Do compensation and benefits impact job satisfaction and employee motivation within an organization?

Does compensation affect job satisfaction?

Compensation is the top contributor to job satisfaction, according to a report from the Society for Human Resource Management. In fact, 96 percent of surveyed employees say that compensation is important or very important to their overall happiness on the job.

How compensation and benefits can impact employee morale and performance?

Properly compensating employees shows you value them as workers and as human beings. When people feel valued, they feel better about coming in to work. Overall company morale increases and people are motivated to come to work and do a good job.

What is the relationship between compensation and job satisfaction?

Compensation is the strong predictor of job satisfaction with a standardized beta value of 0.261. Benefits was found to be non-significant at 99% (p<0.01). Research question 1: Compensation has a positive and significant effect on job satisfaction.

How does compensation affect employee motivation?

High compensation provides employees with a sense of satisfaction from their job and incentivizes them to perform better (especially when compensation is directly related to job performance). On the contrary, studies have also shown that low compensation hinders employee motivation and performance.

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Why is compensation and benefits important to an organization?

Compensation and benefits are important aspects of an employee’s satisfaction at a workplace, as they directly impact an employee’s performance and motivation to work.

How does benefit affect employees performance?

When the right mix of benefits is offered, it’s easier to attract and retain quality workers. Employees feel better and are more productive. Over the past decade, employees have become more active in choosing health benefits and monitoring their plans.

What are the benefits of job satisfaction?

Benefits of Job Satisfaction

  • Lowers voluntary turnover.
  • Reduces Employee Absenteeism.
  • Reduces long-term HR costs.
  • Contributes positive results towards Employee Referral Programs.
  • Boosts Employee Productivity.
  • Increases Employee Retention.

What is the impact of compensation and benefits to job satisfaction?

Currently, compensation and benefit plays a significant role for the organization that aim to accomplish their objectives and goals. The poor compensation and benefits will lead to low performance and that will lead to low satisfaction level that will increase absenteeism in employee and the outcome will decrease [2].

What is the impact of compensation and benefits on organizational effectiveness?


To achieve effective work performance calls for job satisfaction among the workers. Compensation plays a significant role in influencing job satisfaction. It stimulates employees to work harder, thus increasing productivity and enhancing job performance.

Is there a correlation between compensation motivation and job performance?

So it can be concluded that the higher the compensation given will increase employee work motivation. Compensation has a significant effect on job satisfaction; it is proved that the value of t-value is greater than the critical t value of 1.96.

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