Existing law establishes the University of California, under the administration of the Regents of the University of California. The California Constitution provides that the University of California constitutes a public trust administered by the Regents of the University of California, a corporation in the form of a board, with full powers of organization and government, subject to legislative control only for specified purposes.

This bill would request the Ralph J. Bunche Center for African American Studies at the University of California, Los Angeles, to conduct a biennial study on the racial, ethnic, gender, and LGBT diversity of the board of directors and employees of high technology companies in the United States, and would request that the study include, among other things, the number of people employed by high technology companies of each race, ethnicity, and gender, and who self-identify as LGBT. The bill would request the University of California to post a report of the study on its Internet Web site and to submit a report of the study to the Legislature, on or before January 1, 2021, and every two years thereafter, until January 1, 2031. This bill would also request the center to create an advisory board of stakeholders, as specified, to meet every 2 months until the initial study is completed in 2021, and every 6 months thereafter until 2031, to assist with the development of best practices to be included in the report and shared with high technology companies and advocates.

Existing law establishes the University of California, under the administration of the Regents of the University of California. The California Constitution provides that the University of California constitutes a public trust administered by the Regents of the University of California, a corporation in the form of a board, with full powers of organization and government, subject to legislative control only for specified purposes.

This bill would request the Ralph J. Bunche Center for African American Studies at the University of California, Los Angeles, to conduct a biennial study on the racial, ethnic, gender, and LGBT diversity of the board of directors and employees of high technology companies in the United States, and would request that the study include, among other things, the number of people employed by high technology companies of each race, ethnicity, and gender, and who self-identify as LGBT. The bill would request the University of California to post a report of the study on its Internet Web site and to submit a report of the study to the Legislature, on or before January 1, 2020, 2021, and every two years thereafter, until January 1, 2030. 2031. This bill would also request the center to create an advisory board of stakeholders, as specified, to meet every 2 months until the initial study is completed in 2020, 2021, and every 6 months thereafter until 2030, 2031, to assist with the development of best practices to be included in the report and shared with high technology companies and advocates.

Existing law establishes the University of California, under the administration of the Regents of the University of California. The California Constitution provides that the University of California constitutes a public trust administered by the Regents of the University of California, a corporation in the form of a board, with full powers of organization and government, subject to legislative control only for specified purposes.

This bill would request the Ralph J. Bunche Center for African American Studies at the University of California, Los Angeles, to conduct a biennial study on the racial, ethnic, gender, and LGBT diversity of the board of directors and employees of high technology companies in the United States, and would request that the study include, among other things, the number of people employed by high technology companies of each race, ethnicity, and gender, and who self-identify as LGBT. The bill would request the University of California to post a report of the study on its Internet Web site and to submit a report of the study to the Legislature, on or before January 1, 2020, and every two years thereafter, until January 1, 2030. This bill would also request the center to create an advisory board of stakeholders, as specified, to meet every 2 months until the initial study is completed in 2020, and every 6 months thereafter until 2030, to assist with the development of best practices to be included in the report and shared with high technology companies and advocates.

Existing law establishes the University of California, under the administration of the Regents of the University of California. The California Constitution provides that the University of California constitutes a public trust administered by the Regents of the University of California, a corporation in the form of a board, with full powers of organization and government, subject to legislative control only for specified purposes.

This bill would request the Ralph J. Bunche Center for African American Studies at the University of California California, Los Angeles, to conduct a biannual biennial study on the racial and ethnic racial, ethnic, gender, and LGBT diversity of the board of directors and employees of California high technology companies, companies in the United States, and would request that the study include, among other things, the number of people employed by the high technology industry companies of each race or ethnicity and of each gender. race, ethnicity, and gender, and who self-identify as LGBT. The bill would request the University of California to post a report of the study on its Internet Web site and to submit a report of the study to the Legislature, on or before January 1, 2020, and every two years thereafter, until January 1, 2030.

Existing law establishes the University of California, under the administration of the Regents of the University of California. The California Constitution provides that the University of California constitutes a public trust administered by the Regents of the University of California, a corporation in the form of a board, with full powers of organization and government, subject to legislative control only for specified purposes.

This bill would request the University of California to conduct a biannual study on the racial and ethnic diversity of the board of directors and employees of California high technology companies, and would request that the study include, among other things, the number of people employed by the high technology industry of each race or ethnicity and of each gender. The bill would request the University of California to post a report of the study on its Internet Web site and to submit a report of the study to the Legislature, on or before January 1, 2020, and every two years thereafter, until January 1, 2030.

Existing law establishes the Department of Industrial Relations in the Labor and Workforce Development Agency to foster, promote, and develop the welfare of the wage earners of California, to improve their working conditions, and to advance their opportunities for profitable employment. Existing law establishes within the department the Division of Labor Standards Enforcement, which is vested with the general duty of enforcing various labor laws, including the enforcement of laws prohibiting wage differentials.

This bill would state the intent of the Legislature to enact legislation that would, among other things, increase diversity and inclusion efforts of the technology sector in Silicon Valley through the recruitment and retention of diverse talent in technical roles and corporate boards, and address ethnic pay gap.

GOVERNOR'S VETO

GV Bill Id:AB 2819

Author:(Holden)

As Enrolled Ver:September 5, 2018

2/3 vote

Original Committee Reference: HIGHER ED.

SUMMARY: Requests the Ralph J. Bunche Center for African American Studies at the University of California, Los Angeles (UCLA) to conduct a biennial study on racial, ethnic, gender, and lesbian, gay, bisexual, or transgender (LGBT) diversity of the board of directors and employees high technology companies in the United States, and would request that the study include, among other things, the number of people employed by the high technology industry of each race, ethnicity and gender, and who self-identifies as LGBT.

The Senate amendments would request the Ralph J. Bunche Center for African American Studies to create an advisory board of stakeholders, as specified, to meet every two months until the initial study is completed in 2021, and every six months thereafter until 2031, to assist with the development of best practices to be included in the report and shared with high technology companies and advocates.

FISCAL EFFECT: The Assembly Committee on Appropriations estimates $500,000 dollars General Fund every two years until 2030 for UC to conduct the study

COMMENTS: Need for the bill. According to the author, "[AB 2819] will serve as a spring board to: address ethnic pay gaps, employment and outreach opportunities, board diversification, pipeline creation, upward mobility of diverse technical talent, and retention of that talent through company culture and development. This bill will also help us to understand where the current needs are to ensure access to underserved communities, and assist in efforts to increase diversity and inclusion efforts of the technology sector in Silicon Valley through the recruitment and retention of diverse talent in technical roles and corporate boards."

Background. Diversity in California's technology workforce has long been an issue of interest to the Legislature. The Assembly Committee on Jobs, Economic Development, and the Economy (JEDE) prepared a preliminary set of information on diversity within the high technology-based industries, with a focus on the Silicon Valley in June 2016. Some of the data collected by JEDE includes:

1. Sex and Gender Diversity in the Silicon Valley. According to the Bureau of Labor Statistics, women make up nearly half the total work force in the United States (U.S.) Within the tech field, they are about 20% of software developers and about 39% of web developers. In a 2015 study of Silicon Valley executives and tech leaders prepared by The Atlantic, 63% of respondents rated the severity of sexism in the tech industry on a scale of 1 to 10 at 7 or higher. In 2013, 26% of computing jobs in the U.S. were held by women, down from 35% in 1990, according to the study released in 2016 by the American Association of University Women.

