Hiring of women holds steady as DEI gets biggest test yet

Private equity firms maintained modest progress in hiring more women last year, analysis by Private Equity Career News finds. But their commitment to diversity is facing a major test from President Donald J. Trump, who believes DEI programs lead to reverse discrimination.

Beth Rahn, founder and managing partner at Washington DC-based placement agency New Era Advisors, observed a contradiction in President Trump’s hostility to DEI given his devotion to economic growth.

“It’s disappointing that this administration is attacking social progress and social programs that actually generate better economic performance,” Rahn said, pointing to the results of academic research supporting that view. I was unable to reach the White House press office for a response.

In the fourth year the editors of Private Equity Career News have tracked hiring by gender and race, North American and UK PE firms hired two men for every woman overall—see chart below. That was consistent with every annual edition of our PE Diversitometer benchmark published since 2021, including last year‘s

However, PE firms also maintained the jump in female hiring at the junior level that the PE Diversitometer first registered last year. In 2024, 37 percent of junior-level hires were women, just below the 39 percent posted in 2023.

Meantime, PE firms continued to hire Black Americans at a rate that is far less than their participation rate in the labor force. Just 2 percent of hires last year were Black American, down from 4 percent in 2023. By contrast, Black Americans make up about 13 percent of the US labor force, according to the US Bureau of Labor Statistics.

In calculating this year’s PE Diversitometer, Private Equity Career News assigned gender to some 656 hires by North American and UK PE firms, and race to some 618 hires. The newsletter only tracks a fraction of industry hiring, but the editors believe the sample to be reasonably representative.

Federal Hostility to DEI: It’s been a fraught couple of years for diversity, equity and inclusion programs at schools, municipalities and corporations. In mid-2023, the U.S. Supreme Court struck down affirmative action programs after hearing cases brought against Harvard University and the University of North Carolina. The ruling was limited, but it set off lawsuits again corporations with scholarships, grants and other programs that reserve awards for minority groups. On taking office earlier this month, President Trump took several steps to eliminate DEI programs and affirmative action in the federal government.

The Value of Diversity: To be sure, companies such as Apple and Costco have since reaffirmed their commitment to diversity. The editors of Private Equity Career News haven’t seen evidence of LPs or GPs pulling back, and anyone opposed to diversity could pay a price in the long run. Cautioned Rahn: “I believe we will see…a bifurcation in performance over the long term from those firms that lean towards progress and evolution, that listen to the market, that listen to the data and make informed hiring and investing decisions accordingly versus those that choose not to.”

Steering Clear of Trouble: Jennifer Cormier, partner at Ropes & Gray and an expert in employment law, said that she’s seen PE firms “become more thoughtful about how they approach DEI because of the new legal landscape.” They’re taking care not to discriminate against any particular group or create numerical hiring targets. But she added that firms have many ways to achieve diversity without running afoul of laws. They can do more recruiting from, say, historically Black colleges or women-only colleges. They can train hiring managers to root out hidden biases that can lead to discrimination against minority groups. “There is a path forward if you want to continue to be committed to DEI,” Cormier said.

Broken Rungs: On that last point, organizations such as PEWIN are trying to encourage PE firms to do more to keep women climbing to the top of the profession. Rahn, a member of PEWIN, said that some women feel as though they can raise a family or have a high-powered PE career but not necessarily both. Said Rahn: “We want to see women have the support and the systems in place to continue advancing their careers in aggregate, but in particular through that mid-level stage where those broken rungs tend to exist.”