Journal
of International
Studies
Impact of job satisfaction on employee turnover:
An empirical study of Autonomous Medical Institutions of Pakistan
© Foundation
of International
Studies, 2014
© CSR, 2014
Alamdar Hussain Khan,
University of the Punjab,
Lahore, Pakistan.
alamdarbaloch@ymail.com
Muhammad Aleem
University of the Punjab,
Lahore, Pakistan.
alamdarbaloch@ymail.com
Abstract. The Health sector in the Pakistan is facing many problems to provide the Health
facilities to the masses spread over the country. The most challenging problem is the
shortage of Doctor’s as compared to the population. Most of the professional Doctor’s prefers to serve in the abroad instead to serve in Pakistan. There are the many
determinants of turnover in the Health Department. The objective of this study is to
investigate the factors such as Pay, Promotion, Job Safety and Security, Nature of the
Work that effect the job satisfaction level and that are the cause of turnover of employee’s in the Autonomous Medical Health Institutions in the Pakistan. The factors
of job satisfaction are such as Pay, Promotion, Job Safety and Security, Nature of the
Work. The sample of the research is consist of 200 doctors, nurses, administrative and
accounts staff working in Autonomous Medical Health institutions in the Punjab.
Out of total 270 Questionnaires distributed in the Autonomous Medical Institutions
of the Punjab 200 were received back and used for analysis. For data analysis/results
the SPSS 20.0 is used.
Received:
January, 2014
1st Revision:
April, 2014
Accepted:
May, 2014
DOI:
10.14254/20718330.2014/7-1/11
Key words: Turnover, job satisfaction, Medical Institutions, Pakistan, doctors
JEL Classification: J63, J28
INTRODUCTION
In the organization the Human Resources are the life blood of life. It is difficult for the organization
to compete in the current era of competition without the loyal and competent Human Resource. The loyal
employees are the most productive and a source for the development of the organization and vice versa. It
becomes challenge for the Human Resource Managers to retain the employees for long period and to minimize the turnover in the organization. The high turnover of employees in the organization increases the cost
122
Scientific Papers
Alamdar Hussain Khan, Muhammad Aleem “Impact of job satisfaction on employee turnover: An empirical study
of Autonomous Medical Institutions of Pakistan”, Journal of International Studies, Vol. 7, No 1, 2014, pp. 122-132.
DOI: 10.14254/2071-8330.2014/7-1/11
Alamdar Hussain Khan, Muhammad Aleem
Impact of job satisfaction on employee turnover:
An empirical study of Autonomous Medical Institutions of Pakistan
of hiring new workforce and decrease the productively. An organization can gain the competitive advantage
due to retaining of qualified, productive and loyal work force. The turnover is the most focused area by the
scholars, academicians, researchers and the human resource managers. The employee retention is also considered the input for improving the financial performance of the organization (Raikes & Vernier 2004). The
outcome of the increased level of turnover in the organization is also in the form of indirect cost like burden
on the existing workforce, loss of social capital and low morale. (Des & Shaw 2001).
The increasing trend of turnover enhances the cost and reduces the productivity and efficiency of the
organization. Hence, it is crucial to study the factors affecting the turnover in the organizations.
For the opulence of the organization the human resource management becomes a momentous aspect
for the organization. These are the human who are the foundation for the development and achieving the
objectives of the organization. In this modern age, human are considered the most precious assets that
impact on the performance. (Kabene et al, 2006). In the health sector, doctors are the most valuable assets
and prominent role for the achieving the government objective to provide the maximum health facilities to
the public. .Like other assets, human assets requires the proper management. Hence without the developed
system of human resource, it is difficult to manage and retained the doctors.
