Job Creation

Victoria Schoenlaub

10 min Read Time | August 15th 2021

Key Takeaways

1

It is important to analyze the company's total impact in terms of its ability to create jobs. How many people has the company provided employment opportunities for?

2

The quality of the jobs the company has created is a key dimension that should be explored. Here you can provide information on wages, growth opportunities, and the overall wellbeing of the workforce.

3

Discuss the impact the company has had in its industry or geographical area on unemployment and economic prosperity.

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What is it?

Going beyond the stimulation of economic growth and decreasing unemployment, job creation has wider, long-term social impacts.

Job creation has broader societal benefits than providing jobs/employment. In fact, the impacts on communities and society at large lead to the payment of taxes, which allow for greater resources to be injected into society, fewer needs for social benefits, maintaining social cohesion, reducing crime, and increasing well-being/health.

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Impact assessment

In the introduction, provide some context on how job creation helps society using recognized and robust sources.

Then, at the core of the analysis, discuss:

  • How many jobs the company has created directly and indirectly in the last few years
  • The growth trends in their workforce.
  • Put this information into context; use industry, country, region employment data to help the readers understand the company’s impact.
  • Compare the salaries to the living wage, as the average salary might fulfill the basic necessities.

Comparison Scienarios:

If a company operates on a global scale and the industry-specific data for the industry average for salaries is not available -

Ideally, you would need to find the industry data, but as some companies have very limited data/transparency, the next best thing would be to use the sector data (which includes the industry that the company is in) rather than more general data (such as country stats).

EX: if the industry data for electricity/energy companies are missing, you could look into the utility sector data which includes energy, gas, and water.

Looking at the industries that are included in the sector, if they are too different/wide/too many industries, it may run the risk of being misleading. This would cause a problem, in which you could opt for another option:

If it is a US company mostly operating in the US (the US is an example, it can be any other country), you can use the country's average.

When an industry average does not exist for a specific country, but you have the company's average salary -
Compare the average salary to the country's living wage (or where its greatest employee base is).

If the data on the average salary exists for the company in question but not for the industry or country -

Option 1 (more favourable): Find at which level there is the greatest employee base. For example, are these white-collar jobs or blue-collar jobs? Use that to assess what their average salary is and then compare that to the living wage.

Option 2: (less favourable): You can only compare to competitors IF you take the average salary of the top five competitors (better if they are in the same country but if it is a multinational, then they need to have a strong global presence as well).

Caution: please avoid competitor comparisons when possible, as this has to do with relative impact. What is the absolute impact of job creation in terms of quantity and job quality?

In your analysis, you must go beyond the basic numbers provided in company reports that disclose how many jobs it provided and how many people were employed. Also, assess how much the company contributed to prosperity. Indeed, creating jobs is not enough to fully understand a company’s impact; you must go beyond the number of employees. Please also discuss are the quality of the jobs, average or median wages, and comparing this imploration to industry, country, or region statistics. For example, the average or median wage can be compared to the national wage average or the country’s calculated living wage.

Ensure you describe the type of employment and contract, to help readers assess the persistence of impact.

Helpful writing tips:


When ranges are given, preferably, you should use the average of the salaries; otherwise, you can use the median. Please ensure that the calculations are correct.

Please avoid discussing bonuses. This over-complexifies the analysis as it will significantly differ depending on business models, job roles, etc. Additionally, many companies did not give bonuses during COVID (which is understandable), but we cannot risk company bashing. So, stick to the base salary as a basis of measurement.

When researching the average salary of a company, make sure to look through 2-3 sources and pick the one that is closest to the industry average. Oftentimes, salaries significantly higher than the industry average include bonuses.

Other dimensions that can add value to this analysis are:

  • Assess whether the unemployment rate in the area has been reduced
  • Assess whether the company created employment where there was previously limited access
  • Assess whether the company brought significant improvements to a specific community or in secluded areas where job opportunities are scarce, wherever there are employment issues.
  • Assess whether poverty was reduced in low-income countries at the micro/macro level.


Please do not discuss:

  • Gender diversity in the workforce
  • Inclusion in the workforce
  • Workforce breakdown (i.e., managerial positions, BOD, etc.)
  • Job losses
  • Labour practices
  • Workforce health and safety



Describe the scale of the impact by taking into account:

1/ The breadth of the impact

  • Is the impact local, national, or global?

  • How many people are concerned? Thousands? Millions? Billions?

2/ The depth of the impact

  • Is the life of people concerned deeply affected, or does the issue just marginally impact them?

  • Are the changes brought by the issue profoundly changing society or the planet?

3/ The persistence of the impact

  • How long would the impact described last for? Months? Years? Decades?

  • How reversible is the impact described in the impact analysis? Can it be easily stopped/extended?


In your analysis, make sure you add value to your readers and go beyond the company’s CSR report by not merely reporting data from the company’s report but going the extra mile of providing additional metrics, studies, and sources to make your analysis robust and the impact value and scale are clear.

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