Diversity and Business in the United States
The demographics of the United States are changing at a rapid pace and consequently we are observing a “transformation in the culture and buying habits of this nation.” (Robinson, Pfeffer, & Buccigrossi, 2003)
As a result, historically small niche markets are gaining an increasing prevalence within the U.S. marketplace and have substantially higher buying power. If companies are to continue to thrive in this modern economic environment they must be able to recognize and understand the implications of these demographic shifts. This includes the ability of a company to improve marketplace understanding as well as to implement business practices that will retain a diverse and talented workforce.
The change in demographics within the U.S. has been described as an increase in diversity, but how exactly is diversity defined within the business community? “Companies competing in today’s fast-paced global market tend to favor the broadest definitions of diversity—differences in gender, racioethnicity, age, physical abilities, qualities and sexual orientation, as well as differences in attitude, perspectives and backgrounds.” (Robinson, & Dechant, 1997) Over the past 25 years we have seen an increase in the representation within the American population by ethnic minorities. It is estimated that by the year 2040, half of the American population will belong to a group currently considered to be an ethnic minority! These, in combination with other demographic shifts within the American population, are changes which simply cannot be ignored.
Changes within U.S demographics have led to the development of emerging markets of new customers. As these new customer bases continue to grow we will see a corresponding increase in their respective buying power. For example, research performed by the Selig Center for Economic Growth at the University of Georgia has found that “the buying power of people of color has grown dramatically over the past decade. The combined buying power of people of color in the U.S. grew from a base of nearly $600,000 billion in 1990 to approximately $1.4 trillion in 2001.” (Robinson, Pfeffer, & Buccigrossi, 2003) Other developing and emerging markets that are on the rise in the United States include the gay , lesbian, bisexual, and transgender (GLBT) community, people with disabilities and women. Multiple studies of these groups have confirmed the increase in collective buying power from these groups. Companies on the forefront of tapping into these markets are already adapting their business strategies to target these customers and their efforts are proving to pay off in spades. For instance, marketing programs aimed at people with disabilities can target one out of every ten consumers not to mention the fact that people with disabilities come from various ethnic backgrounds and age groups etc. (Robinson, Pfeffer, & Buccigrossi, 2003) As these groups continue to gain strength in...