At Google, women make up 30% of the company's overall workforce, but hold 17% of the company's tech jobs. At Facebook, women comprise 29% of the overall workforce but hold 15% of tech roles. At Twitter, women comprise 10% of tech jobs, though for non-technical jobs the gender split is 50-50.

1. Racial and Ethnic Diversity in the Silicon Valley. The Silicon Valley Index, an annual publication of Joint Venture Silicon Valley Institute for Regional Studies, reported in 2012 that the Silicon Valley has a higher percentage of foreign born residents (36.4%) than California (27.1%) and the U.S. (13.0%). Silicon Valley tech companies have a heavy reliance on the H-1B visa program, which allows US firms to import up to 65,000 foreign workers each year to fill jobs that require "specialized knowledge." In 2012, more than 40% of the H-1B workers in the U.S. came from India, China, or South Korea.

In regards to start-ups, black founders are just 1% of venture-invested firms, according to a 2011 survey by CB Insights. According to the Bureau of Labor Statistics, 4% of employed software developers in the U.S. are Black, 5% are Hispanic, and 29% are Asian,. Comparatively, 1% of Google's tech workforce is Black, 2% is Hispanic and 34% is Asian.

The investigative journal Mother Jones filed a Freedom of Information Act request and obtained data on the workforce diversity of Silicon Valley's top ten tech firms for 2012. Among those top 10 companies, 70% of the total workforce was male, 63% of the total workforce was White, 25% Asian, 4% Black, and 6% Hispanic. When looking at the executives and top managers of these 10 companies, it was found 83% were white, 83% were male, 13% were Asian, 1% was black, and 3% were Hispanic. For comparison, the California workforce was 55% male, 44% White, 13% Asian, 7% Black, and 34% Hispanic.

In response to growing public pressure, in 2014 top Silicon Valley firms began disclosing their diversity data and taking steps towards remedying their diversity problem. For example, Intel pledged that its workforce would reflect the broader U.S. labor pool by 2020, and it created a $300 million venture fund designated for minority-led start-ups; Facebook expanded its summer internship program for minority computer science majors and started a new internship for minority business majors; and Google began investing in and hiring from historically black colleges.

In May 2016 the Equal Employment Opportunities Commission (EEOC) released a report on employment patterns in the tech industry titled "Diversity in High Tech." A segment of the report looked specifically at California's Silicon Valley through data collected from 75 of the area's top firms. The report found that, among executives, 57% of employees were white, 36% were Asian American, 1.6% were Hispanic and less than 1% were African American. These firms had a notable contrast in the demographics of professional as compared to management jobs (executives and managers combined). Asian Americans make up 50% of professional jobs among these firms while comprising 36% of management positions. White employees make up 41% of professional jobs and 57% of management jobs.

The EEOC report also found that, in the high tech sector, especially of Santa Clara Country, women were behind men in leadership positions and in technology jobs, as technicians and professionals. Nationwide, Blacks and Hispanics were disproportionately fewer in leadership positions and in technology jobs in the high tech sector. These groups had "negligible employment representation" in high tech industries in the San Francisco Bay Area. Asian Americans were represented in management and executive positions at a markedly lower rate than their representation in Professional occupations in the high tech industry both nationally and in the Silicon Valley. Among the top 75 Silicon Valley Tech firms, Women comprise 30% of total employment. Asians and Whites comprise 88% of total employment.

1. Research on Diversity in the Workforce. A 2015 study by the McKinsey & Company consulting firm found that the increase in women's labor force participation in the U.S. over the past 40 years has accounted for about a quarter of current gross domestic product (GDP). The report estimated that $12 trillion could be added to global GDP by 2025 by advancing women's equality. The same study showed that companies with more diversity in leadership were 35% more likely to report financial returns above their national industry median.

A Bloomberg study found that companies where the diversity of their executive boards are in the top quartile enjoy significantly higher earnings and returns on equity than companies where the diversity of the executive boards are in the bottom quartile. Professor Kelli A. Green of the University of Florida wrote in 2015 that workforce diversity can bring an increase in morale, productivity, and competition.

A 2012 primer by the Congressional Research Service found that graduate enrollments in science and engineering grew 35% over the last decade with a growth in enrollment for groups generally under-represented in science and engineering. By demographic group there was a 65% increase among Hispanic students and a 50% increase among Black students.

GOVERNOR'S VETO MESSAGE:

This bill requests the Ralph J. Bunche Center for African American Studies at the University of California, Los Angeles, to conduct a ten-year study on the diversity of the board of directors and employees of United States high technology companies.

This year's Budget provides the Center $1.8 million dollars in funding. I understand the Center will use some of that appropriation to study diversity in the high technology industry. Before committing to a ten-year study, which will require additional UC funding in the future, let's see the initial results of the Center's research and make informed decisions from those findings.

Analysis Prepared by: Kevin Powers / HIGHER ED. / (916) 319-3960 FN: 0005314

CONCURRENCE IN SENATE AMENDMENTS

CSA1 Bill Id:AB 2819

Author:(Holden)

As Amended Ver:July 5, 2018

Majority vote

Original Committee Reference: HIGHER ED.

SUMMARY: Requests the Ralph J. Bunche Center for African American Studies at the University of California, Los Angeles (UCLA) to conduct a biennial study on racial, ethnic, gender, and lesbian, gay, bisexual, or transgender (LGBT) diversity of the board of directors and employees high technology companies in the United States, and would request that the study include, among other things, the number of people employed by the high technology industry of each race, ethnicity and gender, and who self-identifies as LGBT.

The Senate amendments would request the Ralph J. Bunche Center for African American Studies to create an advisory board of stakeholders, as specified, to meet every two months until the initial study is completed in 2021, and every six months thereafter until 2031, to assist with the development of best practices to be included in the report and shared with high technology companies and advocates.

FISCAL EFFECT: The Assembly Committee on Appropriations estimates $500,000 dollars General Fund every two years until 2030 for UC to conduct the study

COMMENTS: Need for the bill. According to the author, "[AB 2819] will serve as a spring board to: address ethnic pay gaps, employment and outreach opportunities, board diversification, pipeline creation, upward mobility of diverse technical talent, and retention of that talent through company culture and development. This bill will also help us to understand where the current needs are to ensure access to underserved communities, and assist in efforts to increase diversity and inclusion efforts of the technology sector in Silicon Valley through the recruitment and retention of diverse talent in technical roles and corporate boards."

Background. Diversity in California's technology workforce has long been an issue of interest to the Legislature. The Assembly Committee on Jobs, Economic Development, and the Economy (JEDE) prepared a preliminary set of information on diversity within the high technology-based industries, with a focus on the Silicon Valley in June 2016. Some of the data collected by JEDE includes:

1. Sex and Gender Diversity in the Silicon Valley. According to the Bureau of Labor Statistics, women make up nearly half the total work force in the United States (U.S.) Within the tech field, they are about 20% of software developers and about 39% of web developers. In a 2015 study of Silicon Valley executives and tech leaders prepared by The Atlantic, 63% of respondents rated the severity of sexism in the tech industry on a scale of 1 to 10 at 7 or higher. In 2013, 26% of computing jobs in the U.S. were held by women, down from 35% in 1990, according to the study released in 2016 by the American Association of University Women.

