Demographic Diversity of Managers and Employee Job Satisfaction: Empirical Analysis of the Federal Case

As the proportion of racial/ethnic minorities and women in the workforce has increased, there has been the growing concern of integrating them into the mainstream of the organization. This study explores how demographic diversity (racial and gender diversity) of management influences job satisfaction of employees in public organizations. It contributes to our understanding of the role of demographically diverse managerial teams in managing the workforce by analyzing the recent data from 191 federal agencies collected in 2008 and by using a methodologically rigorous method (multilevel modeling). The results show that the higher proportion of racial/ethnic minorities and women in managerial positions is negatively related to employee job satisfaction. Racial/ethnic minorities are more satisfied with their job and organization when there are higher levels of racial/ethnic diversity in managerial positions. No significantly different impacts of gender diversity on job satisfaction of men and women were found. Diversity climate positively moderates the relationships between racial/ethnic and gender diversity of managers and job satisfaction of employees, whereas procedural justice and leadership negatively moderated the relationships.