The influence of intrinsic and extrinsic job satisfaction factors and affective commitment on the intention to quit for occupations characterized by high voluntary attrition
Table of Contents List of Tables ix List of Figures x CHAPTER I: INTRODUCTION 11
Significance 16 Purpose of the Research 17 Research Questions 17 Hypotheses 18
The Sub-Problems 18 The First Sub-Problem 18 The Second Sub-Problem 18 The Third Sub-Problem 18 The Fourth Sub-Problem 19
The Delimitations 19
The Limitations 19
Assumptions 19 Variables 20
Intrinsic Job Satisfaction Factors 20
Extrinsic Job Satisfaction Factors 20
Affective Commitment 20
Intention to Quit 20
Commercial Line of Business 21
Industrial Line of Business 21
Residential Line of Business 21
CHAPTER II: LITERATURE REVIEW 22
The Research Model 23 Past is Prologue 24 Content and Process Theories 27 Social Identity Theory 28 Key Theory 28 Extrinsic Factors 30 Supervision 30 Work Conditions 30 Co-Workers 30 Pay 31 Policies 31
Job Security 31 Status 31 Personal Life 32 Intrinsic Factors 32 Achievement 32 Recognition 33 Responsibility 33 Advancement 33 Growth 33 The Work 34 Criticism of the Theory 34 Defense of the Theory 35 Application of the Theory to the Solid Waste Management Industry 37 Job Satisfaction 38
Affective Commitment 42
Intention to Quit 43 Mixed Evidence of Causal Relationship 44 The Impact of Unionization 48
CHAPTER III: METHODOLOGY 50
Research Design 50 Population and Sample 51 Survey Instruments 51 Job Satisfaction 52 Affective Commitment 53 Intention to Quit 53 Demographics 54 Sampling Method 54 Research Questions 55 Hypotheses 55
Statistical Technique 56 CHAPTER IV: ANALYSIS AND PRESENTATION OF FINDINGS 58 Data Collection 58
Descriptive Statistics 59 Demographics 59 Variables 61 Reliability Estimates 62 Pearson Product-Moment Correlation 63 Individual Questions 63 Grouped Questions 66
Independent-Samples t-Tests 67 Hypotheses Analysis 69 Summary 70 CHAPTER V: SUMMARY AND CONCLUSION 72 Support for Hypotheses 72 The Influence of Intrinsic and Extrinsic Factors 73 Job Satisfaction and Affective Commitment 74 Predicting Turnover 75 Practical Implications 76 Limitations 79 Recommendations for Future Research 80
References 83 Letter to Participants 102 Draft Instruments 103 General Information Questionnaire 103 Minnesota Satisfaction Questionnaire 104
Affective Commitment Questionnaire 105 Intention to Quit Questionnaire 106
List of Tables Table 1. Descriptive Statistics and Frequencies for Demographics in the Overall Sample 60 Table 2. Descriptive Statistics for Variables 62 Table 3. Reliability Estimates of Scales 63 Table 4. Correlations of Job Satisfaction Factors and Affective Commitment with the Intent to Quit 64 Table 5. Grouped Correlation Matrix for All Variables 66 Table 6. Comparison of Grouped Variables between Publically Listed, Privately Held, and Unionized Operations 67 Table 7. Comparison of Grouped Variables between Commercial, Industrial, and Residential Positions 68
List of Figures Figure 1. The Research Model based on Herzberg’s Two-Factor Theory 23 Figure 2. Conventional Continuum of Job Satisfaction 29 Figure 3. Dual-Factor Continua of Job Satisfaction 29 Figure 4. Model 1 showing the equal influence of job satisfaction and affective commitment on the intent to quit 45 Figure 5. Model 2 showing job satisfaction mediating in favor of affective commitment which has a positive influence on the intent to quit 45 Figure 6. Model 3 showing affective commitment mediating in favor of job satisfaction which has a positive influence on the intent to quit 46
The purpose of this research was to determine the antecedents to the intention to quit in an occupation characterized by a high degree of voluntary attrition. This chapter provides insight on the extent of the problem and the adverse affects of such turnover by a category of employee that is critical to environmental compliance nationwide. The significance of the problem is discussed along with the research questions and hypotheses. In addition, the chapter provides definitions of key terms, discusses variables, limitations, and assumptions that underlie the study. Background This study concerns the application of Herzberg’s (Herzberg, Mausner & Snyderman, 1959; Herzberg, 1966) Two-Factor Theory to determine the effect of intrinsic and extrinsic job satisfaction factors and affective commitment on the intention to quit among drivers in the solid waste management industry. As discussed in detail below, the industry suffers from extraordinary turnover rates and operational effectiveness is adversely affected as a result. Participants were taken from an industry leading publicly listed company, a premier privately held organization, and a unionized operation which represent all three principle lines of business. This study is the most comprehensive of its kind to address a qualitative organizational behavior issue in the solid waste management industry. The solid waste management industry represents a common thread of vital services that is woven into every community in America. The Environmental Research and Education Foundation commissioned a comprehensive study in 2001 that found that the industry accounted for annual revenues of $43.3 billion and employed about 367,800
