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

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  • Petri Böckerman
  • Pekka Ilmakunnas

Abstract

The authors examine the role of employee job satisfaction in Finnish manufacturing plants over the period 1996–2001 to determine the extent to which it affects establishment-level productivity. Using matched data on job satisfaction from the European Community Household Panel (ECHP) and information on establishment productivity from longitudinal register data linked to the ECHP, they estimate that the effect of an increase in the establishment's average level of employee job satisfaction on productivity is positive, but its magnitude varies depending on the specification of the model. The authors use an instrumental variables point estimate and find that an increase in the measure of job satisfaction by one within-plant standard deviation increases value-added per hours worked in manufacturing by 6.6%.

Suggested Citation

  • Petri Böckerman & Pekka Ilmakunnas, 2012. "The Job Satisfaction-Productivity Nexus: A Study Using Matched Survey and Register Data," ILR Review, Cornell University, ILR School, vol. 65(2), pages 244-262, April.
  • Handle: RePEc:sae:ilrrev:v:65:y:2012:i:2:p:244-262
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    References listed on IDEAS

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    Cited by:

    1. Eugenio Proto, 2016. "Are happy workers more productive?," IZA World of Labor, Institute for the Study of Labor (IZA), pages 315-315, November.
    2. repec:spr:soinre:v:132:y:2017:i:3:d:10.1007_s11205-016-1338-x is not listed on IDEAS
    3. Semih Tumen & Tugba Zeydanli, 2015. "Is Happiness Contagious? Separating Spillover Externalities from the Group-Level Social Context," Journal of Happiness Studies, Springer, vol. 16(3), pages 719-744, June.
    4. Ręklewski Marek & Ryczkowski Maciej, 2016. "The Polish Regional Labour Market Welfare Indicator and Its Links to Other Well-being Measures," Comparative Economic Research, Sciendo, vol. 19(3), pages 113-132, September.
    5. repec:eee:labeco:v:46:y:2017:i:c:p:150-165 is not listed on IDEAS
    6. Menon, Seetha & Salvatori, Andrea & Zwysen, Wouter, 2018. "The Effect of Computer Use on Job Quality: Evidence from Europe," IZA Discussion Papers 11298, Institute for the Study of Labor (IZA).
    7. Jan-Emmanuel De Neve & George Ward, 2017. "Happiness at Work," CEP Discussion Papers dp1474, Centre for Economic Performance, LSE.
    8. Böckerman, Petri & Bryson, Alex & Ilmakunnas, Pekka, 2012. "Does high involvement management improve worker wellbeing?," Journal of Economic Behavior & Organization, Elsevier, vol. 84(2), pages 660-680.
    9. Bubonya, Melisa & Cobb-Clark, Deborah A. & Wooden, Mark, 2017. "Mental health and productivity at work: Does what you do matter?," Labour Economics, Elsevier, vol. 46(C), pages 150-165.
    10. Broszeit, Sandra & Fritsch, Ursula & Görg, Holger & Laible, Marie-Christine, 2016. "Management Practices and Productivity in Germany," IZA Discussion Papers 10370, Institute for the Study of Labor (IZA).
    11. Andrew J. Oswald & Eugenio Proto & Daniel Sgroi, 2015. "Happiness and Productivity," Journal of Labor Economics, University of Chicago Press, vol. 33(4), pages 789-822.
    12. MENON, Seetha; SALVATORI, Andrea; ZWYSEN, Wouter, 2018. "The effect of computer use on job quality: evidence from Europe," Economics Working Papers MWP 2018/02, European University Institute.
    13. Brehm, Margaret & Imberman, Scott A. & Lovenheim, Michael F., 2017. "Achievement effects of individual performance incentives in a teacher merit pay tournament," Labour Economics, Elsevier, vol. 44(C), pages 133-150.
    14. De Neve, Jan-Emmanuel & Ward, George, 2017. "Happiness at work," LSE Research Online Documents on Economics 83604, London School of Economics and Political Science, LSE Library.
    15. Cristina Borra & Francisco Gómez-García, 2016. "Wellbeing at Work and the Great Recession: The Effect of Others’ Unemployment," Journal of Happiness Studies, Springer, vol. 17(5), pages 1939-1962, October.
    16. De Neve, Jan-Emmanuel & Diener, Ed & Tay, Louis & Xuereb, Cody, 2013. "The objective benefits of subjective well-being," LSE Research Online Documents on Economics 51669, London School of Economics and Political Science, LSE Library.
    17. T. Kifle & P. Kler & S. Shankar, 2017. "Underemployment and its impact on job satisfaction: An Australian study on part-time employment," Discussion Papers in Economics economics:201712, Griffith University, Department of Accounting, Finance and Economics.
    18. Jan-Emmanuel De Neve & Ed Diener & Louis Tay & Cody Xuereb, 2013. "The Objective Benefits of Subjective Well-Being," CEP Discussion Papers dp1236, Centre for Economic Performance, LSE.
    19. Bossler, Mario & Broszeit, Sandra, 2016. "Do minimum wages increase job satisfaction? : micro data evidence from the new German minimum wage," IAB Discussion Paper 201615, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    20. Filiz Gülal & Adam Ayaita, 2018. "The Impact of Minimum Wages on Well-Being: Evidence from a Quasi-Experiment in Germany," SOEPpapers on Multidisciplinary Panel Data Research 969, DIW Berlin, The German Socio-Economic Panel (SOEP).
    21. Broszeit, Sandra & Fritsch, Ursula & Görg, Holger & Laible, Marie-Christine, 2016. "Management practices and productivity in Germany (Managementpraktiken und Produktivität in Deutschland)," IAB Discussion Paper 201632, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    22. Broszeit, Sandra & Fritsch, Ursula & Görg, Holger & Laible, Marie-Christine, 2016. "Management practices and productivity in Germany," Kiel Working Papers 2050, Kiel Institute for the World Economy (IfW).
    23. Böckerman, Petri & Ilmakunnas, Pekka, 2017. "Do Good Working Conditions Make You Work Longer? Evidence on Retirement Decisions Using Linked Survey and Register Data," IZA Discussion Papers 10964, Institute for the Study of Labor (IZA).
    24. Francis Green & Alan Felstead & Duncan Gallie & Hande Inanc, 2016. "Job-Related Well-Being Through the Great Recession," Journal of Happiness Studies, Springer, vol. 17(1), pages 389-411, February.

    More about this item

    JEL classification:

    • J28 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Safety; Job Satisfaction; Related Public Policy
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity

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