Redfin's Diversity Report: Progress, Challenges, and Action Plans for 2021

Redfin’s latest internal diversity report indicates modest improvements in racial and ethnic representation but highlights a critical challenge with higher attrition rates among employees of color, particularly Black team members. The report, which includes data through June 1, 2020, shows the company is implementing concrete measures—including tying executive bonuses to diversity goals—to foster a more inclusive workplace. This analysis breaks down the key findings and the company's strategic response.

How Diverse is Redfin's Workforce Compared to Industry Benchmarks?

According to the report, the percentage of Redfin employees who are people of color increased from 30% to 31% over a two-year period. This growth was driven by increased representation of Black and Hispanic employees. The company's field organization—which includes employees in brokerage, mortgage, and title services—shows a significantly higher representation of people of color than the real estate industry average. Conversely, representation on the software development team is reported to be similar to that of major tech companies. Despite this progress, Redfin acknowledges that people of color, especially Black and Hispanic individuals, remain underrepresented compared to their proportion of the overall U.S. population.

What are the Primary Diversity Challenges Identified?

The most significant issue identified is employee attrition. In 2020, people of color were 9% more likely to leave Redfin than the average employee, with Black employees being 36% more likely to leave. This higher attrition rate is noted as the company's most serious diversity challenge. Another area of concern is underrepresentation in management. People of color are underrepresented in Redfin’s management ranks relative to both the general population and the company's overall employee base, a trend particularly pronounced for Hispanic employees.

Regarding gender diversity, women are well-represented across the company overall, including in technology roles compared to the broader tech industry. However, men still hold most management positions, indicating a disparity in advancement opportunities.

What Actionable Steps is Redfin Taking to Improve?

Redfin has outlined a multi-faceted plan to address these disparities, focusing on accountability and systemic change.

• Executive Accountability: A significant 25% of 2021 executive bonuses will be tied to increasing the representation of people of color, especially in management. Preliminary targets were set in July 2020.
• Re-evaluating Promotion Metrics: The company is scrutinizing the use of customer surveys in agent promotions due to concerns that customer bias could negatively impact agents of color. A decision on whether to exclude these surveys from promotion decisions is pending further data analysis.
• Inclusive Management Training: Field managers received training on inclusive practices in January 2020, with training for other departments scheduled for August. The goal is to empower managers to address bias proactively.
• Pay Transparency: Redfin has rolled out pay transparency initiatives, informing a majority of headquarters employees about median pay for their role and the level above it. The company also prohibits asking for a candidate’s pay history to prevent perpetuating past pay disparities.
• Diversity-Focused Hiring: The company is expanding its "slating" practice, where for certain roles, at least one candidate from an underrepresented group must be interviewed. This approach has shown promising results, with slated roles leading to a higher percentage of hires who are people of color (41% vs. 27% for non-slated roles).

The company's initiatives are a direct response to data showing that progress has been too slow. While some teams exemplify successful diversity, Redfin's leadership acknowledges that corporate-wide programs must catch up with intentions. The increased flexibility of remote hiring and the expansion of operations in cities like Dallas are seen as key opportunities to diversify the workforce further.