Despite efforts to make our workplaces a more balanced and fairer place, discrimination remains a problem on a number of levels. New research from Oregon State University highlights how even small amounts of gender bias in the recruitment process add up to significant rates of not only discrimination but also productivity losses for firms.
“When carried through the hiring decision-making process, tiny amounts of bias will balloon into a high probability of discriminatory hiring outcomes in the eyes of the law, which also has important financial consequences for companies that end up hiring less-qualified candidates,” the researchers explain.
Fair recruitment
Bias is something that is within all of us, and while it’s often not meant with any ill intent, the mental shortcuts it enables can have big consequences when the stakes are high, such as in a recruitment situation.
The researchers examined a range of studies published over the last 30 years on gender bias and recruitment in the workplace. Positively, incidents of gender bias do appear to be reducing over time, with just 1% of hires affected today.
“The science shows that the effects of gender bias on hiring are very small,” the researchers say. “In broad strokes, it seems like hiring decisions are actually pretty fair – certainly more fair than they used to be.”
The impact of unfair recruitment
The researchers then sought to understand how biased recruitment could impact companies. They ran a number of computer simulations, which revealed that even a relatively small amount of bias in recruitment decisions not only leads to discrimination, but the recruitment of less-qualified candidates affects the bottom line of those businesses.
They highlight that a typical Fortune 500 company might hire 8,000 people per year. A 1% gender bias rate would mean that 32 sub-optimal hires take place per year. They argue that this could cost that firm around $2.8 million in lost productivity every year. If the bias rate rises to 4%, it would cost a significant $17 million in lost productivity.
Of course, gender bias is one of many possible ways that our recruitment decisions can be distorted, so in reality, the likely impact of biased recruitment will be much higher.
“Our estimates for gender bias were conservative and my simulations modeled near-optimal hiring conditions, so the impact of gender bias is likely to be higher in many real-world hiring contexts than my study indicates,” the researchers say.
Making recruitment fairer
The researchers also examined the impact of some of the most common means of reducing gender bias in recruiting, including targeted recruiting efforts to ensure a larger pool of potential female candidates. Their analysis revealed a number of challenges with these approaches.
“The targeted recruitment of highly qualified candidates can increase representation, but if you’re not fixing the underlying bias problem, these methods do not address discrimination and can lead to other issues, including employee dissatisfaction,” they explain.
Arguably the best way to reduce gender bias from the recruitment process, the researchers argue, is to remove human judgment from it as much as possible. Interviews, for instance, are very commonly used but also highly subjective.
“Hiring is always going to be an imperfect process because human beings are complicated,” the researchers conclude. “But the gold standard for any hiring manager should be to be as objective as possible in the hiring process.”
