Corporate America’s retreat from DEI is short-sighted—and just plain dumb

The dissonance is inescapable. Corporations like Lowes, Jack Daniels, and Harley Davidson retreat from DEI despite a drumbeat of reminders that their future customers and employees are the most diverse of our time. A human resources organization drops “equity” from its work, even as Gen Z views DEI as a workplace must-have. 

And yet, it’s hardly a secret: The global youth, in all their diverse identities, have immense contributions to make today and in the future—as leaders, employees, culture creators, and consumers—if business will only listen. If not, we risk a lack of excellence, a failure to appeal to our audience or customers, and cultural missteps in a multicultural society.

The simplest way to lose the future is to shun its inhabitants today—people who increasingly include those who look or speak differently from those in power, people whose path was different, and whose experience with traditional institutions was not always easy due to their race, class, gender, sexual orientation, gender identity/expression, faith, or other identities.

Pretending that diverse people won’t someday be employees and customers is to believe that it’s possible to stop the world’s shift by ignoring what’s already underway. When a business retreats from diversity, equity, and inclusion (DEI), it loses its connection to the future.

Here is what we invite by resisting inclusion. 

Difficulty attracting and retaining top talent

A larger applicant pool yields a greater chance of hiring strong candidates with the ability to help their employer excel in a pluralistic society. But companies must land them first. Gen Z is not only diverse, its members also look to business to champion the ideals of inclusion and belonging. Among those within the 18-29 age group, 68% said focusing on DEI is a good thing, according to a Pew Research Center survey. The average across adults from all age groups was 56%. Looking globally, consider major population centers: the median age in Africa is 18.8, and in South America and India, it is just over 32. Today, Gen Z is estimated to make up about 27% of the global workforce, jumping to 31% percent in 10 years.

A heavier burden on business

Business expressed their deep support for race-conscious admissions ahead of the U.S. Supreme Court’s ruling in 2023 overturning affirmative action in higher education. That’s because historically, employers relied on colleges and universities to prepare future workers to compete in a global society. Schools created a microcosm of the world within their gates, which developed students’ empathy, curiosity, and cultural awareness toward diverse classmates—a vital employee competency in the world economy. With universities facing new admissions restrictions, it will be up to business to develop and train new employees in how to communicate and innovate in a diverse world. Business will also be tasked with closing the skills and knowledge gaps that a less diverse group of employees will inevitably have.

Greater vulnerability during the next widespread societal disruption

Young people are both our future and our present. The pandemic made this painfully clear when service workers — disproportionately youth and people of color — worked at the front lines in grocery stores, caregiving roles, and other hourly-wage positions deemed “essential workers” but treated as disposable. Filling these jobs, the ones that keep society and the economy upright, will require earnestly courting young people in all their diversity and incentivizing their participation. We cannot push forward without their help. 

But what about brand boycotts, viral social media attacks, heated rhetoric from politicians? Yes, they are disruptive. Who wants to find themselves in a culture war? But attacks on inclusion are nothing new.

In 2020, corporations responded to the public’s horror over the murder of George Floyd and other acts of discriminatory violence perpetrated against Black civilians by police. Since then, a reactionary backlash has targeted businesses’ support for DEI, which was expressed through hiring, training, marketing, product development, and public advocacy. That backlash has prompted some corporations to retreat. This was expected. But note that deeper coverage of Tractor Supply Company’s public abandonment of DEI includes the swift, broad-based negative response to the company’s decision. The push and pull of working within a society that includes everyone has always existed. 

Sending the wrong message

Miriam Warren, chief diversity officer at Yelp and board chair of the Yelp Foundation, warned that retreating from inclusive practices can harm morale and affect hiring.

“In an ongoing tight labor market, what does that say to potential talent from under-resourced communities?” she wrote. “How can these workers ever regain trust for an organization with a reputation for turning its back on them when times get tough?”

When a company takes steps to embrace everyone and create a sense of belonging for all, it is rewarded with growth, innovation, and an enduring place in the public imagination. And when it doesn’t? That company can expect to fall behind the competition. Inclusion works. The data keep reminding us .

Social progress has never been linear. But our continued focus remains critical to the survival of a free society. Indeed, DEI efforts can reasonably be viewed as the continuation of the Civil Rights movement. The role of business remains central — and the risks to business are clear if leaders retreat.