excited by them.
Mark:
So all of these dynamics with the tech labor force and demand for tech professionals, what has it meant for Hired’s approach? Have you had to do any course correcting or do you feel like you were prepared for everything and you’re just moving along?
Samantha:
I think our commitment is to helping job seekers that may have been impacted by volatility find roles that are best suited for their skills, interests, and experiences. And quite frankly, we’re here to do that regardless of the market conditions. And we will continue to do so both in the booming market that we saw in 2021 to tightening conditions that we see today.
Mark:
Well, Samantha, thanks very much for taking the time to talk with me today. I know you’re busy and I appreciate meeting you and talking with you.
Samantha:
It was a pleasure. Thanks so much for having me.
Mark:
Today I’ve been talking with Samantha Friedman, the Senior Vice President of People Strategy at Hired, and this has been PeopleTech, the podcast of the HCM Technology Report. We’re a publication of Recruiting Daily. We’re also a part of Evergreen Podcasts. To see all of their programs, visit www.evergreenpodcast.com. And to keep up with HR technology, visit the HCM technology report every day. We’re the most trusted source of news in the HR tech industry. Find us at www.hcmtechnologyreport.com. I’m Mark Feffer.
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