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Workforce Diversity and Profit (AQA Paper 1 2020, Q18)


Last updated 22 Jun 2021

Here's a suggested answer for a 9-mark question on how increasing workforce diversity might increase the profit of a business.

Workforce Diversity and Profit | AQA A Level Business | 2020 P1 Q18

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Possible response

If employing a more diverse workforce lowers labour turnover in a business, this should increase profit. Businesses with a diverse workforce are generally more inclusive of different individual characteristics and perspectives, which in turn should cause more employees to feel accepted and valued. When this happens, employees are also happier in their workplace and often stay longer with a business, thereby reducing labour turnover. This should reduce the costs of recruitment and training that firms with high labour turnover often suffer from. Other costs associated with high labour turnover should also fall - such as poor quality output and potentially lost revenues as a result of not having enough of, or the right staff. By lowering all these costs, profits should increase.

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