Can workforce diversity stimulate transformation towards a more sustainable future?

Decarbonising and achieving net-zero places many industries under enormous challenges. The foundation industries face particularly stark challenges in achieving de-carbonisation alongside workforce sustainability and diversity.  

The foundation industries, consisting of the glass, cement, paper, metal, ceramic and chemical sectors, play a critical role in the UK manufacturing supply chain with a combined turnover of £67.7bn and employment of approximately 250,000 workers.  

The environmental impact of the industries far outweighs its size: 50 million tonnes of CO2 are emitted per year, equivalent to 10% of all CO2 emissions from UK business and private homes, despite accounting for only 0.26% of national revenue. In order to meet the Government’s own net-zero strategies, the foundation industries require dramatic transformation in consumption, production and innovation.  

Yet difficulties in achieving a transformation are linked to lost opportunities in workforce management. For several decades, the industries have placed limited attention on the skills required to maintain competitiveness, replacing long-term skills development with a short-term focus on filling vacancies within an already aging, male dominated workforce.  

A persistent lack of diversity only emphasises the challenges faced in supply chain demands, productivity losses, and technological advancements: in 2020, women made up only 16% of all workers, and BAME workers only 7.1%. Thus, the difficulties in achieving any transformation are compounded by a looming skills shortage, loss of expertise and an inability to meet future demand.  

Traditionally, firms have relied upon foreign labour markets to reconcile shortages in labour supply and skills. However, restricted access due to COVID-19 and the lasting consequences of Brexit have emphasised an existing difficulty in recruiting and retaining gender and ethnic minorities.  

We are working on a new Centre for Employment Relations, Innovation and Change (CERIC) project that studies the underlying causes of attrition for women and ethnic minorities and a lack of diversity in the foundation industries. In particular, we focus on gender and ethnic pay gaps, and organisational data on promotions, pay and exit to understand how these factors contribute to women’s and minorities’ under-representation in the foundation industries and in leadership.  

We look to better understand how pursuing workforce diversity and inclusion can support decarbonisation not only in addressing skills shortages, but in accessing innovation through new management and organizational structures.  

Collaborating with our industrial partner – Ferrovial Construction -  we plan to conduct an intensive case study which combines existing administrative data on pay, progression and retention with exit interviews and new empirical insight to understand the factors that contribute to exit and/or lack of progression in the foundation industries.  

We will focus on understanding if and why women and ethnic minorities leave the firm, and look to understand how promotion opportunities and pay impact decisions. Additionally, we will look at discrepancies in promotion opportunities in male-dominated roles.   

The project will provide a case study to be utilized across the foundation industries that identify factors of attrition to develop appropriate strategies to attract and retain gender and minority ethnic workers.  

This project is supported by the UKRI and Transforming the Foundation Industries Network small grant scheme.