The Geography of U.S. Companies That Care About Their Employees

Abstract

Investment in employees is increasingly vital for fostering a sustainable and inclusive workplace. While past research has linked investment in employees (i.e., financial benefits and well-being efforts) to individual company performance, it mainly overlooked how these benefits relate to a broader state level. Our study gathered over 350,000 employee reviews of 104 major U.S. companies from 2008 to 2020, used deep learning to assess company investment in employees in these reviews, and associated these companies with the U.S. states in which they are located. Based on a state-level factor analysis, we discovered that there are two main facets that relate to investment in employees: one with primary focus on financial benefits; and a more comprehensive one that, in addition to financial, incorporates a set of other, more intangible benefits, such as as health, education, diversity, infrastructure and atmosphere. We then found that states hosting companies investing in the latter facet tended to be economically prosperous, and attractive to the “creative class.” This fresh perspective on internal corporate efforts has significant implications for economic geography, workplaces, and the computational social science literature.