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Attacks on Diversity, Equity and Inclusion Have Consequences

The social and political landscape has felt like a roller coaster since the early days of the pandemic. A steady stream of soundbites evoking fear, anger, uncertainty about fact and fiction, and a general distrust of the systems in place to serve us - government, education, science - have created a situation where elected leaders make decisions based on personal beliefs over sound policy. 


The steady erosion of programs and support for Diversity, Equity, and Inclusion has picked up pace in several states and resulted in legislation that I believe will have profound consequences that their sponsors either ignore or choose not to share with the people they represent. 


Three Areas to Consider 


Economic Loss


In April, Kansas lawmakers enacted their first anti-DEI legislation aimed at colleges and universities, while Missouri lawmakers are still working to advance similar legislation despite strong opposition from a host of groups including the Missouri State Chamber of Commerce


A study by The Perryman Group estimated that anti-DEI policies could cost Missouri $2.6 billion in annual gross product and 23,842 jobs by 2030. In Kansas, the projected losses are $898.4 million and 8,462 jobs. These losses are attributed to decreased travel, tourism, and business investment due to perceptions of discrimination and intolerance.


Companies may hesitate to locate or expand in states with anti-DEI laws due to concerns about discrimination and a hostile environment. This can lead to a loss of potential jobs and investment, as businesses seek out more welcoming and inclusive locations. In addition, negative publicity resulting from anti-DEI policies can also damage a state's reputation, making it less attractive to tourists and potential residents.



Loss of Talent and Skilled Workers


The Texas legislature was an early critic of DEI measures - SB 17 was passed during the 2023 legislative session and prevents public colleges and universities in Texas from having diversity, equity, and inclusion (DEI) offices or policies.


At a hearing to discuss how the law has been implemented, University of Texas (UT) System Chancellor James B. Milliken spoke to the impacts of the law. According to reporting from KXAN, “Milliken testified UT’s 14 institutions completed internal audits, which led to shutting down 21 DEI offices, getting rid of 311 positions and canceling 681 contracts.” In addition, several reports noted faculty departures over the legislation. 


Studies have shown that diverse teams are more innovative and profitable. BCG’s study on diverse management teams notes a 19% increase in innovation and revenue. Anti-DEI policies can hinder efforts to recruit and retain diverse talent, limiting a state's ability to attract innovative companies and industries. A less diverse workforce can lead to missed opportunities for growth and economic development due to a lack of diverse perspectives and ideas.


Restricting DEI efforts in schools can hinder students' ability to develop the cultural competence and critical thinking skills necessary for success in a globalized economy. While I view this as a negative, it is not a far stretch to think that many of the supporters of these laws are actually hoping for this outcome. 


Limiting Free Speech


Alabama's anti-DEI law, Senate Bill 129, was signed into law in May 2024 and is set to take effect on October 1, 2024. This law significantly restricts diversity, equity, and inclusion (DEI) efforts in public institutions within the state.


The law includes:


Elimination of DEI Offices and Programs:


  • Public colleges, universities, and state agencies are prohibited from establishing or maintaining DEI offices.

  • These institutions cannot sponsor or promote DEI programs that advocate for certain "divisive concepts."


Restriction on Bathroom Use:


  • Students in public colleges and universities are required to use bathrooms that align with their biological sex assigned at birth.


Definition of "Divisive Concepts":


  • The law defines "divisive concepts" broadly, encompassing ideas that suggest one race or sex is superior to another, promote discrimination, or advocate for collective guilt based on race or sex.


While this law is primarily aimed at educational institutions and state agencies, it could have a sweeping impact and serve as a gag order for anyone wishing to discuss the disparities that exist in a community, their cause, and how to address them. This may include consultants who work in Alabama communities that are trying to help create more equitable growth.  


Fortunately, there is legal action that is holding up the implementation of this law but it is difficult not to see the impacts as programs operate in fear over future retribution based on the sweeping nature of the law’s language. 


The economic and social impacts are not fully known as most of these state laws are still pending implementation or were implemented earlier this year. What is known is that leaders in these communities have staked out positions that leave little doubt about how they view tolerance and empathy or the economic health of their constituents in favor of personal beliefs.


 

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