This paper analyzes the relationship between employee satisfaction and long-run stock returns. A value-weighted portfolio ofthe ‘‘100 Best Companies to Work For in America’’ (Levering, Moskowitz, and Katz, 1984; Levering and Moskowitz, 1993) earned a four-factor alpha of 0.29% per month from 1984 to 2009, or 3.5% per year. These figures exclude any event-study reaction to list inclusion and capture only long-run drift. When compared to industry-matched benchmarks, the alpha remains a statistically significant 2.1%.
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