Building a diverse workplace isn’t just about compliance. It’s a commitment to fostering an environment where different cultures, backgrounds, and experiences shape a stronger, more innovative organization.
Companies that promote diversity create inclusive cultures and set themselves up for success. Read on to learn more about 11 types of diversity in the workplace and why they matter.
What is diversity in the workplace?
Workplace diversity refers to the level of representation of different cultures, identities, and perspectives within an organization. A diverse workplace has team members of different races, ethnicities, genders, sexual orientations, and religions. A diverse team also includes different abilities, socioeconomic backgrounds, and more.
Diversity, also called diversity and inclusion (D&I) or diversity, equity, inclusion, and belonging (DEIB), helps companies build an inclusive workplace and a diverse team. It cultivates an equitable environment where everyone can succeed and have equal access to opportunities.
11 types of diversity
A genuinely diverse workplace recognizes that diversity and inclusion extend beyond race and gender. Two of the broadest categories of workplace diversity are internal and external diversity:
1. Internal diversity
These are inherent traits, such as race, gender, ethnicity, sexual orientation, disability, and age. Because these characteristics are core to a person’s identity, they shape individual experiences in the workplace. Companies that prioritize gender diversity and provide accommodations for employees with disabilities create a more inclusive and equitable environment.
2. External diversity
This includes factors shaped by life experiences, like marital status, socioeconomic status, education, and religion. Unlike internal diversity, these characteristics can change over time. A company that respects religious beliefs and values employees from different socioeconomic backgrounds creates a more diverse workforce.
Internal and external diversity examples include the following:
3. Cultural diversity
A culturally diverse workplace brings together employees from different nationalities, languages, and traditions, enriching the work environment with varied perspectives. Cultural diversity examples include teams that communicate in multiple languages, companies that recognize and celebrate a range of cultural holidays, and organizations that adapt their business strategies to different regional customs. Companies that embrace cultural diversity gain fresh problem-solving approaches, improve cross-cultural communication, and connect better with global markets by understanding local consumer behaviors and expectations.
4. Language and linguistic diversity
A diverse workforce includes employees who speak different languages and dialects. Companies that support linguistic diversity benefit from expanded global reach, better cross-cultural communication, and stronger team collaboration. Offering language training and translation resources can help bridge communication gaps.
5. Racial and ethnic diversity
This is the presence of employees from different racial and ethnic backgrounds within an organization. A workplace that embraces racial diversity promotes equitable opportunities for employees of all racial and ethnic identities. Companies can support ethnic diversity through fair hiring practices, like using inclusive job descriptions, encouraging a diverse applicant pool, and hiring remotely.
6. Gender diversity
A gender-diverse workforce includes people of all gender identities, including transgender and cisgender men and women, nonbinary individuals, and those who are gender-nonconforming. Supporting gender diversity means more than just visibility and representation—it requires equitable access to leadership, fair pay, and career development opportunities. Companies that implement inclusive policies, such as gender-neutral parental leave and professional development programs, help create a workplace where everyone feels valued and empowered to succeed.
7. Sexual orientation diversity
This refers to a workplace where employees of all sexual orientations—lesbian, gay, bisexual, pansexual, asexual, and more—feel safe and respected. An organization’s policies, benefits, and culture should support all employees regardless of sexual orientation. Creating employee resource groups (ERGs)—voluntary, employee-led groups that foster a diverse and inclusive workplace—and implementing anti-discrimination policies can help promote an environment that allows individuals to be fully themselves.
8. Neurodiversity
Employees have different cognitive abilities and ways of thinking. Recognizing neurodiverse conditions like autism, attention deficit hyperactivity disorder (ADHD), and dyslexia helps all employees thrive. Organizations can support neurodiverse team members by providing flexible communication styles, sensory-friendly spaces, and structured work processes.
9. Age diversity
A multigenerational workforce includes employees from different age groups, from recent graduates to seasoned professionals. Encouraging age diversity allows organizations to benefit from fresh, new perspectives and deep industry expertise. Supporting mentorship programs and employee development at all career stages contributes to this diversity.
10. Disability diversity
This refers to a workplace that includes and supports employees with physical, cognitive, and neurodiverse disabilities. Prioritizing inclusion for disabled employees means ensuring that workplace accommodations, technology, and flexible policies allow everyone to contribute equally and effectively. Investing in an inclusive workplace means recognizing that every employee brings unique value regardless of their abilities.
