Below is a link to a very interesting article in BusinessWeek which basically states that managers cannot reward and keep employees just because they are loyal but they must also be high performers.
While I completely agree, it just makes good sense to keep your best performers. Especially given a study late last year by Leadership IQ which found almost half of high performers were looking for a job.
I would argue that if employee loyalty is measured the right way, then high levels of employee loyalty often correlate to high levels of performance. Companies that are taking the time now, during these tough times, to engender employee loyalty are more likely to have productive employees that will have a positive impact on the bottom line. While the relationship is not perfect, you will have high performers who are not loyalty and low performers who are very loyal, the correlation between loyalty and performance is significant.