Over 300 companies across multiple industries spent more than $160 billion diversifying their supply chains, based on a recent report, which ended up supporting over 1.3 million jobs.

According to a study published December 2023 by the diversity and ESG data provider Supplier.io, entitled “Supplier Diversity Economic Impact Report – 2023,” participating companies generated $104 billion of income and $31.4 billion in tax revenues through diverse and small supplier spending over the past 12 months.

"Responsible sourcing is a competitive differentiator, which is why 97% of enterprise executives continue to support supplier diversity programs,” said Aylin Basom, CEO of Supplier.io. “By investing in small and diverse suppliers, companies are not only fostering innovation and enhancing their supply chain competitiveness but also effectively reducing risks and costs.”

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Total diverse and small supplier spending topped out at $160.1 billion, with total diverse supplier spending coming in at $33.4 billion, while total small supplier spending reached $126.8 billion. The money spent on small and diverse suppliers directly supported over 726,000 jobs with more than $60 billion of income.

The survey found the total economic impact of participating companies’ supplier diversification came in at $286.8 billion. $160.1 billion had a direct impact on businesses. $60 billion had an indirect impact on organizations, which measured what suppliers did to fulfill new incremental spending (fuel, transportation equipment, machinery, etc.). The final $66.7 billion had an induced impact, which measured household spending on expenditures like food, clothes, cars, etc.

With $35.7 billion in total direct spending, professional, scientific and technical services was the top purchasing category for small and diverse suppliers, supporting over 201,000 jobs. Wholesale trade had the second-highest total direct spending amongst small and diverse suppliers at $18.3 billion. Construction recorded the third-most total direct spending at $16.1 billion, supporting over 97,000 jobs.

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The survey found California was the U.S. state that had the most diverse and small business spending at $22.9 billion. Through this spending, the state was able to support over 196,000 jobs and create more than $18.1 billion in total income.

Conversely, the Virgin Islands had the lowest level of diverse and small business spending at $5.6 million as the territory was easily outpaced by the second-lowest spender (Alaska) by more than $176.6 million.

Supplier.io’s first-ever Supplier Diversity Economic Impact report analyzed data from 326 organizations that spent over $160 billion on more than 124,000 unique suppliers.