New Academic Research with Glassdoor Data

As the research arm of Glassdoor, one of our goals is to help open up our amazing database of crowd-sourced salaries, company reviews and job postings to academic researchers around the world.

With data on job postings, pay and company culture for more than 580,000 companies, Glassdoor offers a unique view of trends in the labor market including corporate culture, workplace benefits, CEO performance and more. And our data reach far beyond the U.S., with information for 190 countries around the globe.

In the past year we’ve collaborated with dozens of researchers at universities around the world. These researchers have used Glassdoor data to shed light on a variety of fascinating trends in labor economics, finance, and organizational behavior.

Here are just a few samples of recent academic research drawing on Glassdoor data.

What Drives Tech Company Culture?
When it comes to employer branding, a common question we hear is, “What type of company are we in the eyes of prospective employees?” One powerful answer comes from the actual language used by employees in Glassdoor reviews.

That’s the subject of a new study from four researchers at the University of Liechtenstein and the IT University of Copenhagen. It examines culture in the tech industry based on a deep linguistic analysis of Glassdoor reviews.

The study examined 112,610 employee reviews for companies in the information technology (IT) industry. Using a sophisticated machine learning model, the researchers identified cultural themes appearing in the text of employee reviews, such as gender fairness, a culture of performance and learning, assertiveness in the workplace and more.

The study then examined which of these cultural themes were associated with stronger employee motivation in tech. They found cultures with a “fast pace,” “career opportunities,” “learning,” and “unbureaucratic organization” were powerful statistical drivers of employee satisfaction in tech workplaces. By contrast, themes like “gender inequality,” “bad management,” and “short-term focus” were linked to significantly lower employee morale.

This research is groundbreaking because it offers employers a new way to scientifically assess their employer brand and culture that relies only on crowd-sourced employee sentiment—which is readily at their fingertips for free on sites like Glassdoor.

Employee Happiness and Performance
To economists, the holy grail of workplace culture is knowing whether more satisfied workers actually lead to better financial performance. Ultimately, that is the core question facing C-suite executives making decisions about whether to invest in improving their corporate culture.

Our own research on the subject points to a clear link between Glassdoor’s “Best Places to Work” and stock market performance, and this has been an active area of research for outside academics using Glassdoor data in recent years.

Two recent studies have added to our understanding of whether Glassdoor reviews predict company financial performance.

The first study is from three researchers from the University of Las Palmas de Gran Canaria. They examined the statistical link between company “star” ratings on Glassdoor and several measures of financial performance, including company return on assets, operating margins and revenue per employee.

Based on 60,990 Glassdoor reviews for 475 companies, they found several Glassdoor ratings predicted company financial performance, including ratings for senior leadership, career opportunities, and compensation and benefits. Interestingly, they find one aspect of company culture actually predicted lower financial performance for these employers: work-life balance.

All else equal, employees clearly value work-life balance. But there is growing evidence that—unlike satisfaction with senior leadership, compensation and benefits, and career opportunities—work-life balance is not a key driver of company bottom lines.

Do Markets Value Good Culture?
In a second recent study, a researcher from Erasmus University examined the link between company culture and stock performance from a different angle. When stock market analysts value publicly traded companies, do they overlook the intangible benefits of great company culture?

Using 417,645 Glassdoor reviews for 2,237 U.S. companies, this study examined the language used in employee reviews to identify “performance-orientated” companies. The author then examined whether these companies were more profitable, and whether they experienced more “earnings surprises” in which stock market analysts overlooked evidence of company performance contained in Glassdoor reviews.

Perhaps not surprisingly, the author found companies with more “performance-oriented” language in Glassdoor reviews were significantly more profitable, and were more likely to experience earnings surprises. This squares up with other research showing markets often don’t correctly value intangible aspects of companies like strong workplace culture.

The value of online employee sentiment continues to be studied, and it’s a booming area among academic researchers—something Glassdoor data has proven to offer a unique window into.

For more updates on the latest research from Glassdoor, follow @adchamberlain on Twitter and subscribe to Glassdoor Economic Research.