There is the emerging issue in Pakistan is the doctor’s strikes against the government in the hospitals
that their demands are not fulfilled. The young doctor’s protests also affect the patients in the hospitals. Due
to the absence of the doctors, 60% clinics and hospitals were shut down and resultantly 500 patients were
expired. (Kazmi,2011). Moreover again on 16th April 2012, there was strike in the hospitals and demanded
the service structure from the government. As per daily-times newspaper 2 July 2012, there is the service
structure for the doctors but is not implemented with letter and spirit which requires improvement according to Masood sheikh. With the proper implementation of the service structure 13000 doctors awaited from
the last 16 to 20 years will be promoted in the next grade. Hence, this is the most crucial issue and requires
the government attention as the government has to provide the health facilities to the public. The patients
are only treated by the doctors and there is no alternative available. (FRANKLIN, 2006). The employee
turnover, absentism, is the outcome of the job dissatisfaction. The employee job satisfaction is very vital for
the organization to retain the employees for the longer period.
The objective of this paper is to find out the factors like Pay, Promotion, Job Safety and Security, Nature
of the Work that effect the level of job satisfaction. Furthermore the effect of job satisfaction on turnover
of Medical Sector employees from Pakistan to abroad and retaining the employees for the longer period
in the Department.
LITERATURE REVIEW
In this section the factors affecting the turnover in the organization are explained.
Impact of Rewards/pay on Job satisfaction and Employee Turnover
The scholars studied the public sector managers to find out the determinants of job satisfaction and
it was concluded that the job satisfaction level of a employee is significantly effected by the compensation
practices in the organization (Sokoya 2000).
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Vol. 7, No.1, 2014
Opkara (2002) in the study found that there are the certain factors that influence the level of job satisfaction of the employee. These are the compensation, promotion opportunities, the work itself, relationships
with co-workers and the supervision. The pay was considered the dominant factor in measuring the job
satisfaction of employee. Similarly another study was conducted by the Frye (2004) and it was concluded
that the compensation is the most critical factor for the organizations to magnetize the right workforce and
retain them for the long period of time. In addition to that the compensation is positively correlated with
the job satisfaction of a employee in the organization. Another study was also conducted that to found the
effect of pay on the job satisfaction and it was concluded that the there is positive relationship between job
satisfaction and pay (Nguyen et al. 2003)
It was found that the lower level of compensation is the cause of employee turnover (Abassi and Hollman 2000). The study also concluded that improper recruitment, bad working conditions, less compensation has negative effect on the employee turnover (Milman 2002). Furthermore the job satisfaction increases
with better pay and fringe benefits and decreases the turnover of the employees (Beilock and Capelle 1990).
In the context of Literature Review we Hypothesis:
H1: Pay is positively correlated with the job satisfaction.
H2: Pay is negatively correlated with the employee turnover.
Impact of Promotion on Job satisfaction and Employee Turnover
The scholars investigated the relationship of jobs satisfaction with demographic determinants as well as
the other factors like job autonomy, leadership behavior and promotion system. I was concluded that the
factors significantly affect the job satisfaction of employees (Dawson, 1987). Furthermore the Nguyen, Taylor, & Bradley (2003) also found the satisfaction level of employee is affected with existence of promotion
opportunities in the organization.
An organization to retain its workforce for a long period of time has to make investment for the career
advancement of Human Resource. (Hall & Moss, 1998; Hsu, Jiang, Klein & Tang, 2003; Steel et al., 2002;
Woodruffe, 1999). The absence of promotion and training opportunities is the cause for the talented employees to quit the organization. Due to high ratio of turnover the career growth in such organization are
decreased. (Shore & Griffeth, 2003; Steel et al., 2002). The organizations require the brilliant workforce to
get the competitive advantage and employees want to grow and develop their career. (Prince, 2005). In the
light of previous research we hypothesis that:
H3: Promotion is positively correlated with the job satisfaction.
H4: Promotion is negatively correlated with the employee turnover.