At Google, women make up 30% of the company's overall workforce, but hold 17% of the company's tech jobs. At Facebook, women comprise 29% of the overall workforce but hold 15% of tech roles. At Twitter, women comprise 10% of tech jobs, though for non-technical jobs the gender split is 50-50.

1. Racial and Ethnic Diversity in the Silicon Valley. The Silicon Valley Index, an annual publication of Joint Venture Silicon Valley Institute for Regional Studies, reported in 2012 that the Silicon Valley has a higher percentage of foreign born residents (36.4%) than California (27.1%) and the U.S. (13.0%). Silicon Valley tech companies have a heavy reliance on the H-1B visa program, which allows US firms to import up to 65,000 foreign workers each year to fill jobs that require "specialized knowledge." In 2012, more than 40% of the H-1B workers in the U.S. came from India, China, or South Korea.

In regards to start-ups, black founders are just 1% of venture-invested firms, according to a 2011 survey by CB Insights. According to the Bureau of Labor Statistics, 4% of employed software developers in the U.S. are Black, 5% are Hispanic, and 29% are Asian,. Comparatively, 1% of Google's tech workforce is Black, 2% is Hispanic and 34% is Asian.

The investigative journal Mother Jones filed a Freedom of Information Act request and obtained data on the workforce diversity of Silicon Valley's top ten tech firms for 2012. Among those top 10 companies, 70% of the total workforce was male, 63% of the total workforce was White, 25% Asian, 4% Black, and 6% Hispanic. When looking at the executives and top managers of these 10 companies, it was found 83% were white, 83% were male, 13% were Asian, 1% was black, and 3% were Hispanic. For comparison, the California workforce was 55% male, 44% White, 13% Asian, 7% Black, and 34% Hispanic.

In response to growing public pressure, in 2014 top Silicon Valley firms began disclosing their diversity data and taking steps towards remedying their diversity problem. For example, Intel pledged that its workforce would reflect the broader U.S. labor pool by 2020, and it created a $300 million venture fund designated for minority-led start-ups; Facebook expanded its summer internship program for minority computer science majors and started a new internship for minority business majors; and Google began investing in and hiring from historically black colleges.

In May 2016 the Equal Employment Opportunities Commission (EEOC) released a report on employment patterns in the tech industry titled "Diversity in High Tech." A segment of the report looked specifically at California's Silicon Valley through data collected from 75 of the area's top firms. The report found that, among executives, 57% of employees were white, 36% were Asian American, 1.6% were Hispanic and less than 1% were African American. These firms had a notable contrast in the demographics of professional as compared to management jobs (executives and managers combined). Asian Americans make up 50% of professional jobs among these firms while comprising 36% of management positions. White employees make up 41% of professional jobs and 57% of management jobs.

The EEOC report also found that, in the high tech sector, especially of Santa Clara Country, women were behind men in leadership positions and in technology jobs, as technicians and professionals. Nationwide, Blacks and Hispanics were disproportionately fewer in leadership positions and in technology jobs in the high tech sector. These groups had "negligible employment representation" in high tech industries in the San Francisco Bay Area. Asian Americans were represented in management and executive positions at a markedly lower rate than their representation in Professional occupations in the high tech industry both nationally and in the Silicon Valley. Among the top 75 Silicon Valley Tech firms, Women comprise 30% of total employment. Asians and Whites comprise 88% of total employment.

1. Research on Diversity in the Workforce. A 2015 study by the McKinsey & Company consulting firm found that the increase in women's labor force participation in the U.S. over the past 40 years has accounted for about a quarter of current gross domestic product (GDP). The report estimated that $12 trillion could be added to global GDP by 2025 by advancing women's equality. The same study showed that companies with more diversity in leadership were 35% more likely to report financial returns above their national industry median.

A Bloomberg study found that companies where the diversity of their executive boards are in the top quartile enjoy significantly higher earnings and returns on equity than companies where the diversity of the executive boards are in the bottom quartile. Professor Kelli A. Green of the University of Florida wrote in 2015 that workforce diversity can bring an increase in morale, productivity, and competition.

A 2012 primer by the Congressional Research Service found that graduate enrollments in science and engineering grew 35% over the last decade with a growth in enrollment for groups generally under-represented in science and engineering. By demographic group there was a 65% increase among Hispanic students and a 50% increase among Black students.

Analysis Prepared by: Kevin Powers / HIGHER ED. / (916) 319-3960 FN: 0003900

 THIRD READING  

Bill No: AB 2819

Author:

:

Vote:

SENATE EDUCATION COMMITTEE: 5-2, 6/27/18

AYES: Allen, Galgiani, Leyva, McGuire, Pan

NOES: Wilk, Vidak

SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8

ASSEMBLY FLOOR: 52-24, 5/30/18 - See last page for vote

SUBJECT:

SOURCE: Author

DIGEST:

This bill requests the Ralph J. Bunche Center for African American Studies at the University of California (UC), Los Angeles, to conduct a biennial study on the diversity of the board of directors and employees of United States high technology companies.

ANALYSIS: Existing law establishes the UC, under the administration of the Regents of the UC. The California Constitution provides that the UC constitutes a public trust administered by the Regents of the UC, a corporation in the form of a board, with full powers of organization and government, subject to legislative control only for specified purposes. (Article IX Section 9 of the California Constitution)

This bill:

1. Requests the Ralph J. Bunche Center for African American Studies at UC Los Angeles, to conduct a biennial study on the racial, ethnic, gender, and lesbian, gay, bisexual, or transgender (LGBT) diversity of the board of directors and employees of United States high technology companies.
   
2. Requests the study to include all of the following:
   
   1. The number of people employed by high tech companies of each race or ethnicity.
      
   2. The number of people employed by high tech companies of each gender.
      
   3. The number of people employed by high tech companies who self-identify as LGBT.
      
   4. The number of people employed by high tech companies who are employed as executives, senior officials, or managers, broken down by racial, ethnic, gender, and LGBT demographics.
      
   5. The number of people on all companies’ boards of directors, disaggregated by racial, ethnic, gender, and LGBT demographics.
      
   6. The number of people employed by high tech companies, categorized by job type, including management, technical, and administration, broken down by racial, ethnic, gender, and LGBT demographics.
      
   7. The number of people employed by high tech companies that currently live in, or have their residency in, California, disaggregated by racial, ethnic, gender, and LGBT demographics.
      
   8. Any program or programs implemented by a high tech company that are intended to attract, recruit, and retain diverse or underrepresented talent along with an investigation into the perceived effectiveness of those programs. This bill authorizes the effectiveness to be evaluated by any changes to the company’s employee demographics due to implementation of the program or programs. This bill authorizes the investigation to include research into possible reasons as to any discrepancies in effort as compared to the effectiveness of any program for each high tech company.
      
   9. The graduation data of undergraduate and graduate students from science, technology, engineering, and mathematics (STEM) fields in this state. This bill authorizes the data to include the type of degree, the degree field, geographical regions where the degree is received, and the race and gender of the students.
      