people (Beck, 2001). Since that report, annual revenues have increased to $55.7 billion (Waste Business Journal, 2009). Indeed, the industry’s payroll alone is approximately $10 billion. From an economic impact standpoint, the study found that the waste management industry contributed over $96 billion to the United State’s economy, 948,000 jobs, and slightly more than one percent of the nation’s Gross Domestic Product (p. 3). Clearly, it is an industry that deserves attention. To be sure, it is not a pretty industry. The work is distributed among publicly traded and private companies as well as local municipalities. Drivers constitute the lion’s share of the workforce from an estimated 27,000 organizations (Beck, 2001). They are also the most visible industry representatives and are often looked down upon by the general public or incorrectly stereotyped as those who got the jobs promised by third grade teachers to students who did not study hard enough. Perhaps this accounts for the researcher’s finding just three prior studies that address the qualitative interests of this industry’s employees and none in the last 10 years. On balance, there is no shortage of research on employee turnover and workforce retention strategies, generally (Grensing-Pophal, 2000). It is just that none of it touches upon the huge solid waste management industry which is overly burdened by the problem. Nor does the study of the influence of job satisfaction factors and affective commitment pierce the veil of solid waste management drivers. This study helps to fill this gap in organizational behavior research. With respect to employee intentions to quit, nearly every organization has long shared an interest in heading off turnover and improving upon their respective employee
retention statistics (Griffeth & Hom, 2001). Nevertheless, the challenge has not been met in the solid waste management industry. Turnover rates have been on the rise for years (Griffeth & Hom, 2001). The effect can be especially harmful to productivity and safety outcomes (Shaw, Dineen, Fang & Vellella, 2009). The solid waste management industry’s second largest employer claims that its turnover rate runs between 28% and 40% annually and the industry average is in the high 30s (Marquez, 2007). Further, a recent general study claims that over 60% of employees will be actively engaged in a job search within the next three months (Manufacturing News, 2007). Most of that activity will occur during working hours. Of greatest concern may be the fact that two thirds of those seeking alternative employment are tenured and their departure would significantly drain the organization’s talent and knowledge base. Another study estimated that the number of job seekers would be more like 75% (Cohen, 2005). Further, those who look for a change in employment appear to be having success since national turnover rates currently average 19.3% overall (Institute of Management and Administration, 2005). The estimated turnover rate jumps to about 23.2% among truck drivers with some organizations reporting rates as high as 105.5% (Morrow, Suzuki, Crum, Ruben, & Pautch, 2005). Morrow et al. (2005) also call attention to the general shortage of qualified drivers in the first place and inherent recruitment competition. There are some who contend that high turnover rates are simply the by-product of a strong economy and low unemployment rates (Gurchiek, 2005). Others, like human resource professionals, assert that pay and benefits are the leading cause of turnover
(Manufacturing News, 2007). However, in the same study it was concluded that employers are, for the most part, unaware of the underlying reasons for employee dissatisfaction beyond compensation (p. 2). Thus, further research on the influence of job satisfaction factors and affective commitment on intentions to quit is warranted to shift away from misguided beliefs and identify opportunities for organizational performance improvements. The implications of employee turnover on organizational performance are far reaching. The hard and soft costs alone can easily range from 50% of one’s base salary to as much as 200% of the leaver’s wages (Cascio, 2000; Manufacturing News, 2007). In the solid waste management industry, for example, every time a driver leaves, so does the company’s substantial investment in his safety training (Beck, 2001). Maintenance costs increase when expensive collection equipment is strained by developing operators. Customer service is compromised by missed stops during orientation periods. Fuel costs rise with expanded route times. Further, morale declines when a daily shortage of experienced employees leads to fatigue and weakened communications among those remaining (Morrow et al., 2005). Obviously, if this goes on long enough, the problem will be exacerbated by more turnover and competitive advantages will soon slip away (Baylor, 2007). Profitability will also suffer. This is not to say that all employee turnovers are bad. In fact, some may be desirable. The functional loss of marginal performers or overpaid talent could actually benefit an organization (Griffeth & Hom, 2001). Furthermore, reducing turnover to zero is unrealistic (Hansen, 2005). The focus of this research was aimed at minimizing
