The Job Satisfaction-Productivity Nexus: A Study Using Matched Survey and Register Data

25 Pages Posted: 18 Jun 2010

See all articles by Petri Bockerman

Petri Bockerman

Labour Institute for Economic Research; University of Turku - Turku School of Economics

Pekka Ilmakunnas

Aalto University School of Business

Date Written: June 17, 2010

Abstract

This paper examines the role of job satisfaction in the determination of establishment-level productivity. The matched data contain both information on job satisfaction from the ECHP (European Community Household Panel) and information on establishment productivity from longitudinal register data that can be linked to the ECHP. The estimates for the effect of a one point increase in the establishment average level of employee job satisfaction, on a scale 1-6, on productivity vary depending on the specification of the model. The preferred estimate, based on the IV estimation that uses satisfaction with housing conditions as an instrument for job satisfaction, shows that the effect on value added per hours worked is 20% in the manufacturing sector. The economic size of this effect is modest, because the observations are bunched towards the higher end of the satisfaction scale making it very difficult to increase the average level of job satisfaction in the establishment by one point.

Keywords: job satisfaction, employee well-being, productivity, performance

JEL Classification: D24, J28

Suggested Citation

Bockerman, Petri and Ilmakunnas, Pekka, The Job Satisfaction-Productivity Nexus: A Study Using Matched Survey and Register Data (June 17, 2010). Available at SSRN: https://ssrn.com/abstract=1626126 or http://dx.doi.org/10.2139/ssrn.1626126

Petri Bockerman (Contact Author)

Labour Institute for Economic Research ( email )

FIN-00530 Helsinki
Finland
+358 9 2535 7332 (Phone)
+358 9 2535 7332 (Fax)

HOME PAGE: http://www.petribockerman.fi/

University of Turku - Turku School of Economics ( email )

Rehtorinpellonkatu 3
TURKU, FI-20500
Finland

Pekka Ilmakunnas

Aalto University School of Business ( email )

PO Box 21240
FI-00076 Aalto, Helsinki
Finland
+358 40 5815390 (Phone)

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
225
Abstract Views
1,182
rank
165,021
PlumX Metrics