Does Salary Matter? Role of Salary in the Effects of Corporate Image on Organization Attraction

Summary

The paper, "Does Salary Matter? Role of Salary in the Effects of Corporate Image on Organization Attraction," by Chi, Shih, and Lai (2017), explores the critical function of salary in shaping how corporate image impacts an organization's attractiveness to potential employees. The researchers acknowledge the persistent challenge faced by enterprises in attracting applicants, highlighting that corporate image significantly influences how individuals perceive and are drawn to an organization. The study's motivation stems from the observation that while corporate image is recognized as a vital factor, the specific role of salary within this dynamic, particularly as a mediating variable, warrants deeper investigation. This is especially pertinent given the increasing difficulty Taiwan faces in attracting senior talents, as indicated by its ranking (No. 23) in global talent competitiveness at the time of the paper's publication. The authors aimed to delve into how the salary system specifically mediates the effect of corporate image on organizational attraction. Methodologically, the study employed a quantitative approach, analyzing data from a sample size of 224 participants. To assess the mediating role of salary, the researchers utilized bootstrap analysis for indirect effects, a robust statistical technique suitable for examining mediation in relationships between variables. The independent variable was corporate image, organizational attraction served as the dependent variable, and salary was conceptualized and tested as the mediating variable. The findings revealed a statistically significant positive indirect effect, indicating that salary indeed mediates the relationship between corporate image and organizational attraction. Specifically, the bootstrap results showed a mean effect value of 0.2389, demonstrating a substantial mediating influence. This implies that a strong corporate image alone may not be sufficient to attract talent if not complemented by an appealing salary system. The implications of these findings are substantial for organizations, particularly those operating in competitive talent markets like Taiwan. The research suggests that rather than simply offering salary figures, enterprises should strategically communicate an attractive pay and benefit system to prospective employees. A well-structured and desirable salary system not only provides a sense of security and motivation for good performance but also significantly contributes to a positive corporate image, thereby bolstering an organization's overall attractiveness. For enterprises striving to enhance their competitiveness and secure top talent, the study underscores the necessity of integrating a compelling salary strategy with their corporate image management efforts. This holistic approach can lead to greater organizational attraction, allowing companies to recruit more effectively and gain an edge in the pursuit of skilled professionals.