dysfunctional or unwanted turnover since it has the greatest negative impact on organizations (Griffeth & Hom, 2001). This study posits that job satisfaction and affective commitment are antecedents to voluntary turnover. Unfortunately, corroborating reports on declining morale and job satisfaction in America illustrate the underlying rationale for managements’ ongoing concern about employee retention (Watson Wyatt Worldwide, 2009; Dickler, 2009; The Conference Board, 2009). Further, the link between employee attitudes and business performance has been established (Saari & Judge, 2004). For example, companies with engaged employees enjoy 26% higher productivity and a 13% advantage in shareholder returns (Watson Wyatt Worldwide, 2009). However, employee engagement numbers have dropped 9% since 2008, and nearly 25% among top performers (Miller, 2009). In 2004 and 2007, Watson Wyatt Worldwide reported that two out of every three companies surveyed expressed difficulty in attracting employees who possess the critical skills necessary to achieve business objectives. The issue is exacerbated by America’s distinction as having the highest mean turnover rate (i.e., 11%) in the world (Watson Wyatt Worldwide, 2007). Surveyed employers estimated that 37% of their employees were interested in alternative employment while 65% of their people admitted to looking elsewhere (Salary.com, 2009). The Conference Board (2009) found that 83% of respondents would be actively considering changing jobs when the economy improves. Yet, in 2001, three-quarters of the respondents in a study by The Randstad Review indicated that their interests were in long-term employment with a single entity. Something is driving them away.
The Conference Board reported in 2007 that its research found that job satisfaction reaches less than half of Americans workers. In 2010, The Conference Board reported that job satisfaction had fallen to a record low. Fewer than 30% are satisfied with their company’s performance review process, recognition programs, and opportunities for future growth. Just 30% of employees are happy with their pay (Society for Human Resource Management, 2009). And the beat goes on. In a study of job attitudes, Watson Wyatt Worldwide (2009) found that some 43% of American workers are uncommitted to their organizations. Only 32% said their companies’ fostered teamwork, and just 53% felt that they were aligned with business goals and objectives (Watson Wyatt Worldwide, 2009). Leadership and supervision continue their declining trend by receiving the lowest scores with 48% and 47% favorable ratings, respectively (Watson Wyatt Worldwide, 2009; Watson Wyatt Worldwide, 2007). Clearly, there is a lot of room for immediate improvement. In sum, this research closes in on whether intrinsic and extrinsic job satisfaction factors and affective commitment are related to the intention to quit among solid waste management drivers. The scope of this study included randomly selected drivers from separate unionized, privately held, and publicly traded operations of premier solid waste collection and disposal companies. The participants came from each of the industry’s three principle lines of business, namely commercial, residential, and industrial, which are most common and constitute the greatest source of revenue. Significance This is a study of first impression in the solid waste management industry. There is nothing of its kind that measures the influence of intrinsic and extrinsic job satisfaction
factors and affective commitment on intentions to quit among solid waste management drivers. It answers whether certain factors are influential and to what degree. The findings also contribute to an enlightened field of precision in targeting the most effective retention strategies for drivers that can lead to improved operational safety, organizational efficiencies, increased profitability, and competitive advantages in the solid waste management industry. Purpose of the Research The purpose of this research was to determine the antecedents to the intention to quit in an occupation characterized by a high degree of voluntary attrition. The results reveal opportunities for employers to align human capital strategies with key job satisfaction factors to gain affective commitment and improve operational performance. Comparisons within the three lines of business and between union and non-union operations are included in the results. Research Questions The research questions for this study are listed below. 1. Are intrinsic and extrinsic job satisfaction factors negatively related to the intent to quit? 2. Is affective commitment negatively related to the intent to quit? 3. Do intrinsic and extrinsic job satisfaction factors mediate in favor of affective commitment?