Impact of Working Conditions on Job satisfaction and Employee Turnover
Hytter (2008) explained that the work environment is considered in the context of industrial environment like clamor, lifts etc. The attributes of work environment are different in the service sector as compared
to industrial sector as it deals with the clients (Normann 1986). The working environment is considered
the most significant factor of job satisfaction. (Spector 2008). The other researcher in their study found
that work environment is also a superior predictor of employee job satisfaction in the organization setting
(Reiner and Zhao, 1999; Carlan, 2007; Ellickson and Logsdon, 2001; Forsyth and Copes, 1994). Moreover
124
Alamdar Hussain Khan, Muhammad Aleem
Impact of job satisfaction on employee turnover:
An empirical study of Autonomous Medical Institutions of Pakistan
variation exists in terms of pay packages, working conditions, incentives, recognition and fringe benefits for
the employees (Lavy, 2007). In the past studies it was found by the scholars that there are numerous factors
are crucial in retaining the workforce. These are like work life balance, work environment and career opportunities (Cappelli 2000:104). The Literature Review thus supported the hypothesis as under:
It supports the following hypothesis:
H5: The working conditions are positively correlated with the job satisfaction.
H6: The working conditions are negatively correlated with the employee turnover.
Impact of Nature of work on Job satisfaction and Employee Turnover
The other important determinant of turnover is the nature of work. The focus on it has been amplified
due to increase in the level of education in the country. Before this much attention was not given on it due to
low level of awareness, education. The researchers found in their studies that the work has effect the turnover
intention and satisfaction level of employees in the organization settings. Ting (1997) Locke (1995) found
the significant relationship of job satisfaction and turnover. Robbins et al. (2003, p. 77) refer to the work itself as “the extent to which the job provides the individual with stimulating tasks, opportunities for learning
and personal growth, and the chance to be responsible and accountable for results.” The work that related
to the aptitude of employees is most fascinated for them. (Robbins,1993). It was found during the study
of clerical employees in the banking sector that the turnover intention has negative correlated with nature
of work (Koh and Goh 1995). In the Light of above supplement we Hypothesis as under:
H7: The Nature of work is positively correlated with the job satisfaction.
H8: The Nature of work is negatively correlated with the employee turnover.
Impact of Job satisfaction on Employee Turnover
In the Literature, the turnover topic is studied to find out the relationship it with job satisfaction. Most
of the researchers found the negative association between job satisfaction and turnover. (e.g., Cotton &
Tuttle, 1986; Arnold & Feldman, 1982; Bluedorn, 1982; Mobley, 1982; Price, 1977, and many others),
The job satisfaction is the critical factor in delivering the quality products/services and s ultimately for
the success of the company (Silva 2006). The researchers found that job satisfaction is significant towards the
turnover and absenteeism. (Koh, and Boo, 2004; Lee and Liu, 2007). Hence the Literature ropes to devise
the following Hypothesis
H9: Job Satisfaction is negatively correlated with the employee turnover.
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Theoretical Frame Work
In the light of the aforesaid literature review we can develop the following theoretical framework:
Pay
Promotion
Employee Turnover
Working Conditions
Nature of the Work
Job Satisfaction
Fig. 1. Theoretical Frame Work
METHODOLOGY
The study examines the relationship of the factors such as Pay, Promotion, Job Safety and Security, Nature of Work on job satisfaction and employee turnover. The data was gathered from 200 Doctors, Nurses,
Administrative and Accounts & Finance staff from Basic Pay Scale 7-19 of Autonomous Medical Institution
of the Punjab. The statistical technique of convenient sampling was used to collect the data from the target
population. The questionnaires were send to the target population i.e. AMI’s of Punjab and received back
by hand or mail.
Instrument
The questionnaire was divided into two sections; the first section pertained to the questions of independent variables i.e. pay, promotion, job safety and security, working conditions, relationship with supervisor, nature of work mediating variable job satisfaction and dependent variable turnover.
The second section was about the demographic factors like age, designation, education, experience,
gender, job relevancy and nature of job. The alpha range was found .901 that is ample. To get the response
from the target population the Likert scale was used demonstrating a score of 1 for strongly disagree, 2 for
disagree, 3 for undecided, 4 for agree and 5 for strongly agree.
