Research Shows the Benefits of Top Workplaces Recognition

by Bob Helbig

Award-Winning Companies Attract Better Job Candidates and have Lower Turnover

Companies that earn recognition as top workplaces attract more highly qualified job applicants and experience reduced employee turnover, new research shows.

The findings, published in the Academy of Management Journal, support the benefits of third-party verification programs such as Top Workplaces, which has ranked quality companies across the United States since 2006.

“While managers, recruiters, and advertising can say a company is a great place to work, third-party branding from an external source sends a more credible signal,” said Professor David G. Allen, the study’s co-author and Chair of the Department of Human Resource Management at the Rutgers School of Management and Labor Relations.

This study examined more than 600 companies in North America that participated in a workplace rating competition from 2011 to 2013. Among the conclusions drawn by research:

  • Third-party employment branding efforts can reduce turnover rates. This is regardless of the size of the company or the number of industry job openings.TWP_Portrait_Generic
  • Credible third-party employer branding can make employees feel better about an organization, giving them more reason to stay.
  • When organizations win recognition as a quality workplace, turnover rates drop, particularly after the first year of certification.
  • Certifications can improve job applicant pool quality at smaller organizations, “perhaps by better-attracting higher quality job seekers who previously only considered larger firms with more established reputations.”
  • When job openings are scarce, certifications improve job applicant pool quality by helping job-seekers “focus their time and energy on firms more likely to be an appropriate fit.”

Allen and Brian R. Dineen of Purdue University authored the study. Their research was funded by the SHRM Foundation, the charitable arm of the Society for Human Resource Management.