3. Requests the Ralph J. Bunche Center for African American Studies at UC, Los Angeles, to create an advisory board which is to do both of the following:
   
   1. Meet every two months until the initial study is completed in 2021, and then every six months thereafter until January 1, 2031.
      
   2. Develop best practices to be included in the report and shared with high tech companies and advocates.
      
4. Requires the advisory board to include, at a minimum, representatives of the following stakeholders:
   
   1. Student groups.
      
   2. High tech companies.
      
   3. Advocacy groups for diversity and STEM outreach.
      
   4. Academics from the STEM fields.
      
5. Requests the UC to post a report of the initial study on its Web site by January 1, 2021, and subsequent studies biennially thereafter until January 1, 2031.
   
6. Requests the UC to submit the reports of the studies to the Legislature by January 1, 2021, and biennially thereafter until January 1, 2031.
   
7. Defines “high technology company” as a publicly traded United States company in the top 25 companies as determined by total annual gross revenue, whose primary trade or business is either software development or computational hardware, and that has a business location in California and has more than 1,000 in California.
   
8. States legislative intent to urge every publicly held high tech corporation to use best efforts to encourage diversity on its board of directors by reaching the goal for those corporations to have a minimum number of people from underrepresented communities on its board.
   
9. States legislative intent relative to increasing diversity and inclusion in the technology sector in Silicon Valley.
   
10. States legislative findings and declarations relative to findings of the United States Equal Employment Opportunity Commission regarding a lack of diversity in the high tech sector.
    
11. Sunsets the provisions of this bill on January 1, 2032.

Background

1. Related legislative activity. The Assembly Committee on Jobs, Economic Development, and the Economy (JEDE) recently investigated the issue of diversity within workforce and business ownership structure of high technology industries in California. In undertaking this work, JEDE issued a Request for Information to provide an opportunity for the public, organizations, and businesses to identify public and private actions that have the potential to facilitate greater participation of underrepresented populations on corporate boards, within entry level, advanced, and senior management positions, as vendors, and within related financial entities. The JEDE prepared a preliminary set of information on diversity within the high technology-based industries, with a focus on the Silicon Valley, in June 2016. Some of the data collected by JEDE includes:
   
   1. Sex and Gender Diversity in the Silicon Valley. According to the Bureau of Labor Statistics, women make up nearly half the total workforce in the United States (U.S.). Within the tech field, they are about 20 percent of software developers and about 39 percent of web developers. In a 2015 study of Silicon Valley executives and tech leaders prepared by The Atlantic, 63 percent of respondents rated the severity of sexism in the tech industry on a scale of 1 to 10 at 7 or higher. In 2013, 26 percent of computing jobs in the U.S. were held by women, down from 35 percent in 1990, according to the study released in 2016 by the American Association of University Women.
      
      At Google, women make up 30 percent of the company's overall workforce, but hold 17 percent of the company's tech jobs. At Facebook, women comprise 29 percent of the overall workforce but hold 15 percent of tech roles. At Twitter, women comprise 10 percent of tech jobs, though for non-technical jobs the gender split is 50-50.
      
   2. Racial and Ethnic Diversity in the Silicon Valley. The Silicon Valley Index, an annual publication of Joint Venture Silicon Valley Institute for Regional Studies, reported in 2012 that the Silicon Valley has a higher percentage of foreign-born residents (36.4 percent) than California (27.1 percent) and the U.S. (13 percent). Silicon Valley tech companies have a heavy reliance on the H-1B visa program, which allows U.S. firms to import up to 65,000 foreign workers each year to fill jobs that require "specialized knowledge." In 2012, more than 40 percent of the H-1B workers in the U.S. came from India, China, or South Korea.
      
      In regards to start-ups, Black founders are just 1 percent of venture-invested firms, according to a 2011 survey by CB Insights. According to the Bureau of Labor Statistics, 4 percent of employed software developers in the U.S. are Black, 5 percent are Hispanic, and 29 percent are Asian. Comparatively, 1 percent of Google’s tech workforce is Black, 2 percent is Hispanic, and 34 percent is Asian.
      
      The journal Mother Jones filed a Freedom of Information Act request and obtained data on the workforce diversity of Silicon Valley’s top ten tech firms for 2012. Among those top 10 companies, 70 percent of the total workforce was male, 63 percent of the total workforce was White, 25 percent Asian, 4 percent Black, and 6 percent Hispanic. When looking at the executives and top managers of these 10 companies, it was found 83 percent were White, 83 percent were male, 13 percent were Asian, 1 percent was Black, and 3 percent were Hispanic. For comparison, the California workforce was 55 percent male, 44 percent White, 13 percent Asian, 7 percent Black, and 34 percent Hispanic.
      
      In response to growing public pressure, in 2014 top Silicon Valley firms began disclosing their diversity data and taking steps towards remedying their diversity problem. For example, Intel pledged that its workforce would reflect the broader U.S. labor pool by 2020, and it created a $300 million venture fund designated for minority-led start-ups; Facebook expanded its summer internship program for minority computer science majors and started a new internship for minority business majors; and Google began investing in and hiring from historically black colleges.
      
2. Equal Employment Opportunities Commission (EEOC) report. In May 2016, the federal EEOC released a report on employment patterns in the tech industry titled Diversity in High Tech. A segment of the report looked specifically at California’s Silicon Valley through data collected from 75 of the area’s top firms. The report found that, among executives, 57 percent of employees were White, 36 percent were Asian American, 1.6 percent were Hispanic, and less than 1 percent were African American. These firms had a notable contrast in the demographics of professional as compared to management jobs (executives and managers combined). Asian Americans make up 50 percent of professional jobs among these firms while comprising 36 percent of management positions. White employees make up 41 percent of professional jobs and 57 percent of management jobs.
   

The EEOC report also found that, in the high tech sector, especially of Santa Clara County, women were behind men in leadership positions and in technology jobs, as technicians and professionals. Nationwide, Blacks and Hispanics were disproportionately fewer in leadership positions and in technology jobs in the high tech sector. These groups had “negligible employment representation” in high tech industries in the San Francisco Bay Area. Asian Americans were represented in management and executive positions at a markedly lower rate than their representation in professional occupations in the high tech industry both nationally and in the Silicon Valley. Among the top 75 Silicon Valley Tech firms, Women comprise 30 percent of total employment. Asians and Whites comprise 88 percent of total employment. [https://www.eeoc.gov/eeoc/statistics/reports/hightech/]

FISCAL EFFECT: Appropriation: Fiscal Com.: Local:

SUPPORT: (Verified 8/2/18)

None received

OPPOSITION: (Verified 8/2/18)

None received

ASSEMBLY FLOOR: 52-24, 5/30/18

AYES: Aguiar-Curry, Arambula, Berman, Bloom, Bonta, Burke, Caballero, Calderon, Carrillo, Cervantes, Chau, Chiu, Chu, Cooley, Cooper, Daly, Eggman, Frazier, Friedman, Cristina Garcia, Eduardo Garcia, Gipson, Gloria, Gonzalez Fletcher, Gray, Holden, Irwin, Jones-Sawyer, Kalra, Kamlager-Dove, Levine, Limón, Low, McCarty, Medina, Mullin, Muratsuchi, Nazarian, O'Donnell, Quirk, Quirk-Silva, Reyes, Rodriguez, Rubio, Salas, Santiago, Mark Stone, Thurmond, Ting, Weber, Wood, Rendon

NOES: Acosta, Travis Allen, Baker, Bigelow, Brough, Chávez, Chen, Choi, Cunningham, Dahle, Flora, Fong, Gallagher, Harper, Kiley, Lackey, Maienschein, Mathis, Melendez, Obernolte, Patterson, Steinorth, Voepel, Waldron

NO VOTE RECORDED: Grayson, Mayes

Prepared by:

8/8/18 10:34:44

**** END ****

SENATE COMMITTEE ON EDUCATION

Senator Benjamin Allen, Chair

2017 - 2018 Regular

Bill No: AB 2819 Hearing Date: June 27, 2018

Subject: University of California: study: high technology companies: employees.

