Diversity graphic via Pixabay.com.

Making The Economic Case For Increased Diversity And Inclusion In The Travel Industry

Twelve years ago, I worked with my first travel and tourism digital marketing client. They were a publisher of two travel guides – one featuring activity holidays and the other weddings and honeymoons. The project involved heading up a complete rebrand and implementing a digital marketing strategy, including building out a new website so that they could increase the number of leads generated for their clients.

Since successfully completing that project, I have worked with many travel brands and attended many travel conferences and events. Sadly, diversity has been lacking at these events as I am often the only or one of a few people of color (Hispanic, Black, Asian, etc.) in the room. Am I surprised by this? No, because my experience in the tourism industry is the same as in other sectors (publishing, management consulting, law) I’ve worked in, both in the United States and the United Kingdom.

The lack of diversity in corporate environments, including travel indusry, is most unfortunate because, as pointed out in the Diversity Wins report published by McKinsey & Company, “the business case for diversity, equity, and inclusion (DE&I) is stronger than ever.” Diverse companies are more likely of outperforming their industry peers as profitability increases over time.

What is Diversity, Equity & Inclusion?

Diversity and inclusion go hand in hand with ending systemic racism but are different from one another.  Diversity involves organizations employing or doing business with people of different backgrounds. This includes being receptive to hiring and working with people of different ages, gender, ethnicity, religion, disability, sexual orientation, education, socioeconomic status, nationality, etc. Having a diverse staff with client and business partners is essential, as this results in differing personal/professional experiences and perspectives that will enhance an organization’s decision-making process and growth plans.

On the other hand, inclusion refers to the values, culture, and specific practices of an organization to not only accept but genuinely welcome and embrace people of different backgrounds. Thus, it is not just about hiring and partnering with diverse groups of people but ensuring a hostile-free working environment in which everyone feels that they belong and their viewpoints and contributions are welcome by colleagues and management.

When organizations embrace inclusion, empowered employees are encouraged to work without having to significantly code-switch (conform), damper their personalities, and hide their cultural identity. Their contributions and differing perspectives are valued, and they are thus able to perform to their full potential, no matter their background, identity, or circumstances.

Increased diversity and inclusion policies and programs, lead to greater equity as businesses are helping all their employees not just succeed in their day-to-day job and thrive but grow on a personal and professional level. The key here is increasing access, resources, and opportunities for all but especially for those in minority groups. This requires a diverse and inclusive staff in entry-level positions and at all levels and departments, including the c-suite.

Diversity and Inclusion results in greater equity and feeling of belong. Diversity and Inclusion result in greater equity and a feeling of belonging. Photo Credit: © Sierra Constellation Partners

Executive team diversity is critical because, as also pointed out in the Diversity Wins report, which analyzed data from 1,000 companies in a range of industries, including travel from across fifteen countries, “the relationship between diversity on executive teams and the likelihood of financial outperformance is now even stronger than before.”

Essentially, senior leadership is needed to drive diversity and inclusion initiatives throughout an organization, and it’s more impactful and profitable when gender, ethnic and cultural diversity is in the mix.

A few more findings from the Diversity Wins report include:

Specific to gender diversity:

  • Across major industries, female executive representation remains below 25% and has increased slowly since 2014
  • Executive teams with more than 30% women are more likely to outperform those with fewer or no women
  • 25% of companies in the top quartile for gender diversity are more likely to have financial returns above their respective national industry medians

Specific to ethnic and cultural diversity:

  • Companies can be categories into five categories when it comes to diversity and inclusion: diversity leaders, fast movers, resting on laurels, moderate movers, and laggards
  • 36% of companies in the top quartile for racial and ethnic diversity are more likely to have financial returns above their respective national industry medians
  • The penalty for lagging on diversity is growing, while top-quartile companies are more likely to outperform all their peers

Overall, gender and ethnic diversity in leadership teams have progressed slowly since their initial study in 2014. Furthermore, companies in the top quartile for gender and ethnic diversity are 12% more likely to outperform all other companies in the data set.

The business case for ethnic diversity on executive teams remains strong. Diversity Wins: The business case for ethnic diversity on executive teams remains strong. Photo Credit: © McKinsey & Company.

Diversity and Inclusion in the Travel Industry

Beyond the economic benefits, we know that demographic changes warrant an increase in diversity and inclusion in all sectors, including the travel industry. With that in mind, let us look at the changing demographics in the United States, one of the biggest markets for inbound and outbound tourism.

From the latest census report and analysis from Pew Research Center, we know that the population in the United States is projected to be “438 million in 2050, from 296 million in 2005, and fully 82% of the growth during this period will be due to immigrants arriving from 2005 to 2050 and their descendants.”

Specific to racial and ethnic groups:

  • Hispanic population: 42 million in 2005 and projected to increase to 128 million in 2050, tripling in size. With this increase, Hispanics will be 29% of the population, compared with 14% in 2005. They will also account for 60% of the country’s population growth from 2005 to 2050.
  • Black population: 38 million in 2005 and projected to increase to 59 million in 2050, a rise of 56%. With this increase, the Black population will be 13.4% in 2050, compared with 12.8% in 2005.
  • Asian population: 14 million in 2005 and projected to increase to 41 million in 2050, nearly tripling in size. With this increase, 9% of the US population will be Asian, compared with 5% in 2005. Most Asians in the United States were foreign-born in 2005 (58%), but by 2050, fewer than half (47%) will be.
  • White non-Hispanic population: 199 million in 2005 projected to increase to 207 million in 2050, a mere 4% increase. With this increase, 47% of the US population will be non-Hispanic white in 2050, compared with 67% in 2005.

