Disparity Studies and How They Help MWBEs

2 Minutes Read

The City of Richmond, VA has commissioned a 2022 disparity study led by MGT Consulting Group.  As a government contractor, you may have heard of disparity studies but are not quite sure what they are or why your business should participate in them. Disparity studies help to identify whether there is a disparity (a significant difference) in the utilization of businesses by race, ethnicity, and gender in government contracting. They are important because they can help to level the playing field for smaller businesses and businesses owned by women and minorities. If your business is found to be underutilized, you may be able to receive special assistance from the government in order to compete for contracts. Therefore, it is beneficial for your business to participate in a disparity study.

As members of the project team, Greensboro Staffing Consultants has prepared this article to answer some of the frequently asked questions government contractors have regarding disparity studies.

What is a disparity study?

A disparity study is an analysis of whether there is a difference in the way that minority- and women-owned businesses (MWBEs) are treated compared to non-minority and male-owned businesses in the awarding of government contracts.

For municipalities like the City of Richmond, a disparity study can be a critical tool in understanding the equity of their procurement system. A disparity study is an analysis to determine disparities in how contracts with the City of Richmond are awarded between minority- and women-owned businesses (MWBEs) and non-minority or male-owned businesses. The City of Richmond uses this type of analysis to identify any areas where these businesses are shut out from receiving opportunities with the municipality. Such a study looks closely at factors like eligibility criteria, soliciting process, contract award decisions, and post-award management among others. By examining all of these aspects together, City leaders have the information needed to make sure all vendors receive fair access to contracts.

How disparity studies help government contractors

Disparity studies help to identify potential discrimination in the contracting process so that corrective measures can be taken.

Disparity studies are an essential tool in helping the City of Richmond identify potential discrimination in government contracting. By comparing contracts granted to those contractors that have characteristics established by federal and state law as protected classes (race, ethnicity, gender, etc.), the City of Richmond is able to find suspected disparities in awards for contracts and make corrections before any bias can be further entrenched. This ensures that government contracting is open to all qualified individuals and it helps promote a level playing field with fair opportunity for possible contractors from traditionally underrepresented groups.

How they work

Disparity studies usually involve collecting data on the number of MWBEs that participate in the contracting process, comparing those numbers to the overall number of MWBEs in the relevant market, and then assessing whether there is a statistically significant difference between the two groups.

MGT Consulting Group specializes in providing comprehensive disparity studies that answer two basic questions: do MWBEs have equal access to contracting opportunities and what are the reasons behind any discrepancies highlighted by the data? To facilitate this study, they analyze the data on MWBEs who participate in the contracting process and compare it to those MWBEs who are available in the respective market. After a thorough assessment of both sets of figures, MGT Consulting Group can determine whether there is a statistically significant difference between them. Armed with this information, the City of Richmond can then make decisions that promote equality and access to contracting opportunities for MWBEs.

For more information about the City of Richmond's 2022 Disparity Study, please visit: https://richmondvadisparitystudy.com.