SUMMARY

This bill requests the Ralph J. Bunche Center for African American Studies at the University of California (UC), Los Angeles, to conduct a biennial study on the diversity of the board of directors and employees of United States high technology companies.

BACKGROUND

Existing law establishes the UC, under the administration of the Regents of the UC. The California Constitution provides that the UC constitutes a public trust administered by the Regents of the UC, a corporation in the form of a board, with full powers of organization and government, subject to legislative control only for specified purposes. (Article IX Section 9 of the California Constitution)

ANALYSIS

This bill:

1. Requests the Ralph J. Bunche Center for African American Studies at UC Los Angeles, to conduct a biennial study on the racial, ethnic, gender, and lesbian, gay, bisexual, or transgender (LGBT) diversity of the board of directors and employees of United States high technology companies.
   
2. Requests the study to include all of the following:
   
   1. The number of people employed by high tech companies of each race or ethnicity.
      
   2. The number of people employed by high tech companies of each gender.
      
   3. The number of people employed by high tech companies who self-identify as LGBT.
      
   4. The number of people employed by high tech companies who are employed as executives, senior officials, or managers, broken down by racial, ethnic, gender, and LGBT demographics.
      
   5. The number of people on all companies’ boards of directors, disaggregated by racial, ethnic, gender, and lesbian, gay, bisexual, or transgender (LGBT) demographics.
      
   6. The number of people employed by high tech companies, categorized by job type, including management, technical, and administration, broken down by racial, ethnic, gender, and LGBT demographics.
      
   7. The number of people employed by high tech companies that currently live in, or have their residency in, California, disaggregated by racial, ethnic, gender, and LGBT demographics.
      
   8. Any program or programs implemented by a high tech company that are intended to attract, recruit, and retain diverse or underrepresented talent along with an investigation into the perceived effectiveness of those programs. This bill authorizes the effectiveness to be evaluated by any changes to the company’s employee demographics due to implementation of the program or programs. This bill authorizes the investigation to include research into possible reasons as to any discrepancies in effort as compared to the effectiveness of any program for each high tech company.
      
   9. The graduation data of undergraduate and graduate students from science, technology, engineering, and mathematics fields in this state. This bill authorizes the data to include the type of degree, the degree field, geographical regions where the degree is received, and the race and gender of the students.
      
3. Requests the Ralph J. Bunche Center for African American Studies at the University of California (UC), Los Angeles, to create an advisory board which is to do both of the following:
   
   1. Meet every two months until the initial study is completed in 2020, and then every six months thereafter until 2030.
      
   2. Develop best practices to be included in the report and shared with high tech companies and advocates.
      
4. Requires the advisory board to include, at a minimum, representatives of the following stakeholders:
   
   1. Student groups.
      
   2. High tech companies.
      
   3. Advocacy groups for diversity and STEM outreach.
      
   4. Academics from the STEM fields.
      
5. Requests the UC to post a report of the initial study on its website by January 1, 2020, and subsequent studies biennially thereafter until January 1, 2030.
   
6. Request the University of California (UC) to submit the reports of the studies to the Legislature by January 1, 2020, and biennially thereafter until January 1, 2030.
   
7. Defines “high technology company” as a publicly traded United States company in the top 25 companies as determined by total annual gross revenue, whose primary trade or business is either software development or computational hardware, and that has a business location in California and has more than 1,000 in California.
   
8. States legislative intent to urge every publicly held high tech corporation to use best efforts to encourage diversity on its board of directors by reaching the goal for those corporations to have a minimum number of people from underrepresented communities on its board.
   
9. States legislative intent relative to increasing diversity and inclusion in the technology sector in Silicon Valley.
   
10. States legislative findings and declarations relative to findings of the United States Equal Employment Opportunity Commission regarding a lack of diversity in the high tech sector.

STAFF COMMENTS

1. Need for the bill. According to the author, “At the top 75 companies in Silicon Valley, only 3 percent of employees are black, according to the Equal Employment Opportunity Commission. Premier employers Facebook and Google have yet to achieve 2 percent in technical jobs. Any discussion about diverse hiring in Silicon Valley inevitably becomes a discussion about ‘the pipeline.’ However, it is unclear whether this means there are not qualified candidates to fill these positions or if there is another issue. This bill will help us determine what is needed to increase diverse hiring in the fastest growing industry to ensure all communities are considered. Although tech companies are eager to share that they are interested in diversity and inclusion, they are not eager to share their programs and practices. This bill will explore the diversity programs’ hiring practices that exist through an academic lens to create a better understanding of how to address the lack of diversity in Silicon Valley.”
   
2. Related legislative activity. The Assembly Committee on Jobs, Economic Development, and the Economy (JEDE) recently investigated the issue of diversity within workforce and business ownership structure of high technology industries in California. In undertaking this work, JEDE issued a Request for Information to provide an opportunity for the public, organizations, and businesses to identify public and private actions that have the potential to facilitate greater participation of underrepresented populations on corporate boards, within entry level, advanced, and senior management positions, as vendors, and within related financial entities. The JEDE prepared a preliminary set of information on diversity within the high technology-based industries, with a focus on the Silicon Valley, in June 2016. Some of the data collected by JEDE includes:
   
   1. Sex and Gender Diversity in the Silicon Valley. According to the Bureau of Labor Statistics, women make up nearly half the total workforce in the United States (U.S.). Within the tech field, they are about 20 percent of software developers and about 39 percent of web developers. In a 2015 study of Silicon Valley executives and tech leaders prepared by The Atlantic, 63 percent of respondents rated the severity of sexism in the tech industry on a scale of 1 to 10 at 7 or higher. In 2013, 26 percent of computing jobs in the U.S. were held by women, down from 35 percent in 1990, according to the study released in 2016 by the American Association of University Women.
      
      At Google, women makeup 30 percent of the company's overall workforce, but hold 17 percent of the company's tech jobs. At Facebook, women comprise 29 percent of the overall workforce but hold 15 percent of tech roles. At Twitter, women comprise 10 percent of tech jobs, though for non-technical jobs the gender split is 50-50.
      
   2. Racial and Ethnic Diversity in the Silicon Valley. The Silicon Valley Index, an annual publication of Joint Venture Silicon Valley Institute for Regional Studies, reported in 2012 that the Silicon Valley has a higher percentage of foreign-born residents (36.4 percent) than California (27.1 percent) and the U.S. (13 percent). Silicon Valley tech companies have a heavy reliance on the H-1B visa program, which allows U.S. firms to import up to 65,000 foreign workers each year to fill jobs that require "specialized knowledge." In 2012, more than 40 percent of the H-1B workers in the U.S. came from India, China, or South Korea.
      
