Abstract:

Organization must rethink the relationship with its employees in order to compete in this rapidly changing business world. As market demands for innovation, this rapid change require employees to be involved in various ways with their work & company, communication is needed between the management and employees. Internal communication is one of the channel to influence employee engagement, improve employer branding and increase employee retention as attracting and retaining highly talented employees. The purpose of this study was to understand the effect of internal communication on employer branding & employee retention through employee engagement. Structural equation modeling (SEM) was served to analyze collected questionnaires. The results showed that internal communication had significant effect to employee engagement and employer branding but not to employee retention, and employee engagement significantly affected employer branding and employer branding significantly affected employee retention. The results were expected to consider internal communication as strategic management tools.