Lower Unemployment Rate Creates Need to Strengthen Your Employer Brand


November 8, 2016


180 Engineering

employment-contractWithin the past year, the unemployment rate in the United States has trended downward. Not only is the unemployment rate lower, BLS data reports that the number of quits (voluntary separations) is increasing year-over-year, due to employees securing opportunities they perceive to be better than their current position.

A related piece of intelligence is employee engagement. Gallup has been measuring employee engagement in the U.S. and around the world since 2000. Most recent research indicates that only 32% of employees in America feel “engaged” in their jobs.

Given the long and slow recovery from the Great Recession, much lower unemployment is wonderful news for the nation, but it will challenge many hiring organizations to revisit their approaches to recruiting, hiring, and talent retention. According to CareerBuilder’s 2016 Candidate Behavior Study, many organizations are still in a recession-era mindset that employees should consider themselves lucky to have jobs – current data tell us that this mindset needs to change, and change quickly.

Much lower unemployment levels, higher quit rates, and the lack of engagement among more than two-thirds of U.S. employees have created a very different environment from the one that many hiring organizations have operated within in recent years. Due to these changes in the market, employers will become increasingly challenged to strengthen their employer brands and improve employee engagement in order to stay competitive.

The call to strengthen employer brands raises questions: How does company culture and employer branding work together? What are the advantages to dedicating time and resources to strengthening your employer brand? As a first step, let’s be clear on definitions.

Company Culture

A company’s culture is the collection of values and behaviors that contribute to the unique social and psychological environment of an organization.

Employer Brand

The American Marketing Association defines the term brand as follows: “Name, term, design, symbol, or any other feature that identifies one seller’s goods or services as distinct from those of other sellers.”

According to the Society for Human Resource Management (SHRM), “An employer brand is an important part of the employee value proposition and is essentially what the organization communicates as its identity to both potential and current employees. It encompasses an organization’s mission, values, culture and personality.”

Branding, when thought of in the context of traditional marketing and advertising, is a strategic effort to make the unique essence and value of a product, service or organization known and exciting to a potential customer base. The core concepts of employer branding are the same as marketing products and services; however, the goal of employer branding is to make the unique essence of a company known and exciting to potential recruits, as well as current employees.

How Do Company Culture and Employer Brand Work Together?

Company culture and employer brand should be complementary. Company culture – a collection of values and behaviors – can generally only be known and understood by people with firsthand knowledge of or experience with the company. On the other hand, it is strategic and disciplined employer branding that allows company culture and other organizational attributes be known by people without firsthand experience with a given organization. Essentially, effective employer branding tells the story of a company in a provocative way that makes potential recruits and existing employees want to be associated with the company.

Effective brand building when selling a product creates an affinity for that product facilitating more sales and greater consumer loyalty. Likewise, effective employer branding creates an affinity for an organization that facilitates more efficient recruiting, the hiring of higher caliber talent, and stronger employee retention.

Having established what an employer brand is and how company culture and employer branding work together, what are some of the specific business benefits of building a strong employer brand?

  • More Effective Recruiting

Corporate Responsibility magazine’s Annual Corporate Reputation Survey revealed that 86% of American women and 67% of American men would not take a job with a company that does not have a good reputation.4 Additionally, 76% of prospective job applicants want details about what makes a company an attractive place to work.

Given that the internet has created tremendous visibility into nearly all organizations, it is critical to manage one’s employer brand strategically – of course, reputation is an integral part of an employer’s brand. A poor, or poorly managed, employer brand will make attracting talent both extremely difficult and costly.

Let’s look at another way in which a strong employer brand strengthens recruiting efforts. Hiring organizations often, rightfully, talk about wanting to hire the “best talent” or the “best person” for a given job. Additionally, candidates want to find a job that is a good fit for them within an organization they will enjoy working for. According to the 2016 edition of CareerBuilder’s Candidate Behavior study, 50% of candidates wonder, “Are they looking for someone like me?” when reviewing job listings.

Hiring organizations and candidates alike know that a match that looks good on paper may not be the best fit in practice. For example, an electrical engineering position becomes available within an automotive company. A candidate may be the perfect fit based on his or her knowledge, skills, and background. However, we know if the car company has a collaborative and agile project management culture, and the candidate prefers to work independently, it is likely not a good match.

Strategic employer brand building helps potential recruits understand company culture and expectations allowing them to better conclude if they would be a good fit for the company and position or not.

  • Lower Recruiting Costs

Employer Brand International’s “Employer Branding Global Trends” study notes that employers with a strong employer brand enjoy a 22% reduction in recruitment costs and 19% higher job offer acceptance rates than those with poorly defined brands.

One way hiring organizations can reduce their recruitment costs is by developing well-constructed internal referral programs. However,this is another example of where culture and branding must work together. According to December 2015 data from Glassdoor Data Labs, fewer than half (49%) of employees would recommend their employer to a friend. A thoughtful employer cultural development and branding program that fosters employee enthusiasm and affinity will greatly increase referral program participation.

  • Stronger Employee Retention and Engagement

Retaining desirable employees – employees whose skills and approaches align well with company’s needs and culture – is an extremely beneficial result of strategic employer branding and employee engagement programs.

However, Corporate Responsibility magazine’s Employment Cost of a Bad Reputation survey found that 84% of employees would consider leaving their current jobs if offered another role with a company that had an excellent reputation.

To reduce employee turnover, strengthen your company’s reputation by listening to feedback, implementing changes when needed, and making sure your company’s mission and culture are well-entrenched within your organization via employer branding and employee engagement programs.

Another employer branding tactic that helps with both recruiting and employee retention is communicating honestly what it’s like to work for your organization. Through this approach to communication, you will set expectations about what it means to be a successful employee at your company. You can showcase the skills and traits that are highly valued in your organization, so that new hires know to emulate them upon starting. This approach also resonates with job seekers who are willing and able to meet these expectations. As a result, individuals who apply and are hired are more likely to have a better experience working for you, and they are less likely to leave your organization.

In short, successful employer branding can reduce employee turnover by nearly two-thirds. You can experience greater employee retention and overall superior performance compared to organizations with a weak employer brand.

The high unemployment rates during the recession and recovery years caused many industry segments and companies to lessen their focus on employer brand-building. However, as the recovery continues and the competition for talent increases, once again, employer brand-building is a top priority for many companies for good reasons – more effective recruiting, lower recruiting costs, and stronger employee retention and engagement.


  1. “The Employment Situation – August 2016,” Bureau of Labor Statistics (BLS) press release, September 2, 2016
  2. “The Worldwide Employee Engagement Crisis,” Gallup, January 2016
  3. Career Builder’s 2016 Candidate Behavior Study
  4. Annual Corporate Reputation Survey (2015 edition), Corporate Responsibility magazine
  5. Glassdoor survey, October 2014
  6. “Employer Branding Global Trends,” Employer Brand International
  7. “Human Capital Benchmarking Report,” Society for Human Resource Management (SHRM’s)
  8. Glassdoor Data Labs December 2015
  9. “Employment Cost of a Bad Reputation,” Corporate Responsibility magazine
  10. “Elevating Employer Branding,” HRO Today
  11. “The Employer Brand,” Journal of Brand Management