      In regards to start-ups, Black founders are just 1 percent of venture-invested firms, according to a 2011 survey by CB Insights. According to the Bureau of Labor Statistics, 4 percent of employed software developers in the U.S. are Black, 5 percent are Hispanic, and 29 percent are Asian. Comparatively, 1 percent of Google’s tech workforce is Black, 2 percent is Hispanic, and 34 percent is Asian.
      
      The journal Mother Jones filed a Freedom of Information Act request and obtained data on the workforce diversity of Silicon Valley’s top ten tech firms for 2012. Among those top 10 companies, 70 percent of the total workforce was male, 63 percent of the total workforce was White, 25 percent Asian, 4 percent Black, and 6 percent Hispanic. When looking at the executives and top managers of these 10 companies, it was found 83 percent were White, 83 percent were male, 13 percent were Asian, 1 percent was Black, and 3 percent were Hispanic. For comparison, the California workforce was 55 percent male, 44 percent White, 13 percent Asian, 7 percent Black, and 34 percent Hispanic.
      
      In response to growing public pressure, in 2014 top Silicon Valley firms began disclosing their diversity data and taking steps towards remedying their diversity problem. For example, Intel pledged that its workforce would reflect the broader U.S. labor pool by 2020, and it created a $300 million venture fund designated for minority-led start-ups; Facebook expanded its summer internship program for minority computer science majors and started a new internship for minority business majors; and Google began investing in and hiring from historically black colleges.
      
3. Equal Employment Opportunities Commission (EEOC) report. In May 2016, the federal EEOC released a report on employment patterns in the tech industry titled Diversity in High Tech. A segment of the report looked specifically at California’s Silicon Valley through data collected from 75 of the area’s top firms. The report found that, among executives, 57 percent of employees were White, 36 percent were Asian American, 1.6 percent were Hispanic, and less than 1 percent were African American. These firms had a notable contrast in the demographics of professional as compared to management jobs (executives and managers combined). Asian Americans make up 50 percent of professional jobs among these firms while comprising 36 percent of management positions. White employees make up 41 percent of professional jobs and 57 percent of management jobs.
   

The EEOC report also found that, in the high tech sector, especially of Santa Clara Country, women were behind men in leadership positions and in technology jobs, as technicians and professionals. Nationwide, Blacks and Hispanics were disproportionately fewer in leadership positions and in technology jobs in the high tech sector. These groups had “negligible employment representation” in high tech industries in the San Francisco Bay Area. Asian Americans were represented in management and executive positions at a markedly lower rate than their representation in Professional occupations in the high tech industry both nationally and in the Silicon Valley. Among the top 75 Silicon Valley Tech firms, Women comprise 30 percent of total employment. Asians and Whites comprise 88 percent of total employment. https://www.eeoc.gov/eeoc/statistics/reports/hightech/

1. Technical amendments. The intent section of this bill should be clarified as follows:
   
   On page 2, lines 6-9: (b) Address ethnic and gender pay gaps, employment and outreach line 7 opportunities, board diversification, pipeline creation, upward line 8 mobility of diverse technical talent, and retention of that talent line 9 through company culture and development.
   
   This bill requests the University of California (UC) to post a report of the initial study on its website by January 1, 2020, and subsequent studies biennially thereafter until January 1, 2030. As a result of this timeline, the initial study is due exactly one year after the implementation date of this bill. The timelines should be extended by one year, to January 1, 2021, and January 1, 2031.
   
2. Fiscal impact. According to the Assembly Appropriations Committee, this bill would impose $500,000 General Fund every two years until 2030 for the University of California to conduct the study.

SUPPORT

None received

OPPOSITION

None received

-- END --

AASSEMBLY THIRD READING

ATR Bill Id:AB 2819

Author:(Holden)

As Amended Ver:May 25, 2018

Majority vote

SUMMARY: Requests the Ralph J. Bunche Center for African American Studies at the University of California, Los Angeles (UCLA) to conduct a biennial study on racial, ethnic, gender, and lesbian, gay, bisexual, or transgender (LGBT) diversity of the board of directors and employees high technology companies in the United States, and would request that the study include, among other things, the number of people employed by the high technology industry of each race, ethnicity and gender, and who self-identifies as LGBT.

FISCAL EFFECT: The Assembly Committee on Appropriations estimates $500,000 dollars General Fund every two years until 2030 for UC to conduct the study

COMMENTS: Need for the bill. According to the author, "[AB 2819] will serve as a spring board to: address ethnic pay gaps, employment and outreach opportunities, board diversification, pipeline creation, upward mobility of diverse technical talent, and retention of that talent through company culture and development. This bill will also help us to understand where the current needs are to ensure access to underserved communities, and assist in efforts to increase diversity and inclusion efforts of the technology sector in Silicon Valley through the recruitment and retention of diverse talent in technical roles and corporate boards."

Background. Diversity in California’s technology workforce has long been an issue of interest to the Legislature. The Assembly Committee on Jobs, Economic Development, and the Economy (JEDE) prepared a preliminary set of information on diversity within the high technology-based industries, with a focus on the Silicon Valley in June 2016. Some of the data collected by JEDE includes:

1. Sex and Gender Diversity in the Silicon Valley. According to the Bureau of Labor Statistics, women make up nearly half the total work force in the United States (U.S.) Within the tech field, they are about 20% of software developers and about 39% of web developers. In a 2015 study of Silicon Valley executives and tech leaders prepared by The Atlantic, 63% of respondents rated the severity of sexism in the tech industry on a scale of 1 to 10 at 7 or higher. In 2013, 26% of computing jobs in the U.S. were held by women, down from 35% in 1990, according to the study released in 2016 by the American Association of University Women.

At Google, women make up 30% of the company's overall workforce, but hold 17% of the company's tech jobs. At Facebook, women comprise 29% of the overall workforce but hold 15% of tech roles. At Twitter, women comprise 10% of tech jobs, though for non-technical jobs the gender split is 50-50.

1. Racial and Ethnic Diversity in the Silicon Valley. The Silicon Valley Index, an annual publication of Joint Venture Silicon Valley Institute for Regional Studies, reported in 2012 that the Silicon Valley has a higher percentage of foreign born residents (36.4%) than California (27.1%) and the U.S. (13.0%). Silicon Valley tech companies have a heavy reliance on the H-1B visa program, which allows US firms to import up to 65,000 foreign workers each year to fill jobs that require "specialized knowledge." In 2012, more than 40% of the H-1B workers in the U.S. came from India, China, or South Korea.

In regards to start-ups, black founders are just 1% of venture-invested firms, according to a 2011 survey by CB Insights. According to the Bureau of Labor Statistics, 4% of employed software developers in the U.S. are Black, 5% are Hispanic, and 29% are Asian,. Comparatively, 1% of Google’s tech workforce is Black, 2% is Hispanic and 34% is Asian.

The investigative journal Mother Jones filed a Freedom of Information Act request and obtained data on the workforce diversity of Silicon Valley’s top ten tech firms for 2012. Among those top 10 companies, 70% of the total workforce was male, 63% of the total workforce was White, 25% Asian, 4% Black, and 6% Hispanic. When looking at the executives and top managers of these 10 companies, it was found 83% were white, 83% were male, 13% were Asian, 1% was black, and 3% were Hispanic. For comparison, the California workforce was 55% male, 44% White, 13% Asian, 7% Black, and 34% Hispanic.