Data analysis procedure
Many scholars are the view that statistical packages are the most reliable instruments to get the precise
and inclusive results on the large scale. (Buglear, 2005). Due to reliability and accuracy most of the scholars in their research has used the statistical packages like SPSS. In the current study to find out the results
of data, the SPSS with 20 versions is used. (version 11 was used by Okpara, 2004).
126
Alamdar Hussain Khan, Muhammad Aleem
Impact of job satisfaction on employee turnover:
An empirical study of Autonomous Medical Institutions of Pakistan
RESULTS AND FINDINGS
Response rate
In the Autonomous Medical Institution’s of the Punjab 250 questionnaires were distributed and 200
were received back. The 80% response was received from the target sample.
Demographics frequency table
The information regarding the demographics are elaborated in the given below table.
Table 1
Description
Age
Gender
Qualification
Job Level
Organizational Tenure
Nature of Employment
18-24
25-31
32-38
39-45
46-52
Above 52
Male
Female
Matriculation
Intermediate
Graduation
Master
M.Phil / Phd
BPS 7-16
BPS 17-18
Above 18
1-5
6-10
11-15
16-20
Above 20
Contract
Permanent
Ad hock/other
Frequency
%age
9
66
47
33
31
14
138
62
11
33
52
92
12
94
92
14
67
50
28
17
38
39
137
24
4.5
33.0
23.5
16.5
15.5
7.0
69.0
31.0
5.5
16.5
26
46
6
47
46
7.0
33.5
25.0
14.0
8.5
19.0
19.5
68.5
12.0
Source: own calculation
The questionnaire consists of mixture of the respondents included in the demographic section. In the
sample most of the employee’s age range is 25-31 years. These employees have the less tenure in the service
as the minimum age to quality the Public Sector job in Pakistan is 18 years. The satisfaction level in these
employees is less as compared to the employees has the more years in the employment. The other brackets
of age are also included in the sample. In the Pakistan there is not much trend of female employment in the
labour market as in the sample there is majority of male. The major portion in the sample consist of Master Degree holders because the sample consist of doctors, paramedics, accounts and admin staff and most
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Vol. 7, No.1, 2014
of the them have the master qualification. In the Public Sector of Pakistan, the compensation paid to the
employees range in BPS 7-16 is less as compared the employees of BPS 17 to onward. The employees of BPS
7-16 cover the maximum portion of sample as the turnover ratio of these employees is higher as compared
to employees in BPS 17 and above. The intention to leave the job in employee’s has less tenure is higher as
compared to employee’s has more tenure in the Department. The major portion of the sample covers the
employees having the tenure of 1-5 years. The maximum employees are recruited on permanent basis in the
Health Department; hence the 68.5% in the sample are permanent employees.
The job satisfaction is the mediation factor under the reference study and the method of Judd and
Kenny (1981) and Baron & Kenny (1986) has been adopted. For the analysis of the data we have used three
equations. The exogenous variables in the model such as Pay, Promotion, Working Conditions and Nature
of Work were regressed on the mediating variable i.e. Job Satisfaction in the Equation No.01. Then the
regression of the exogenous variables on the endogenous variable employee turnover was performed in the
Equation No. 02. The exogenous variables Pay, Promotion, Working Conditions and Nature of Work and
mediating variable Job Satisfaction are also regressed on the endogenous variable Employee Turnover in the
Equation No. 03. The output of the three equations is elaborated in the Table-II.
Table 2
Regression equations of exogenous variables and mediation variable job satisfaction
and the endogenous variable employee turnover.
Eqn.
