Effective employee communication linked to lower turnover, increased shareholder value: study

Watson Wyatt study finds employee communication is a business function that drives performance and contributes to the bottom line
|hrreporter.com|Last Updated: 11/18/2003


mployers looking to reduce employee turnover — and increase shareholder returns — might want to look at how effectively they are communicating with workers, according to a new study.

The study, by consulting firm Watson Wyatt, shows U.S. companies with the most effective employee communication programs provided a 26 per cent total return to shareholders from 1998 to 2002 compared to minus 15 per cent by firms that communicated the least effectively. It also found that a significant improvement in communication to employees is associated with a nearly 30 per cent increase in market value.