In response to growing public pressure, in 2014 top Silicon Valley firms began disclosing their diversity data and taking steps towards remedying their diversity problem. For example, Intel pledged that its workforce would reflect the broader U.S. labor pool by 2020, and it created a $300 million venture fund designated for minority-led start-ups; Facebook expanded its summer internship program for minority computer science majors and started a new internship for minority business majors; and Google began investing in and hiring from historically black colleges.

In May 2016 the Equal Employment Opportunities Commission (EEOC) released a report on employment patterns in the tech industry titled "Diversity in High Tech." A segment of the report looked specifically at California’s Silicon Valley through data collected from 75 of the area’s top firms. The report found that, among executives, 57% of employees were white, 36% were Asian American, 1.6% were Hispanic and less than 1% were African American. These firms had a notable contrast in the demographics of professional as compared to management jobs (executives and managers combined). Asian Americans make up 50% of professional jobs among these firms while comprising 36% of management positions. White employees make up 41% of professional jobs and 57% of management jobs.

The EEOC report also found that, in the high tech sector, especially of Santa Clara Country, women were behind men in leadership positions and in technology jobs, as technicians and professionals. Nationwide, Blacks and Hispanics were disproportionately fewer in leadership positions and in technology jobs in the high tech sector. These groups had “negligible employment representation” in high tech industries in the San Francisco Bay Area. Asian Americans were represented in management and executive positions at a markedly lower rate than their representation in Professional occupations in the high tech industry both nationally and in the Silicon Valley. Among the top 75 Silicon Valley Tech firms, Women comprise 30% of total employment. Asians and Whites comprise 88% of total employment.

1. Research on Diversity in the Workforce. A 2015 study by the McKinsey & Company consulting firm found that the increase in women’s labor force participation in the U.S. over the past 40 years has accounted for about a quarter of current gross domestic product (GDP). The report estimated that $12 trillion could be added to global GDP by 2025 by advancing women's equality. The same study showed that companies with more diversity in leadership were 35% more likely to report financial returns above their national industry median.

A Bloomberg study found that companies where the diversity of their executive boards are in the top quartile enjoy significantly higher earnings and returns on equity than companies where the diversity of the executive boards are in the bottom quartile. Professor Kelli A. Green of the University of Florida wrote in 2015 that workforce diversity can bring an increase in morale, productivity, and competition.

A 2012 primer by the Congressional Research Service found that graduate enrollments in science and engineering grew 35% over the last decade with a growth in enrollment for groups generally under-represented in science and engineering. By demographic group there was a 65% increase among Hispanic students and a 50% increase among Black students.

Committee comments. Amendments taken in Assembly Appropriations address concerns raised in policy committee. The study now includes gender and LGBT elements, and specifically requests that the study be conducted by the Ralph J. Bunche Center for African American Studies at UCLA. Finally, several clarifying and technical changes were made.

Analysis Prepared by: Kevin J. Powers / HIGHER ED. / (916) 319-3960 FN: 0003397

Date of Hearing: May 9, 2018

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Lorena Gonzalez Fletcher, Chair

ABPCA Bill Id:AB 2819

Author:(Holden) – As Amended Ver:April 16, 2018

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY: This bill requests the University of California (UC) to conduct a study every other year, beginning in 2020 and continuing until 2030, on the racial and ethnic diversity of the board of directors and employees of California high technology companies, and would request that the study include, among other things, the number of people employed by the high technology industry of each race or ethnicity and of each gender.

FISCAL EFFECT:

$500,000 GF every two years until 2030 for UC to conduct the study.

COMMENTS:

1. Purpose. According to the author:

This bill will serve as a spring board to: address ethnic pay gaps, employment and outreach opportunities, board diversification, pipeline creation, upward mobility of diverse technical talent, and retention of that talent through company culture and development. This bill will also help us to understand where the current needs are to ensure access to underserved communities, and assist in efforts to increase diversity and inclusion efforts of the technology sector in Silicon Valley through the recruitment and retention of diverse talent in technical roles and corporate boards.

1. UC Research. The state sometimes tasks the UC to conduct research on its behalf. For example, the state provided $5 million over five years in the 2016-17 budget for the UC to conduct firearms research. In addition, the provisions of the Control, Regulate, and Tax Adult Use of Marijuana Act (Proposition 64), approved by voters in November 2016, designates a portion of revenues generated under the measure for UC to conduct research related to the measure’s implementation and effects, as well as the effects of marijuana as a pharmacological agent.

The author indicates UCLA’s Bunche Center for African American Studies could be an appropriate entity to perform this research as it has relevant expertise in the area this study seeks to address.

1. Staff Comments. This bill defines the scope of research to include publicly traded companies which a) have a primary trade or business in either software development or computational hardware, b) have a business location in California, c) have more than 1,000 employees in California, and d) are in the top 25 California high technology companies determined by total annual gross revenues. However, the bill does not specify whether the employees to be included in the study would be only those in residing California. For example, many technology companies have employees located in other states or abroad.

The bill also does not compel the companies to be included in this study to provide information for the study to the UC, presumably with the expectation companies will share information with the UC.

Lastly, for the frequency of the study, the bill references “biannual” in one portion and “every other year” in another. Staff understands author’s intent for the study to be every other year. Staff recommends a clarifying amendment and one that avoids use of the problematic word “biannual” altogether.

Analysis Prepared by: Natasha Collins / APPR. / (916) 319-2081

Date of Hearing: April 24, 2018

ASSEMBLY COMMITTEE ON HIGHER EDUCATION

Jose Medina, Chair

ABPCA Bill Id:AB 2819 (

Author:Holden) – As Amended Ver:April 16, 2018

SUBJECT: University of California: study: high technology companies: employees

SUMMARY: Requests the University of California (UC) to conduct a biennial study on the racial and ethnic diversity of the board of directors and employees of California high technology companies, and would request that the study include, among other things, the number of people employed by the high technology industry of each race or ethnicity and of each gender. Specifically, this bill:

1. Makes the following definitions:
   1. “California high technology company” means a publicly traded company whose primary trade or business is either software development or computational hardware that has a business location in this state and has more than 1,000 employees in this state.
   2. “High technology industry” means the top 25 California high technology companies determined by total annual gross revenues.
2. Requests UC to conduct a biennial study on the racial and ethnic diversity of the board of directors and employees of California high technology companies, to include the following:
   1. The number of people employed by the high technology industry:
      1. Of each race or ethnicity;
      2. Of each gender;
      3. Employed as executives, senior officials, or managers categorized by race and gender;
      4. Categorized by job type, including management, technical, and administration, broken down by racial or ethnic and gender demographics;
   2. The number of people on all companies’ boards of directors categorized by race and gender;
   3. Any program or programs implemented by a California high technology company in the high technology industry that are intended to outreach to, recruit, and retain diverse or underrepresented talent along with an investigation into the perceived effectiveness of those programs. The effectiveness may be evaluated by any changes to the company’s employee demographics due to implementation of the program or programs. The investigation may include research into possible reasons as to any discrepancies in effort as compared to the effectiveness of any program for each California high technology company; and,
   4. The graduation data of undergraduate and graduate students from science, technology, engineering, and mathematics fields in this state. The data may include the type of degree, the degree field, geographical regions where the degree is received, and the race and gender of the students;
3. The University of California is requested to submit a report to the Legislature and to post a report of the study on its Internet Web site on or before January 1, 2020, and every two years thereafter, until January 1, 2030.
4. Establishes the intent of the Legislature to enact legislation that would:
   1. Increase diversity and inclusion efforts of the technology sector in Silicon Valley through the recruitment and retention of diverse talent in technical roles and corporate boards;
   2. Address ethnic pay gap, employment and outreach opportunities, board diversification, pipeline creation, upward mobility of diverse technical talent, and retention of that talent through company culture and development; and,
   3. Work with the technology sector to understand where the current needs are to ensure access to underserved communities.
5. Makes findings and declarations, as specified.