Dependent variable
1a
1b
1c
1d
2a
2b
2c
2d
3a
Job Satisfaction
Job Satisfaction
Job Satisfaction
Job Satisfaction
Employee Turnover
Employee Turnover
Employee Turnover
Employee Turnover
Employee Turnover
3b
Employee Turnover
3c
Employee Turnover
3d
Employee Turnover
Independent variable
Pay
Promotion
Working Conditions
Nature of work
Pay
Promotion
Working Conditions
Nature of Work
Pay
Job Satisfaction
Promotion
Job Satisfaction
Working Conditions
Job satisfaction
Nature of Work
Job Satisfaction
Beta
T
.250
.236
.288
.243
-.027
-.111
-.147
-.215
-.010
-.067
-.100
-.045
-.138
-.029
-.210
-.018
3.639
3.424
4.238
3.527
-.373
-1.571
-2.090
-3.092
-1.34
-.909
-1.377
-.625
-1.882
-.397
-2.931
-.252
R-Square
F
.063
.056
.083
.059
.001
.012
.022
.046
.005
13.243
11.726
17.962
12.443
.139
2.469
4.368
9.52
.483
.014
1.426
.022
2.254
0.046
4.790
Source: own calculation
To find out that the job satisfaction is the mediating variable and has its significance with the Pay, Promotion, Working conditions, Nature of the Work and the Employee Turnover in the Autonomous Institutions of the Health Department we have performed the regression analysis in the equation 1a, 2a and 3a.
To investigate the effect of exogenous variables on the mediation variable job satisfaction the regression
of equation No. 1a was used and found that the level of job satisfaction is affected by the Pay, Promotion,
Working Conditions, Nature of the Work. Moreover the results of the exogenous variables on the endogenous variable Employee Turnover were also found significant as predicted in the equation 2a. At the end
in the equation 3a the relationship of Employee Turnover with the mediating variable job satisfaction and
128
Alamdar Hussain Khan, Muhammad Aleem
Impact of job satisfaction on employee turnover:
An empirical study of Autonomous Medical Institutions of Pakistan
exogenous variables was also concluded and found that the job satisfaction is the mediating variable. As the
beta of pay is .250 in the equation 1a and decreased in the equation 2a with -.147 and 3a with -0.010. The
said equations results stated that the job satisfaction is the mediating variable in such case and the employee
with the low level of job satisfaction resulted into the increase in the rate of employee turnover.
We have regressed the Employee Turnover on the independent variables and the mediating variable job
satisfaction. The results indicate that the Beta in the equation 2(a) was -.147 and in the equation 1(a) was
.250. It predicts that the job satisfaction is the mediating variable in this model.
CONCLUSION AND RECOMMENDATIONS
The said study pertained to the employees of the Autonomous Medical Institutions of Health Department in the Province of Punjab in order to find out the factor affecting the job satisfaction level and the
impact of job satisfaction on the employee turnover. The findings suggested that the variables like Pay,
Promotion, Working Conditions and Nature of Work are the prominent for the job satisfaction level of the
employees. The management of the Autonomous Medical Institutions may take the appropriate steps to
enhance the job satisfaction level of employees. Furthermore it is suggested management should take into
the account of the factors such as Pay, Promotion, Working Conditions and Nature of Work in order to
minimize the turnover level of the employees in the Autonomous Medical Institutions.
Limitation and future directions of the study
We have conducted the research by taking the variables Pay, Promotion, Working Conditions and
Nature of Work in this study. In order to more general results, the other factors may also be included
in the future research. The sample size was also limited that can also be increased to find out other determinants. A comparative study of public and private hospitals may also be conducted to find out the differences
in both sectors.
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International Journal of Business and Social Science
Vol. 4 No. 7; July 2013
The Relationship between Employees’ Income Level and Employee Job Satisfaction:
An Empirical Study
Prof. Dr. Ismail Bakan
Faculty of Economics and Administrative Sciences
Kahramanmaras Sutcu Imam University
Kahramanmaras
Turkey
Assist. Prof. Dr. Tuba Buyukbese
Faculty of Economics, Administrative and Social Sciences
Hasan Kalyoncu University
Gaziantep
Turkey
Abstract
The aim of this paper is to investigate the relationship between employees’ income level and employees’ job
satisfaction. For this purpose, an empirical study was conducted in a British company. The results of the
empirical study show that there is a significant relationship between employees’ income level and employees’ job
satisfaction. Although the study found the possibility that job satisfaction and employees’ income levels are
related to each other, it did not analyze the direction of the causality.
