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HRM and Small-Firm Employee Motivation: Before and after the Recession

Listed author(s):
  • Bryson, Alex

    ()

    (University College London)

  • White, Michael

    ()

    (Policy Studies Institute)

A long-running debate in the small firms' literature questions the value of formal 'human resource management' (HRM) practices which have been linked to high performance in larger firms. We contribute to this literature by exploiting linked employer-employee surveys for 2004 and 2011. Using employees' intrinsic job satisfaction and organizational commitment as measures of motivation we find the returns to small firm investments in HRM are u-shaped. Small firms benefit from intrinsically motivating work situations in the absence of HRM practices, find this advantage disturbed when formal HRM practices are initially introduced, but can restore positive motivation when they invest intensively in HRM practices in a way that characterizes 'high performance work systems' (HWPS) and 'strategic human resource management' (SHRM). Although the HPWS effect on employee motivation is modified somewhat by the recessionary transition, it remains rather robust and continues to have positive promise for small firms.

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File URL: http://ftp.iza.org/dp10737.pdf
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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 10737.

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Length: 36 pages
Date of creation: Apr 2017
Handle: RePEc:iza:izadps:dp10737
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  1. Frölich, Markus & Huber, Martin & Wiesenfarth, Manuel, 2015. "The Finite Sample Performance of Semi- and Nonparametric Estimators for Treatment Effects and Policy Evaluation," IZA Discussion Papers 8756, Institute for the Study of Labor (IZA).
  2. Aysit Tansel & Saziye Gazîoglu, 2014. "Management-employee relations, firm size and job satisfaction," International Journal of Manpower, Emerald Group Publishing, vol. 35(8), pages 1260-1275, October.
  3. Alexander Hijzen & Richard Upward & Peter W. Wright, 2010. "Job Creation, Job Destruction and the Role of Small Firms: Firm-Level Evidence for the UK," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 72(5), pages 621-647, October.
  4. Hainmueller, Jens & Xu, Yiqing, 2013. "ebalance: A Stata Package for Entropy Balancing," Journal of Statistical Software, Foundation for Open Access Statistics, vol. 54(i07).
  5. Chris Moule, 1998. "Regulation of Work in Small Firms: A View from the Inside," Work, Employment & Society, British Sociological Association, vol. 12(4), pages 635-653, December.
  6. Ichniowski, Casey & Shaw, Kathryn & Prennushi, Giovanna, 1997. "The Effects of Human Resource Management Practices on Productivity: A Study of Steel Finishing Lines," American Economic Review, American Economic Association, vol. 87(3), pages 291-313, June.
  7. Harvie Ramsay & Dora Scholarios & Bill Harley, 2000. "Employees and High-Performance Work Systems: Testing inside the Black Box," British Journal of Industrial Relations, London School of Economics, vol. 38(4), pages 501-531, December.
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