Strong employer brands see higher stock returns
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Happy employees are good for business, according to a new report by Charter and hiring platform Welcome to the Jungle.
Why it matters: Employer brand and worker sentiment have taken a back seat amid economic uncertainty, tight labor market and shifting workplace dynamics.
Yes, but: Companies with strong employer brands and high worker sentiment had significantly greater revenue growth and total stock returns over 10 years, the report finds.
State of play: Tech companies with the highest employee sentiment scores — Salesforce, Alphabet and HP — saw significantly higher stock market returns than those with less positive sentiment— Atlassian, PayPal and Verizon.
- The correlation was observed within the financial sector too, per the report.
- JPMorgan Chase and Bank of America outperformed Citigroup and US Bancorp in worker sentiment, revenue and stock returns.
Zoom in: Companies with high scores for "communicates a clear mission" — which include Alphabet and JPMorgan — consistently outperformed peers financially too.
- This suggests clear internal communication helps align employees to the company's goals, which leads to more growth and better business performance, according to the report.
Between the lines: Work-life balance is the key driver of positive worker sentiment, followed by total compensation and benefits and opportunities for advancement.
- Only 27% point to flexibility or remote work and only 10% say diversity, equity and inclusion are signs of a good employer.
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