So 2050 (just 28 years away) the Hispanic, Black, and Asian population will combine to make up 51.4% of the United States population. Thus, not only does it makes economic sense, but with changing demographics, it is the right thing to do. Yet, despite these projections, we see little change in the travel industry, and an overwhelming majority of managers, directors, and senior-level executives continue to be White people. We know this via a new report: 2022 Equity, Diversity & Inclusion Study published by Destinations International, a professional organization representing destination organizations and convention and visitor bureaus worldwide.

Below is a summary of the 491 respondents based on their position level:

  • Executive/VP/C-Suite: 80.71% White, 5.08% Hispanic, 8.12% Black, 1.02% Asian
  • Director: 71.21% White, 9.85% Hispanic, 12.88% Black, 1.52% Asian
  • Manager: 67.52% White, 13.68% Hispanic, 10.26% Black, 1.71% Asian
  • Entry-level: 39.47% White, 36.84% Hispanic, 15.79% Black, 5.26% Asian

Assuming this is a representative sample, these figures from last year’s survey look promising at the Entry Level. Still, as indicated above, for diversity and inclusion programs to work, we need the managers, particularly those in the c-suite, to be more diverse. Especially when you factor in that via MMGY Global study with the Black Travel Alliance, we know that Black travelers in the United States spent $129.6 billion on domestic and international travel in 2019 which represents 13.1% of the United States leisure travel market. Similarly, Hispanic travelers in the United States spent $113.9 billion on domestic leisure travel in 2019 and accounted for 13% of all domestic leisure travel that year.

What can the Travel Industry do to increase diversity and inclusion?

To start, organizations and all professionals in the travel industry need to acknowledge that there are diversity and inclusion challenges. Surprisingly via a recent Travel Weekly study, some still don’t think that there is a problem.  In fact of the 423 industry professionals responding to the Travel Weekly survey, 61% of white respondents strongly agreed and agreed that the travel industry is diverse and inclusive.  Of Black respondents, only 15% agreed that the travel industry is diverse and inclusive.  Heck, zero percent of Black respondents strongly agreed with this statement.  So there is a disconnect and clearly much work to be done – to not only create awareness of the challenges but also work towards making meaningful changes.  All has not been solved with the increased awareness of the Black Lives Matter Movement in the last two years.

Beyond acknowledging the diversity and inclusion challenges, companies in the travel industry should reframe them as an opportunity to take bold steps including by launching initiatives and programs to:

  • Increase gender, ethnic and cultural diversity in senior leadership and critical roles
  • Provide diversity and inclusion training for senior leadership, managers, and staff
  • Set specific, measurable, achievable, relevant, and time-bound (SMART) goals for diversity and inclusion across all departments
  • Hold senior leadership and managers via personal appraisals accountable for delivering on SMART diversity and inclusion goals
  • Hire, train and retain diverse talent in all departments including, human resources, advertising, marketing, public relations, procurement, finance, trade, and commercial development, community relations, investor relations, etc.
  • Establish a fair process for tackling discriminatory behaviors such as bullying, harassment, and microaggressions
  • Foster a culture of belonging among all employees, especially amongst minority employees

Also, destination management organizations and travel brands should:

  • Work with local tourism businesses, embracing and showcasing cultural experiences for the majority as well as minority groups
  • Increase minority representation at travel industry events including conferences and tradeshows – both attendees and speakers
  • Hire destination marketers and public relations agencies, that embrace and respect the values of diversity
  • Ensure that website, social media channels, as well as paid advertising (radio, print, and digital), include diverse imagery
  • Market to diverse audiences year-round; so for Black people not just during Black History Month
  • Include minority journalists, content creators, and influencers on press trips so that the travel stories of a city/country are not just through the White gaze

All of the recommendations will go a long way toward enhancing diversity and inclusion in the travel industry.  They will also take time to plan and implement.  But there is no time like the present to get started as:

  • There is increasing demand for global travel after the COVID pandemic
  • It is the moral and humane thing to do with changing demographics
  • Diverse and inclusive companies are more inviting to potential employees that experience greater job satisfaction
  • Happier employees lead to increased productivity and a better working environment
  • Greater innovation and creativity from a diverse workforce with an increased range of skills and knowledge
  • Increased understanding of prospects and customers which leads to better product development, customer service, inclusive marketing campaign, etc.
  • Higher revenues for destinations and travel brands that target niche audiences

The road ahead is difficult and I hope that we will see vast improvements in the travel industry in another five to ten years. We increasingly travel for various reasons, and this often involves interacting with people of different ethnic backgrounds and cultures. That is why it’s so important for destination marketing organizations, visitors bureaus, destination management companies, travel brands (airlines, hotels, cruise, tour operators, travel agents), and all the other providers in the hospitality industry to cultivate a diverse workforce along with suppliers, and clients. We should all see ourselves represented. Furthermore, all people, irrespective of gender, ethnicity, sexuality, socio-economic background, etc., must be made to feel genuinely welcome and safe. Finally, all in the travel distribution system, including local communities, must profit from the opportunities in the travel industry.

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