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Regional Assessment: Workplace Diversity, Minority Business Spending in Houston Outperforms National Benchmarks

Published Oct 04, 2023 by Brina Morales

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HOUSTON (October 4, 2023) – Houston companies have advanced on a set of key metrics that measure progress on removing barriers to opportunity for all, according to an analysis commissioned as part of One Houston Together, an initiative of the Greater Houston Partnership’s board-level Racial Equity Committee. The 2023 Houston Regional Equity & Inclusion Assessment highlights practices local employers use to encourage and create a more equitable and inclusive region.

A total of 92 companies and organizations employing more than 265,000 Houstonians across the 12-country region participated in the 2023 assessment with a core group of 64 organizations returning from the 2021 cohort. 

Compared to national trends, Houston performs better on gender diversity, most upward mobility categories, and spending with minority businesses. The 2023 results indicate the representation of Black, Indigenous, and people of color (BIPOC) in the workforce has increased along with the group’s share of workforce promotions over the last two years. The biennial assessment also demonstrated a significant commitment to adopting best practices that advance diversity, equity and inclusion within an organization.

“Houston’s progress across these measures is encouraging. The Racial Equity Committee looks forward to continued movement in the next few years and invites other companies and institutions in Houston to join the effort,” said Gretchen Watkins, co-chair of the Partnership’s Racial Equity Committee and President of Shell USA, Inc. “Houston companies together can help drive action to create opportunity for all Houstonians.”

Key areas of progress highlighted by the assessment include:

Upward mobility

  • Representation of BIPOC in the workforce has increased by 7%, up to 64% in 2023 compared to 60% in 2021. This closely tracks with Houston census data of 67% BIPOC population in the region 
  • BIPOC share of board seats increased by ~13% and the group now makes up ~34% of board seats compared to ~30% in 2021
  • BIPOC share of workforce promotions increased by over 15% going from 52% in 2021 to 60% in 2023
  • Percentage of female new hires has grown by 21% from 54% to 66%, driving female representation in the workforce up to 60%. Additionally, females’ share of workforce promotions grew by 16% from 44% to 51%

Supplier Diversity

  • Initiatives put in place appear to have had a positive impact on supplier diversity, with 25% of organizations setting MBE spend targets; up from 9% in 2021
  • The average number of MBE vendors used by organizations is up 1.7x and is now at ~66 MBE vendors used vs. ~38 in 2021. National average is ~11 MBE vendors
  • In Houston, the average company MBE spend is 5.4% of total budget, compared to 3.6% nationally

Maturity of DEI Practices

  • Houston’s “Maturity of DEI Best Practices” continues to average at “proactive” (46% adoption of best practices) across 15 categories, with several categories’ average at “progressive” (over 50% adoption of best practices)
  • Law and Professional Services industries lead DEI best practices maturity, outperforming other sectors in the Houston region on 13 out of 15 categories

“Since 2021, One Houston Together has brought together more than 120 companies and organizations to offer peer learning and share data-driven insights, industry benchmarks, and best practices,” said LaTanya Flix, the Partnership’s senior vice president of diversity, equity, and inclusion. “The improvement demonstrated by the 2023 assessment results is evidence of the business community’s commitment to this important work, while also identifying areas of opportunity where Houston companies can continue to make progress.”

Despite a noticeable increase in Hispanics in the workforce of ~15%, Hispanics remain the only group underrepresented at all workforce levels. Also, BIPOC share of promotions to senior management positions has dropped by ~40%, from 55% in 2021 to 33% in 2023. The results also indicate a slowdown in the promotion of women into senior roles and board seats. Despite supplier diversity progress, only 51% of those surveyed report MBE spend, so those reported figures may not be representative of what is occurring across the regional economy. 

See full assessment results on an interactive dashboard.

View video below for a recap of the results.

About One Houston Together
One Houston Together galvanizes Houston-region business leaders to drive change in two areas where the Partnership believes the business community can have the greatest impact – creating pathways for talent advancement and leveraging our buying power. By addressing these issues at a regional scale, Partnership members can measure individual and collective progress over time, identify focus areas and reinforce their shared commitment to removing obstacles to equal opportunity.
Partnership members participate in Talent and Supplier Diversity Roundtables, Talent Talk, Houston Buyer Cohort, CPO Convening, and industry working groups. 

About the Houston Regional Equity & Inclusion Assessment
Initially launched in 2021, the biennial Houston Regional Equity & Inclusion Assessment is the first of its kind among major U.S. metros, measuring respondents’ progress on workforce and leadership race and gender diversity, supplier diversity spending, and 15 DEI best practice categories. A total of 92 companies and organizations employing more than 265,000 Houstonians across the 12-country region participated in the 2023 assessment. Boston Consulting Group provided the assessment analysis and reviewed national trends to provide context for the Houston data. Assessment respondents represent the broad spectrum of public and private organizations across key industries operating in Houston. The assessment is based on the Global DEI Benchmarks and used by other economic development organizations across the U.S.

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