Key Words: Income level, job satisfaction.
1. Introduction
Improving employee satisfaction has become one of the main corporate objectives in recent years (Garcia-Bernal
et al., 2005). It is realized that organizations cannot achieve competitive levels of quality, either at a product level
or a customer service level, if their employees do not feel satisfied or do not identify with the company (Stewart,
1996; Garcia-Bernal et al., 2005).
The topic of job satisfaction is an crucial one because of its relevance to the physical and mental well-being of
employees, and its implications for job related behaviours such as productivity, absenteeism or turnover. Work is
an important aspect of people’s lives and most employees spend a large part of their working life at work. An
understanding of the factors affecting job satisfaction is relevant to improving the well being of a huge number of
people (Oshagbemi, 1999). Improving job satisfaction has become an important subject in both the professional
world and the academic world (Garcia-Bernal et al., 2005). Therefore, job satisfaction is perhaps one of the single
most frequently researched variable in the field of organizational behaviour or organizational psychology.
Job satisfaction is a main variable in both research and theory of organizational phenomenon ranging from job
design to supervision. Really thousands of job satisfaction studies can be found in the literature of the
organizational behaviour and related fields. Locke (1976) estimated that, as of 1976, nearly 3,350 articles and
dissertations had been written on the topic. According to Oshagbemi (1996), this estimate would most probably
be doubled if a count of relevant articles and dissertations were made today. These researches are based on the
implicit assumptions that job satisfaction is a potential determinant of absenteeism, turnover, productivity, in-role
job performance and extra-role behaviour. For instance, numerous studies have established job satisfaction as a
significant predictor of employee turnover (Griffeth et al., 2000; Hom et al., 1992). Poon (2004) hypothesized that
job satisfaction will be negatively related to turnover intention and by conducting an empirical study he found that
reduced job satisfaction led to greater intentions to quit their jobs. Some researchers have reported a negative
relationship between job satisfaction and absenteeism (Porters and Steers, 1973; Scott and Taylor, 1985). In his
study Oshagbemi (2000) analyzed the assumption that the less satisfied workers tend to resign while the more
satisfied ones tend to remain in a job.
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He found that the overall job satisfaction of university teachers is significantly correlated with length of service in
present university but not with length of service in higher education. A number of studies concentrated on the
relationship between organizational commitment and job satisfaction. While some of them (Williams and Hazer,
1986; Liou, 1995; Wong et al., 1995; Fletcher and Williams, 1996; Bhuian et al., 1996) found a relationship
between job satisfaction and organizational commitment, others (such as Curry et al., 1986) did not find any
association between the two variables.
Researchers have shown that various demographic characteristics of employees (such as age, gender, tenure,
income) have relevance to their level of job satisfaction (Finlay et al., 1995; Clark et al, 1996; Howard and Frink,
1996; Miles et al., 1996; Ganzach, 1998; Robie et al, 1998; Gaertner, 1999; Groot and Maasen van den Brink,
1999; Sousa-Poza and Sousa-Poza, 2000; Eskildsen, et al., 2003). These studies report different and sometimes
contradictory findings with respect to the effect that employee characteristics such as gender, age and educational
level have on work motivation and job satisfaction. Although many studies have focused on job satisfaction, there
are still many unanswered questions about its nature (Lam, et al., 2001). Therefore, the relationship between
employees’ demographic characteristics and their job satisfaction occurs as an important subject to be studied. In
this paper the relationship between income and employee satisfaction is investigated.
Job satisfaction is defined as an “employee’s state of emotion and affective responses to specific aspects of the
job (Williams and Hazer, 1986). Locke (1976) defined the job satisfaction as “a pleasurable or positive emotional
state resulting from the appraisal of one’s job or fob experiences” or as “a function of the perceived relationship
between what one wants from one’s job and what one perceives it as offering” (Locke, 1969) . According to Lam
and his friends (2001) job satisfaction is the discrepancy between what an employee values and what the situation
provides. Job satisfaction is conceptualized as a general attitude toward an object, the job (Oshagbemi, 1999).
