Wall Street has a diversity problem. Black banks have a longevity and capital problem. So just how big are these problems, and what’s getting better?
1. Go up in rank and diversity goes down
In the US, there are 3.6 million workers at finance and insurance companies with at least 100 employees. Data collected by the US Equal Employment Opportunity Commission (EEOC) shows that racial diversity decreases as you move further up the corporate ladder.
Quick housekeeping note: Companies report demographic data to the EEOC, they generally groups employees into four levels:
- Other: Technicians, sales, administrative support, and other roles that typically require minimal training.
- Professional: Generally speaking, white collar workers with a bachelor’s degree or certification. In finance, these are your analysts, tax preparers, credit analysts, computer programmers, etc.
- First/mid-level officials and managers: VPs, directors, and other managers of teams, products/services, or regions. They implement the plans dreamed up by…
- Executive/senior officials and managers: The C-suite and other top dogs who are a couple reporting levels away from the CEO.
Among financial services employees who fall into that “other” bucket, 18.9% identify as Black. That share is nearly halved to 9.2% at the professional level and shrinks further to 6.9% at first/mid-level and just 2.6% at the executive/senior level.
That share has been getting smaller. Between 2007 and 2018, representation at the highest levels of finance improved for all minority populations except Black Americans. In 2017, they held a smaller share of top jobs compared to a decade prior, according to a Financial Times analysis.
2. Let’s break it down by gender
While there were more than 2x the number of Black women working in financial services at the professional level than Black men in 2018, their representation at the top was lower: 1.4% of executive/senior officials are Black men compared to 1.3% of Black women.