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We study minority representation in the workplace when employers engage in optimal sequential search and minorities convey noisier signals of ability than mainstream job candidates. The greater signal noise makes it harder for minorities to change employers' prior beliefs. When employers are selective, this leads to minority underrepresentation in the workplace. Diversity improves when the cost of interviewing, the average skill level of candidates, or the opportunity cost of not hiring increases. Reducing the cost of firing also increases minority representation. When employers are sufficiently unselective, the rigidity of employers' beliefs leads to overrepresentation of minorities. (JEL D83, J15, J24, J71, M12, M51)

This article reports on a study of gender and race issues in the regional office of a federal agency. After setting their own research agenda of salient issues, employees completed a long, closed-ended questionnaire; a smaller sample also responded to ten open-ended questions. The results suggest that men, women, and people of color in the agency do not share a common culture of organizational life; instead, each group organizes its experience in the agency in different ways. The authors suggest that a theoretical perspective in which gender and race are viewed as cultures provides a useful framework for understanding cultural diversity in the workplace and a necessary starting point for managing a diverse workforce.

In the changing demographics of American society, workplace diversity is today's reality. Organisations that refuse to recognise this fact risk failure in the future. Managing diversity is a business issue, not a moral, social, or legal concern. The challenge is not creating a diverse workforce, but empowering one. It is about enlightening managers to persuade a diverse workforce to raise its productivity by utilising all members to their fullest potential, thereby increasing profitability or effectiveness. Diversity refers not just to race and gender, but encompasses differences such as ages, merged companies, union/non‐union, exempt/non‐exempt, organisational newcomers and organisational oldtimers. The goal is to get the level of performance from a heterogeneous group that was formerly attained by the homogeneous group. Learning to manage diversity makes companies more competitive. In order to effectively manage diversity, organisational culture change is usually necessary.

Diversity, according to the Webster College Dictionary, is defined as: [a] quality, state, fact, of instance of being diverse; different.