Behind the Curtain of Workforce Diversity: Evidence from EEO-1 Reports

Abstract

We leverage the 2023 court-ordered FOIA release of standardized Equal Employment Opportunity (EEO-1) reports to examine the workforce diversity of federal contractors. Using the released data for a sample of over 19,000 publicly traded and private firms, we provide descriptive evidence on the variation in gender and racial diversity of these companies' workforce.  We also document the existence of a racial gap between managers and lower-level employees.  A substantial portion of that gap cannot be explained by industry or geographic factors, reflecting the influence of firm-level characteristics. Then, focusing on a sample of over 800 publicly traded federal contractors, we find robust evidence that the racial managerial gap is associated with firms' decision to withhold the voluntary disclosure of their EEO-1 forms. While our findings are subject to several caveats, we provide important evidence on workforce diversity and highlight the importance of using granular, firm-level data to study diversity topics.

Keywords: EEO Form; Diversity Metrics; Strategic Disclosure

JEL Classification: J15, M14, M51