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Layoffs are a reality for many industries, and unfortunately, they can have a significant impact on new mothers and hard earned gains in workplace diversity. 

When companies undergo layoffs, they may not consider the long term financial consequences and the impact on workplace DEI initiatives.

Here are some of the ways that layoffs can impact new mothers and their employers, and what companies can do to retain them during these difficult times.

Reduced Diversity, Inclusion, and Equity

When new parents are laid off, it impacts workplace diversity and inclusion efforts. Women and people of color are already underrepresented in many industries and positions, and layoffs disproportionately affect these groups.

According to Built In reporting on tech layoffs, “between February 2020 and April 2020, women lost nearly 11.9 million jobs, including over 11.1 million in April alone - which means one month of the pandemic’s losses wiped out nearly an entire decade of women’s job gains since the Great Recession. Black women and Latinas experienced double digit unemployment rates for six consecutive months in 2020 (April through September), peaking at 20.1 percent for Latinas in April 2020 and 16.6 percent for Black women in May 2020. All this while white men’s unemployment rate peaked at 12.3 percent in April 2020 and only remained in the double digits for two months.”

Companies that prioritize diversity and inclusion tend to have better financial performance. A 2018 report from McKinsey & Company found that companies in the top quartile for gender diversity were 21% more likely to have above-average profitability than companies in the bottom quartile. The same report found similar results for racial and ethnic diversity.

To maintain workplace diversity, companies can implement and maintain policies and practices that support new mothers and other underrepresented groups. This can include providing lactation support at work, offering flexible work schedules, and implementing diversity and inclusion training for all employees. As well as taking into account DEI metrics during consolidations. 

How to Retain New Parents, During These Changing Times

A survey conducted in January 2023 by Justworks showed that 72% of employed parents are actively looking or are open to a new job due to fears of being laid off. Even though 55% of respondents agreed that they have fewer employment opportunities in this economic environment. 

Demonstrating security and stability for new parents is key to retaining them. When lactating parents consider returning to work or remaining in their role, they want to know that they will be supported and will have a stable income for their children. Retention of new parents also comes down to access to reasonable childcare, job flexibility, and the ability to pump at work if they are lactating. For example, if an employer provides a lactation room and lactation program, a supportive work environment is created and mothers are more likely to return to the workplace. This improves employee perception of workplace diversity overall and makes them want to stay with the organization long term according to a study of Healthy Horizons’ Fortune 500 clients.

Mutual of Omaha implemented this and it resulted in an 83% retention rate of new parents vs. the national average of 59%. Other studies show companies with lactation programs have retention rates of 94.2% and $75,000 in savings for each employee who returns to work after maternity leave.

By considering the impact of layoffs on new parents and employers' bottom line, companies can make more informed decisions about how to manage their workforce during difficult times. By investing in support for new mothers and maintaining a diverse and inclusive workplace, companies can improve their financial performance and diversity in the long run.

Need help starting or maintaining your company’s corporate lactation program? We’re here to help, reach out with any questions.We’ve also got you covered with advice on how to furnish a lactation space, and workplace lactation laws by state.