In today’s globalized and dynamically evolving employment landscape, organizations must develop and implement effective employer branding strategies to stay competitive and appealing. The Talent Shortage Survey by Manpower Group (2024) highlights a critical finding: 75% of employers struggle to find the talent they need. This scenario has propelled organizations to emphasize unique employer branding strategies, crucial for attracting and retaining top talent. Despite the importance of employer branding, there exists a limited understanding of its impact on HRM practices and employees’ perceptions of these practices. This research aims to bridge this gap by examining the correlation between HRM practices and employer branding, as viewed through the lens of organizational attractiveness from the employees’ perspective, and comparing perceptions across the private and public sectors.
Effective HRM practices are fundamental to superior organizational performance. Practices such as recruitment, training, performance appraisal, and employee rewards are designed to attract, develop, motivate, and retain employees (Schuler and Jackson, 1987). High-performance work systems (HPWS), which integrate HRM practices, individual behavior, and organizational performance, offer significant advantages. Although these practices’ benefits are evident, understanding employee perceptions of these practices is crucial since they directly affect attitudes and organization-fit (Boon et al., 2011).
The concept of employer branding, first defined by Ambler and Barrow (1996), emphasizes the combination of functional, economic, and psychological benefits offered to employees. Employer branding helps organizations create a clear, appealing identity both internally and externally, enhancing their attractiveness as employers (Lievens, 2007). This strategic process strengthens organizational commitment, loyalty, and productivity, offering a competitive edge in the talent marketplace (Barrow and Mosley, 2005).
Employer attractiveness is crucial as it embodies the benefits that a potential employee expects from working at a specific organization (Berthon et al., 2005). Attributes such as leadership, organizational culture, communication, and reward policies significantly shape this attractiveness (Love and Singh, 2011). Understanding employer attractiveness from the perspective of current employees, not just potential candidates, provides deeper insights into retaining talent and enhancing organizational appeal.
Combining theories of sign and social identity with HRM practices, this research formulates several hypotheses aimed at linking HRM practices with employer branding:
Data was gathered from 800 employees across various private and public sectors in the Western region of Romania, between November 2019 and February 2020. The sample included employees from small and medium enterprises (SMEs) and public organizations. A rational sampling method was used, with specific criteria ensuring representativeness and alignment with research objectives.
A comprehensive questionnaire consisting of two scales with Likert-type items was deployed: one assessing HRM practices and the other measuring organizational attractiveness. The HRM practices scale developed by Villajos et al. (2018) assesses practices such as training, rewards, performance appraisal, and work-life balance. The organizational attractiveness scale, adapted from Berthon et al. (2005), evaluates dimensions including economic, social, and developmental values.
Data analysis was performed in three stages using SPSS and R 4.1.0 (Lavaan package). Confirmatory and exploratory factor analyses validated the scales and tested the final model. The relationship between HRM practices and employer branding was examined through structural equation modeling (SEM).
Confirmatory factor analysis validated the eight HRM practices (training, rewards, appraisal, recruitment, salary, security, work balance, exit management). Good model fit indices confirmed the structure’s suitability for the sample (N=800).
Exploratory and confirmatory analyses refined the organizational attractiveness scale to seven dimensions: social, interest, economic, development, application, market, and work-life balance values. These dimensions were confirmed as significant in evaluating employer branding
SEM analyses indicated significant positive relationships between HRM practices and organizational attractiveness. Performance appraisal, training-development, and work-life balance practices had the strongest impact. Differences between private and public sectors were noted, emphasizing performance appraisal and safety in the private sector, and training-development in the public sector.
This research highlights that effective HRM practices significantly enhance internal organizational attractiveness and employer branding. Surprisingly, contingent rewards and safety practices showed a negative relationship, suggesting that well-branded employers offer intrinsic benefits beyond immediate financial rewards. The study underscores the importance of performance appraisals, training, and work-life balance in both private and public sectors, albeit with sector-specific nuances.
This study contributes to employer branding and HRM literature by confirming that strategic HRM practices enhance employer attractiveness internally. HR managers and branding specialists should focus on transparent performance appraisals, robust training programs, and flexible work arrangements to enhance their employer brand. Future research should explore these dynamics in post-pandemic contexts to adapt employer branding strategies to evolving workforce landscapes.
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