Flipping the multiple makes it comparable with discount-rate inputs and with government bond yields. A 4% earnings yield against a 4.5% ten-year bond tells a different story from the same yield against a 1% bond.
It also handles loss-making companies more gracefully than a pe-ratio, which becomes meaningless when earnings are negative, and it can be applied at the enterprise level by dividing after-tax operating-income by enterprise value.
Example: Northwind Tools earns $0.81 on a $26 price, a 3.1% trailing earnings yield. The after-tax EBIT yield on enterprise value is $91M over $2.86B, or 3.2%.
Related: trailing-pe, free-cash-flow-yield, discount-rate, pe-ratio, cost-of-equity