11. Socioeconomic diversity
Employees come from different socioeconomic backgrounds, which can influence their education and career trajectories. A workplace that values socioeconomic diversity ensures that advancement opportunities, compensation, and benefits are equitable for team members of all socioeconomic statuses. Financial wellness programs and scholarships can help level the playing field for employees from underrepresented backgrounds.
Why is workplace diversity important?
Here are six key benefits of workplace diversity:
1. Increased creativity and problem-solving
A diverse workforce brings together employees with unique insights and approaches to challenges. When people with different cultural backgrounds, gender identities, and life experiences collaborate, they offer a wider range of ideas and can solve problems more effectively.
2. Broader market reach and customer understanding
A company that reflects the diversity of its customers can better understand and serve them. Having employees from varied racial, ethnic, and socioeconomic backgrounds allows businesses to connect authentically with different communities. Companies that embrace diversity in their teams can develop more inclusive marketing and create products that meet diverse needs.
3. Higher employee engagement and satisfaction
Employees are more engaged when they feel valued and respected, and a strong, inclusive workplace fosters trust and collaboration. Companies that actively support gender diversity, disability inclusion, and various religious beliefs create an environment where employees feel safe to express themselves.
4. Enhanced reputation and talent retention
More and more job seekers are looking for employers that prioritize inclusive hiring and equal opportunities for career growth. Companies known for their diversity and inclusion efforts tend to attract top talent, build strong reputations, and see higher employee retention. In fact, research from Equalture shows that workplace diversity can lead to a 68.3% increase in employee retention.
5. Reduced turnover rates
Employees are more likely to stay with a company that recognizes their unique contributions. High turnover is costly, but businesses that promote diversity and inclusion retain employees longer by providing clear pathways, mentorship programs, and fair compensation. Addressing unconscious biases in promotions and leadership decisions ensures equal access to growth opportunities.
6. Stronger financial performance and innovation
Studies show that workplace diversity isn’t just good ethics—it’s good business. A McKinsey report found that companies with the most gender and ethnic diversity at the executive level were 9% more likely to see higher profits than their competitors. Organizations that welcome a mix of backgrounds and viewpoints foster innovation, encourage ongoing learning, and strengthen their competitive edge.
3 best practices for fostering workplace diversity
Human resources (HR) teams are key to making diversity efforts more than just a checkbox—they go further by integrating meaningful change into company culture. Here are three practical strategies to build a more inclusive workforce:
1. Implement blind hiring practices
First impressions can be misleading, and sometimes, unconscious bias unfortunately influences hiring decisions in ways people don’t even realize. Blind hiring removes details like names, gender, and ethnicity from candidate applications, keeping the focus on what really matters, such as skills, experience, and other qualifications. This fosters a fairer hiring process and, in turn, leads to a more diverse workforce.
2. Provide diversity training and awareness programs
True diversity training is more than a one-and-done deal. It requires ongoing sessions to give employees the tools they need to recognize unconscious bias and understand how it affects decision-making. By using real-world examples—especially in leadership and hiring—companies can embed diversity and inclusion into everyday workplace interactions, creating a culture where different perspectives are valued and respected.
3. Encourage open communication and feedback
Building an inclusive workplace means giving employees a voice. Clear communication channels, like diversity councils and anonymous feedback forms, allow teams to express concerns and suggest improvements. Companies that actively listen and respond to feedback create a better sense of belonging for all team members.
Foster diversity with seamless global hiring through Oyster
Diversity in the workplace is more than just a buzzword. It’s a cornerstone of innovation, inclusion, and business success. By embracing workplace diversity, companies can attract new perspectives and build a culture where employees thrive—but it all starts with hiring.
Oyster’s global employment platform can help your team recruit, onboard, and manage a diverse workforce across borders. From ensuring compliance with local labor laws to streamlining payroll and benefits, Oyster empowers businesses to build a team that reflects the world’s diversity without the administrative burden.
Learn more about how Oyster’s employer of record services can help you build a more inclusive, global team.
About Oyster
Oyster is a global employment platform designed to enable visionary HR leaders to find, engage, pay, manage, develop, and take care of a thriving distributed workforce. Oyster lets growing companies give valued international team members the experience they deserve, without the usual headaches and expense.
Oyster enables hiring anywhere in the world—with reliable, compliant payroll, and great local benefits and perks.
