Starbucks Manufacturing Diversity Slips Despite 2025 Push
(Bloomberg) -- Starbucks Corp. will focus on improving the promotion and hiring of people of color for top roles at its manufacturing operations this year after diversity slipped there, pushing to build on incremental improvements in racial and gender diversity overall last year as it tries to meet aggressive 2025 goals.
The coffee retailer promised in 2020 that by 2025, at least 30% of those in all corporate jobs and at least 40% of those in all retail and manufacturing roles would be Black, indigenous or other people of color. It had met about a third of those goals through October of last year. People of color rose to 48% of the workforce in 2021 from 47% in October 2020, Starbucks said in a statement Tuesday.
In manufacturing, people of color slipped to 12.5% of director-level employees from 14.3%, and dropped to 23.9% from 27.4% among managers, from the end of September 2020 to the beginning of October 2021. Both categories are short of the 40% goal for 2025.
“As we go up each level, our numbers get smaller,” said Dennis Brockman, who was promoted to senior vice president and chief global inclusion and diversity officer in March last year. “That’s really the work for us.”
The company was among hundreds that promised to redouble efforts to give more opportunity to Black workers after the murder by police of George Floyd in 2020 prompted widespread protest over inequality in U.S. society. The largest companies have pledged more than $11 billion in new spending, and many, like Starbucks, set specific hiring targets.
“We’ve been very intentional in holding ourselves accountable and being transparent with the work that we have to do to,” Brockman said. That’s why the focus this year will shift to manufacturing locations such as roasting plants, where people of color lost ground in management, he said.
Last year, half of the people being promoted or hired into a senior vice president role -- a group that includes Brockman -- were people of color, he said. Still, among the leadership roles in corporate, retail and manufacturing, the 2025 goals have only been met in two of 11 job categories, company data show. Entry-level workers such as baristas already meet the targets.
Women rose to 71% from 69% of the total workforce in 2021, and lag significantly behind men only in the company’s manufacturing segment, the data show.
Starbucks will nearly double its spending with underrepresented suppliers such as minorities, women and veterans by 2030, to $1.5 billion from about $800 million last year, and will launch a program with Arizona State University designed to help such suppliers improve their business operations, Brockman said. The company will also spend 15% of its advertising budget with media companies that are minority-owned or targeting minority audiences.
While generally seen as progressive in policies related to diversity, such as promotion and pay equity, Starbucks isn’t without worker friction. Employees in New York voted last month to establish the sole unionized restaurant among the coffee chain’s thousands of corporate-run U.S. sites. Since then, employees in cities including Boston, Chicago, Knoxville, Tennessee, and Starbucks’s hometown of Seattle all have petitioned to unionize with the Service Employees International Union affiliate Workers United.
Starbucks shares fell 1.9% to $104.04 in New York trading Tuesday. The stock rose 9.3% last year, trailing the 27% rise of the S&P 500 index.
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