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Association between Compensation and Job Satisfaction: A Meta-analysis
Association between Compensation and Job Satisfaction: A Meta-analysis
Parallel abstracts
In recent years, with the economic growth, it has become easier for people to change their job, so the organizations have to face the challenge of how to reduce the turnover rate. Even though the basic salary is no longer the only thing to make the employee feel satisfied or to work hard for the company, Ida and Ali (2010) claimed that compensation has a significant effect on commitment with the satisfaction as a mediator, which means satisfied employees work harder and are more committed. Thus, compensation packages still play an important role in employee retention. Many companies have started to build a happy company, providing different work-life balance benefits such as flex-hours and vacations, which are all included in the compensation. Thus, the goal of this study is to summarize the correlation between compensation, which include pay satisfaction and work-life balance benefit, and job satisfaction through a meta analysis approach. Data was collected from 2010 to 2020. For research on pay satisfaction and job satisfaction, 30 articles were included and for research on work-life balance and job satisfaction, 40 articles were included. Forest plots, subgroup analysis and publication bias analysis were conducted to report the results. The analysis revealed that both pay satisfaction and work-life balance have a positive effect on job satisfaction. Moreover, economic difference was found to significantly moderate the relationship between pay satisfaction and job satisfaction, as well as the relationship between work-life balance and job satisfaction. The results can motivate the organizations in designing employee compensation as a part of the strategy in pursuing their goal of improving the satisfaction of employees.