Company Offers Recruiters an ‘Inroad’ to Sourcing Minority Candidates

By Fay Hansen

Jun. 23, 2009

The annual publication of the Fortune 500 list is always a sharp reminder of how little progress has been made in achieving diversity at the top of the house.

On this year’s list, only five CEOs are black. The number has never exceeded eight. If the CEOs of the Fortune 500 reflected the composition of the workforce, 55 would be black, 70 would be Hispanic, 24 would be Asian and 233 would be women.

Despite decades of well-publicized diversity and leadership development programs, occupational segregation still marks the executive office and the managerial positions that feed executive talent pools. The fact does not escape young black interns at the nation’s largest companies.

“It’s frustrating, and our interns talk about it all the time,” says Charles Cornelius, CEO of Inroads Inc., a St. Louis-based organization that places minority students in internships at major corporations.

The obstacles do not arise from a shortage of suitable black candidates for executive roles.

“There are quite a few people in the wings ready to move into top positions,” Cornelius notes. “There is a lot of talk about a lack of bench strength, but there is a cadre ready to advance. Inroads alumni are part of that cadre and well prepared for that next level.”

The recession, however, is cutting into Inroads’ internship placements in financial services firms and other troubled industries. Nationwide, black college students are struggling to launch their careers. The unemployment rate for black college graduates now stands at 7.3 percent, compared with 4.2 percent for white college graduates.

Numerous studies demonstrate that hiring practices reflect substantial levels of racial discrimination.

Cost-effective sourcing
Organizations such as Inroads offer recruiters a cost-effective approach to sourcing minority candidates for management-track positions. Inroads identifies top minority students, prepares them for internships with client companies and continues to train and mentor them until they are placed in permanent positions.

Inroads launched its first group of interns in 1970, with 25 students placed at 17 corporate-sponsor companies. Today, more than 4,500 Inroads interns work at 400 client companies.

United Technologies, PricewaterhouseCoopers, Deloitte and Target each employ more than 200 Inroads interns; Ernst & Young, MetLife, Liberty Mutual, Lockheed Martin, KPMG and Pfizer each employ more than 100.

Inroads has 12 regions, and it recruits in each region for nationwide placements.

“We recruit at hundreds of schools, but 30 to 40 are key for us,” Cornelius says.

The key schools include large state universities and historically black colleges. Inroads certifies students and checks their transcripts.

Inroads recruits minority high school and college students interested in pursuing careers in business, engineering, computer and information sciences, sales, marketing, health care management and retail management. The organization receives 25,000 to 30,000 applications a year, including many from students who rank in the top 10 percent of their class.

Inroads’ pre-college component provides supplemental academic instruction and ACT/SAT preparation and introduces students to leadership development and business skills.

The training and development Inroads offers for college students is more rigorous. It incorporates interactive business simulations, seminars, conferences, presentations, multiple interviews and other opportunities to develop management skills. Inroads then places qualified students into a pool for sponsor companies to choose from.

“We match eligible students to the companies to meet with the clients and try to provide two or three candidates for every internship position,” Cornelius notes.

For its corporate sponsors, Inroads provides early identification of talent at a reduced cost, increased diversity and improved hiring fit. The organization looks for corporate sponsors who can take at least five interns.

Participating companies commit to providing a multiyear professional opportunity for the intern and considering the intern for full-time employment upon graduation. The companies create, implement and monitor a career development plan for each intern, designate a business advisor to evaluate the intern’s progress, and offer guidance throughout the process.

Each corporate sponsor pays an annual sponsorship fee to Inroads of approximately $4,000 and a competitive salary to the intern. The students intern for two to four years, with ongoing support and guidance from Inroads staff members.

Added support
The conversion rate for interns offered jobs at the companies they interned for is 50 percent; 85 to 90 percent of the interns accept these jobs.

“The true benefit for employers is this conversion rate,” Cornelius says. “And when our client companies look at their retention rates, their highest retention rate is for their converted Inroads interns. The retention numbers make us cost-effective for employers.”

In addition to the 50 percent of interns who receive offers from the companies where they interned, 20 percent are offered jobs at other client companies.

“Our clients let us know that if a competitor firm doesn’t hire its Inroad interns, they want them,” Cornelius says.

Inroads also offers a “hot prospects” service for its clients. Hot prospects are students who graduated from the internship program but were not hired and students who went on to graduate school but have graduated and are now looking for work.

“Our true strength is that we develop, coach and mentor our interns,” Cornelius says. “What we hear from our top companies is that they want this development piece.”

An Inroads coach is assigned to each intern.

“Many of our client companies recruit where we recruit, but our relationship with the students is year-round,” Cornelius notes. “Our student managers are in touch with each intern at least once a month during the school year to discuss grades and other issues. If a student wants to change his or her major, we talk to them about that.”

During the summer months when they are working at client companies, the interns attend Inroads training and development sessions on Saturdays. The sessions cover team dynamics, time management, brand building and leadership.

Racial imbalance
“Diversity is still on the front burner for companies,” Cornelius says. But he acknowledges the huge racial imbalance that still exists in management hiring and development.

The latest unemployment reports indicate that racial disparities are even more acute on an aggregate basis.

Across the country, black unemployment for teenagers and young adults is double the rates for white youths. With official unemployment rates now at 21.9 percent for blacks ages 20 to 24 and 39.4 percent for those 16 to 19, a whole generation may be lost to chronic unemployment or underemployment.

Extensive empirical studies that use matched pairs of test candidates demonstrate that the recruiting process is still riddled with discriminatory practices. A February study by Bendick and Egan Economic Consultants Inc. of recruiting practices at high-end New York City restaurants found that recruiters were far more likely to interview and make job offers to white job candidates than equally qualified minority candidates, and far less likely to investigate the work histories of white candidates.

Another recent matched-pair study by Princeton University’s Devah Pager found that recruiters are more likely to call back a white candidate with a felony conviction than an equally qualified black candidate with a clean record. A study by the University of Chicago’s Marianne Bertrand and Harvard University’s Sendhil Mullainathan found that job candidates with white-sounding names receive 50 percent more callbacks for interviews than equally qualified candidates with black-sounding names.

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