EXISTING LAW: Establishes the UC, under the administration of the Regents of the UC. The California Constitution provides that the University of California constitutes a public trust administered by the Regents of the University of California, a corporation in the form of a board, with full powers of organization and government, subject to legislative control only for specified purposes. (Article IX Section 9 of the California Constitution)

FISCAL EFFECT: Unknown.

COMMENTS: Need for the bill. According to the author, “AB 2819 requests the University of California to conduct a biannual study on the racial and ethnic diversity of the board of directors and employees of California high technology companies. The study will include programs and best practices that seek to diversify the technology workforce.”

“This bill will serve as a spring board to: address ethnic pay gaps, employment and outreach opportunities, board diversification, pipeline creation, upward mobility of diverse technical talent, and retention of that talent through company culture and development. This bill will also help us to understand where the current needs are to ensure access to underserved communities, and assist in efforts to increase diversity and inclusion efforts of the technology sector in Silicon Valley through the recruitment and retention of diverse talent in technical roles and corporate boards.”

Background. Diversity in California’s technology workforce has long been an issue of interest to the Legislature. The Assembly Committee on Jobs, Economic Development, and the Economy (JEDE) prepared a preliminary set of information on diversity within the high technology-based industries, with a focus on the Silicon Valley in June 2016. Some of the data collected by JEDE includes:

1. Sex and Gender Diversity in the Silicon Valley. According to the Bureau of Labor Statistics, women make up nearly half the total work force in the U.S. Within the tech field, they are about 20% of software developers and about 39% of web developers. In a 2015 study of Silicon Valley executives and tech leaders prepared by The Atlantic, 63% of respondents rated the severity of sexism in the tech industry on a scale of 1 to 10 at 7 or higher. In 2013, 26% of computing jobs in the U.S. were held by women, down from 35% in 1990, according to the study released in 2016 by the American Association of University Women.

At Google, women make up 30% of the company's overall workforce, but hold 17% of the company's tech jobs. At Facebook, women comprise 29% of the overall workforce but hold 15% of tech roles. At Twitter, women comprise 10% of tech jobs, though for non-technical jobs the gender split is 50-50.

1. Racial and Ethnic Diversity in the Silicon Valley. The Silicon Valley Index, an annual publication of Joint Venture Silicon Valley Institute for Regional Studies, reported in 2012 that the Silicon Valley has a higher percentage of foreign born residents (36.4%) than California (27.1%) and the U.S. (13.0%). Silicon Valley tech companies have a heavy reliance on the H-1B visa program, which allows US firms to import up to 65,000 foreign workers each year to fill jobs that require "specialized knowledge." In 2012, more than 40% of the H-1B workers in the U.S. came from India, China, or South Korea.

In regards to start-ups, black founders are just 1% of venture-invested firms, according to a 2011 survey by CB Insights. According to the Bureau of Labor Statistics, 4% of employed software developers in the U.S. are Black, 5% are Hispanic, and 29% are Asian,. Comparatively, 1% of Google’s tech workforce is Black, 2% is Hispanic and 34% is Asian.

The investigative journal Mother Jones filed a Freedom of Information Act request and obtained data on the workforce diversity of Silicon Valley’s top ten tech firms for 2012. Among those top 10 companies, 70% of the total workforce was male, 63% of the total workforce was White, 25% Asian, 4% Black, and 6% Hispanic. When looking at the executives and top managers of these 10 companies, it was found 83% were white, 83% were male, 13% were Asian, 1% was black, and 3% were Hispanic. For comparison, the California workforce was 55% male, 44% White, 13% Asian, 7% Black, and 34% Hispanic.

In response to growing public pressure, in 2014 top Silicon Valley firms began disclosing their diversity data and taking steps towards remedying their diversity problem. For example, Intel pledged that its workforce would reflect the broader U.S. labor pool by 2020, and it created a $300 million venture fund designated for minority-led start-ups; Facebook expanded its summer internship program for minority computer science majors and started a new internship for minority business majors; and Google began investing in and hiring from historically black colleges.

In May 2016 the Equal Employment Opportunities Commission (EEOC) released a report on employment patterns in the tech industry titled “Diversity in High Tech.” A segment of the report looked specifically at California’s Silicon Valley through data collected from 75 of the area’s top firms. The report found that, among executives, 57% of employees were white, 36% were Asian American, 1.6% were Hispanic and less than 1% were African American. These firms had a notable contrast in the demographics of professional as compared to management jobs (executives and managers combined). Asian Americans make up 50% of professional jobs among these firms while comprising 36% of management positions. White employees make up 41% of professional jobs and 57% of management jobs.

The EEOC report also found that, in the high tech sector, especially of Santa Clara Country, women were behind men in leadership positions and in technology jobs, as technicians and professionals. Nationwide, Blacks and Hispanics were disproportionately fewer in leadership positions and in technology jobs in the high tech sector. These groups had “negligible employment representation” in high tech industries in the San Francisco Bay Area. Asian Americans were represented in management and executive positions at a markedly lower rate than their representation in Professional occupations in the high tech industry both nationally and in the Silicon Valley. Among the top 75 Silicon Valley Tech firms, Women comprise 30% of total employment. Asians and Whites comprise 88% of total employment.

1. Research on Diversity in the Workforce. A 2015 study by the McKinsey & Company consulting firm found that the increase in women’s labor force participation in the U.S. over the past 40 years has accounted for about a quarter of current GDP. The report estimated that $12 trillion could be added to global GDP by 2025 by advancing women's equality. The same study showed that companies with more diversity in leadership were 35% more likely to report financial returns above their national industry median.

A Bloomberg study found that companies where the diversity of their executive boards are in the top quartile enjoy significantly higher earnings and returns on equity than companies where the diversity of the executive boards are in the bottom quartile. Professor Kelli A. Green of the University of Florida wrote in 2015 that workforce diversity can bring an increase in morale, productivity, and competition.

A 2012 primer by the Congressional Research Service found that graduate enrollments in science and engineering grew 35% over the last decade with a growth in enrollment for groups generally under-represented in science and engineering. By demographic group there was a 65% increase among Hispanic students and a 50% increase among Black students.

REGISTERED SUPPORT / OPPOSITION:

Support

None on file.

Opposition

None on file.

Analysis Prepared by: Kevin J. Powers / HIGHER ED. / (916) 319-3960