David Fairhurst: ‘Drop D&I now and face talent shortages in future’

David Fairhurst is former global chief people officer at McDonald's

Organisations that drop diversity and inclusion initiatives during the coronavirus crisis could risk ‘re-marginalising’ disadvantaged workers and face talent shortages in the coming years, a prominent HR practitioner has warned.

Talking exclusively to Personnel Today, David Fairhurst, former global chief people officer at McDonald’s, believes young people, older workers and people from other underrepresented groups – who have benefitted in recent years from inclusion initiatives – could be “pushed back to the fringes of the world of work” if employers withdraw these programmes because they feel they are not an immediate priority.

Shortly before the Covid-19 pandemic hit, employment in the UK hit a record high of 76.3%, and D&I initiatives were helping to expand pools of talent for employers desperate to find staff.

Fairhurst had predicted this “workforce cliff” would happen in 2014 in an interview with the Financial Times: that declining birth rates and the departure of older workers from the jobs market would lead to acute labour shortages that would hamper economic growth.

This will still happen, he argues, and “the faster the recovery, the faster the challenges of labour supply and demand will return”. Organisations that have continued to invest in diversity or outreach programmes during the pandemic will have a “significant competitive advantage”, whereas those who did not “risk falling into a talent trap they will struggle to escape from”.

Initiatives at risk

However, diversity consultant Stephen Frost, CEO of Frost Included, believes the evidence is that the former is happening, rather than the latter. He estimates that almost three-quarters of UK companies have either cancelled or postponed their D&I programmes. A recent survey by diversity network d&i Leaders also reflected concern among four in 10 D&I professionals that diversity would fall off the agenda at their organisation.

At McDonald’s, Fairhurst was involved in a number of pioneering schemes to widen access to the labour market: it adapted its practices and recruitment pipelines to suit older workers, for example; it was one of the first UK employers to offer employer-accredited training; and in Germany offered workplace language lessons to attract migrant workers.

And while these were socially responsible initiatives, they also helped to build a pipeline of employees in a talent market that was fast contracting.

He believes that the coronavirus has not taken away the risk of employers reaching that workforce cliff he predicted six years ago – it has simply delayed it.

“We looked at labour growth and the number of vacancies and believed the lines on each axis were due to come together in the UK in mid-2020 – but then the virus happened,” he told Personnel Today. “Depending on what sort of recovery we have, it’s likely to be over a three-to-five year period and that workforce cliff is still chugging along and going to happen.”

Coupled with a reduction in migrant labour thanks to Brexit labour restrictions and post-Covid reluctance to move between countries, employers will again face acute talent shortages. Even where outreach programmes have moved online, this may defeat the purpose in some cases.

“It’s a workforce availability issue. If we lose these people now it will cause problems in a relatively short space of time.”

Susan Reichle, CEO of the International Youth Foundation, which has just launched a Global Youth Resiliency Fund, believes pushing inclusion programmes online does nothing for those who face difficulties accessing those resources.

She says: “There has been a significant shift by organisations to online delivery of programmes which is creating a barrier for young people who might not have up-to-date computers or might be struggling to pay for internet access.

“These are the young people whose leadership we need to seize our future. As a society we cannot afford to leave them behind.”

Heroes and villains

Fairhurst, who left McDonald’s at the end of 2019, is the founder of a new consultancy called OrgShakers and is keen to support organisations to engage with under-represented groups, enhance employee wellbeing and ensure that D&I strategies remain firmly on the agenda.

He is working with a group of associates including former Tesco Bank people director Therese Procter and Maya A Bordeaux, former HRD of US publisher Tribune Publishing, as well as experts in HR transformation, data insight and engagement.

Fairhurst also advises companies such as Wagestream, which has built a system that enables staff to access earned wages before payday, the IYF, Frost Included and Rest Less, an organisation promoting jobs and opportunities for the over-50s.

He understands why organisations might be reconsidering investments in D&I now when revenues are squeezed and resources pushed. But it’s important to consider the long-term consequences, he adds.

“It’s a workforce availability issue. If we lose these people now it will cause problems in a relatively short space of time – maybe the next two-to-three years.” Withdrawing support now to save relatively little money will only mean they need to re-invest in widening their talent pools in future.

He also supports a growing argument that organisations will be perceived as “heroes or villains” based on how they treated employees and customers during the pandemic. “It’s easy to stop a programme for women returners, for example, but how will those people feel about that employer versus the one that kept investing in that programme? The ones that keep them will be rewarded with loyalty.”

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