Study: For Retailers, a Diverse Workforce Can Boost Sales – Even if the Neighborhood is Not Diverse

As the holiday shopping season kicks into high gear, a research study co-authored by Rutgers School of Management and Labor Relations Professor Patrick F. McKay finds that having a racially-diverse workforce can improve retail sales performance.
Patrick McKay

The study, first reported by NJBIZ, examined quarterly sales and workforce data from a retail chain that employs more than 5,000 people in 220 stores throughout 19 states. In racially-diverse communities, stores with a diverse staff delivered superior sales performance while stores without a diverse staff registered low sales performance.

“A diverse workforce is good for business,” McKay said. “This study suggests that shoppers respond favorably to a store that mirrors the look of their community.”

But the findings go even deeper. Even in less-diverse neighborhoods, stores with a larger mix of workers from different racial groups (African American, Asian American, Hispanic, Native American, White) registered higher sales. 

“Even if the neighborhood was mostly African American or mostly White, the stores with a diverse staff still had stronger sales,” McKay said. “I believe this shows that a diverse staff brings different ideas about how to serve customers more effectively, which enhances overall sales performance.” 

The study, due to be published in an upcoming issue of the Journal of Management, was led by Orlando C. Richard of the University of Texas at Dallas and co-authored by McKay, Marcus M. Stewart of Bentley University, and Timothy W. Sackett of HRU Technical Resources.

Press Contact
Steve Flamisch, Rutgers School of Management and Labor Relations
848.252.9011 (cell), steve.flamisch@smlr.rutgers.edu