Linz (2003) stated that “job satisfaction generally implies a positive evaluation of work and a positive effect
deriving from it”. Price and Muller (1986) define job satisfaction by the degree to which individuals like their job.
Churchill et al., (1974) define job satisfaction by taking into account both all the characteristics of the job itself
and of the work environment in which employees may find rewards, fulfillment and satisfaction, or conversely,
sentiments of frustration and/or dissatisfaction (Garcia-Bernal et al., 2005).
In the literature, some empirical studies investigated the relationship between income and job satisfaction. Ward
and Sloane (2000) concluded that males, who consider themselves underpaid, to be less satisfied in the Scottish
academic labour market. By using the data from 5,000 British workers Clark and Oswald (1996) tested the
hypothesis that satisfaction depends on income relative to a comparison or reference level. They used a
comparison income variable measured as the difference between actual income and income predicted using an
earnings equation. They found that the higher an individual’s income relative to the predicted income, the higher
the job satisfaction. In their study Mekkelholt and Hartog (1989) found that quasi rents or temporary wage
differentials have a positive but small effect on job satisfaction (Groot et al., 1999).
2. The Evaluation of the Empirical Study
2.1. The Aim, Design, Sample and the Analytic Procedure of the Survey
Aim of the Study: The aim of the study is to investigate the relationship between employees’ income level and
employee job satisfaction. This is a quantitative study where the data were gathered by using the questionnaire
method. The unit of analysis is the individuals who responded to the questionnaire, and the study is cross
sectional.
Sample: The population for the study consisted of employees in a British consultant company. 1,000
questionnaires were mailed and a total of 934 returns were received – a response rate of 93.4 percent. Of these
returns, 921 were usable for further analysis. Thirteen had to be discarded because too many of the questions were
left unresponded.
Measures of the Study Variables: Employees’ job satisfaction: In order to measure the essence of employee
satisfaction, five specific aspects of satisfaction were measured in the study: satisfaction with compensation,
social satisfaction, satisfaction with the work itself, with promotion, and with supervisor. For each specific aspects
of satisfaction, the multiple item scale was used. The items were taken from the Long’s (1978) and Graen’s
(1966) studies.
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International Journal of Business and Social Science
Vol. 4 No. 7; July 2013
In the questionnaire respondents were presented with a series of statements and asked to mention their personal
opinions about each one. On the research questionnaire, the respondents were given 7-point Likert scale, ranging
from 1 (“strongly disagree”) to 7 (“strongly agree”) to record their answers. For comparison of satisfaction level
of employees with high performance and employees with low performance, a scale for each aspects of satisfaction
was constructed by averaging the responses across relevant items by using COMPUTE MEAN option of SPSS for
Windows programme.
Analytic Procedure (Statistical Analysis): Prior to statistical analysis, all questionnaire data were computercoded for use with the Statistical Package for the Social Sciences (SPSS) for Windows. Frequency analysis was
used to indicate the respondents’ opinions for each questionnaire items. Then, as the main aim of the study is to
find out the relationship between employees’ income level and employee job satisfaction correlation analysis and
the t statistic were used. With t statistic the study compares the levels of satisfaction as perceived by employees’
with high income and employees’ with low income level.
Demographic Characteristics of Survey Respondents
The administration of the questionnaire resulted in 921 usable returns, an overall response rate of 92.1%. Of all
respondents, when asked to specify their job status, the following was reported: senior manager (above team
managers) (3.6%), team manager (6.2%), senior/principal consultant (22.4%), consultant (29.2%), clerical or
secretarial (11.9%), technical (e.g., scientific officer) (19.4%), and “other” (7.2%). When asked to specify their
personal characteristics, 68% were male and 32% were female. Regarding their marital status, 61.8% were
married, 29.5% were singe, and remaining 8.7% were others (widowed, divorced or separated). Regarding their
age, 25.1% were less than 31 years old, 48.6% were the ages of between 31 and 46, and the remaining 26.3%
were over 46 years old. When asked to specify their highest education level, the following was reported:
completed secondary school (9.1%), some university or technical training beyond secondary school (29.15),
bachelor’s degree (44.3%), master’s degree (10.2%), and doctoral degree (7.3%). 84.6% of respondents had been
with the company for two years or longer, while remaining 15.4% had been with the company for less than two
years.
2.2. The Relationship between Employees’ Income Level and Employees’ Satisfaction
As mentioned earlier in the paper, five specific aspects of satisfaction were measured in the study: satisfaction
with compensation, social satisfaction, satisfaction with the work itself, with promotion, and with supervisor. In
here, the relationship between employees’ income level and employees’ satisfaction is analysed by using the
study data.
Income level and satisfaction with compensation
The respondents’ satisfaction with their compensation was measured by using 3 questionnaire items with sevenpoint Likert scale, from 1 “strongly disagree” to 7 “strongly agree” (see Table 1).
Table 1: Satisfaction with Compensation
1*
%
N
8,6
78
21,2
195
2
%
N
15,5
140
21,1
194
3
%
N
13,0
118
16,6
152
4
%
N
23,1
209
9,2
84
5
%
N
18,7
169
13,0
119
6
%
N
19,2
174
16,2
149
7
%
N
2,0
18
2,7
25
Fringe benefits in the
company are good
Considering my skills and
the efforts I put into my
work I am satisfied with my
pay.
Compared to what others
15,2 16,3 15,7 15,7 13,6 20,4 3,1
earn in the company, may
139 149 144 144 125 187 28
pair is fair.
* 1= Strongly disagree
5=Slightly agree
20
2=Disagree
6=Agree
3=Slightly disagree
7=Strongly agree
Total Mean Std.
Dev.
3,93
1,63
100
906
3,31 1,86
100
918
100
916
3,70
1,82
4=Neither agree nor disagree
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To find out the employees satisfaction with fringe benefits, respondents were requested to rate the following
comment “Fringe benefits in the company are good”. There were 906 applicable responses for this analysis. 24,
1% of them had strongly disagreed (8,6%) or disagreed (15,5%) with the statement, 13% of them had slightly
disagreed, on the other hand 21,2% had strongly agreed (2%) or agreed (19,2%) and 18,7% had slightly agreed
with the statement. The remaining 23,1% of them had chosen “neither agree nor disagree” option. To the
statement of “Considering my skills and the efforts I put into my work I am satisfied with my pay” 918
respondents were given their opinion. Slightly more than half of the respondents (58,9%) had disagreed with the
comment, while 31,9% of the respondents had agreed with it. The remaining 9,2% of them had chosen the
“neither agree nor disagree” option.
In order to find out their opinion on the fairness of they pay, the respondents were given a statement of “compared
to what others earn in the company, my pay is fair”, and 916 responses were received. 31,4% of them had
strongly disagreed (15,2%) or disagreed (16,3%), and 15,7% had slightly disagreed with the statement, while 34%
had agreed or slightly agreed and 3,1% had strongly agreed with the statement. The remaining 15,7% of them had
chosen the “neither agree nor disagree” option.
In sum, as Table 1 shows, for none of the three items measuring satisfaction with compensation, more than half of
the respondents had chosen the “agree” options (slightly agree, agree, strongly agree). It means, in general, the
respondents are not satisfied with their compensation in this company. This result is proved by the mean values of
the three items (see Table 1). The mean values for three items measuring satisfaction with compensation are
below the average (4 point) which forms the “disagree” area of a 7-point Likert scale, ranging from 1 “strongly
disagree” to 7 “strongly agree”.
Table 2: The Comparison of Employees Regarding their Satisfaction with Compensation
Satisfaction with
compensation
* p
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