Hypotheses It is hypothesized that drivers with higher measures of extrinsic and intrinsic job satisfaction factors and affective commitment are less likely to intend to leave an organization. H1a: Extrinsic job satisfaction for drivers is negatively related to their intention to leave the organization. H1o: Extrinsic job satisfaction for drivers is not related to their intention to leave the organization. H2a: Intrinsic job satisfaction for drivers is negatively related to their intention to leave the organization. H2o: Intrinsic job satisfaction for drivers is not related to their intention to leave the organization. H3a: Affective commitment for drivers is negatively related to their intention to leave the organization. H3o: Affective commitment for drivers is not related to their intention to leave the organization. The Sub-Problems The First Sub-Problem. The first sub-problem was determining whether intrinsic job satisfaction factors influence the intention to quit. The Second Sub-Problem. The second sub-problem was determining whether extrinsic job satisfaction factors influence the intention to quit. The Third Sub-Problem. The third sub-problem was determining whether affective commitment specifically influences the intention to quit.
The Fourth Sub-Problem. The fourth sub-problem was determining whether intrinsic and extrinsic job satisfaction factors have a causal effect on affective commitment and the intention to quit. The Delimitations 1. The study was limited to drivers who work in the commercial, industrial, and residential lines of business in the solid waste management industry. 2. The study did not include any drivers outside the solid waste management industry. 3. The study did not include the industry’s liquid waste, hazardous waste, transfer, recycling, or container delivery drivers. 4. The study did not include solid waste management drivers employed by municipalities. The Limitations 1. The research sample was limited to employees from three separate operations. 2. The analysis of demographic data did not determine whether there is an effect of demographic criteria on the intent to quit. 3. The results could differ in various geographical locations. 4. The impact of the economy on the intent to quit was not addressed. 5. Other factors which may influence the intention to quit were not measured. Assumptions 1. It was assumed that all of the respondents were literate, credible, and reasonably accurate.
2. It was assumed that selected survey instruments were valid indicators of job satisfaction, affective commitment, and intentions to quit. Variables The dependent variable is the intention to quit. The independent variables are intrinsic and extrinsic job satisfaction factors and affective commitment. The research analysis sought to determine whether the job satisfaction factors mediate in favor of affective commitment (Trimble, 2006; Yousef, 2002). Definitions Intrinsic Job Satisfaction Factors. Herzberg (Herzberg et al., 1959; Herzberg, 1966) termed these as motivating factors that centered on achievement, recognition, responsibility, advancement, growth, and the work itself. Although their absence was not necessarily dissatisfying, when present, they could be a motivational force (Herzberg et al., 1959; Herzberg, 1966). Extrinsic Job Satisfaction Factors. The hygiene factors are supervision, working conditions, co-workers, pay, policies and procedures, job security, status, and personal life (Herzberg et al., 1959; Herzberg, 1966). They are not necessarily satisfying, but their absence could cause dissatisfaction. Affective Commitment. The measure of loyalty to the organization (Meyer & Allen, 1997). Intention to Quit. According to Elangovan, the intention to quit is “an attitudinal orientation or a cognitive manifestation of the behavioral intention to quit” (Elangovan, 2001).
Commercial Line of Business. The collection and disposal of non-hazardous solid waste from retail establishments, restaurants, and professional office buildings (Beck, 2001). Industrial Line of Business. The collection and disposal of non-hazardous solid waste from factories and construction sites (Beck, 2001). Residential Line of Business. The curbside collection and disposal of non- hazardous solid waste and yard waste from single and multi-family homes (Beck, 2001). In sum, this chapter has explained the nature of the study and its significance. It has shown that attrition is a problem for businesses generally, and the solid waste industry, specifically. Moreover, the evidence supports that the hypothesized antecedents to turnover, namely job satisfaction and affective commitment, also require management’s attention to realize the full potential of their performance objectives. The research questions and hypotheses sought the antecedents to the intention to quit. Further, limitations of the study are specified along with sub-problems and assumptions. The findings reveal valuable insights that provide guidance for enhanced operational performance. The next two chapters review relevant literature and the methodology for this research, respectively.
CHAPTER II Literature Review The literature supporting the research for the aforementioned study is discussed below. The review begins with a historical account of the development of motivational theory, including Herzberg’s (Herzberg et al., 1959; Herzberg, 1966) Two-Factor Theory and its application in related studies. Extrinsic and intrinsic job satisfaction and motivation factors are also defined. The appropriateness of that theory is shown by the cited research which illustrates the support and challenges to the theory when tested in various settings. Clearly, more research is warranted to further refine the theoretical applications of Herzberg’s work, particularly insofar as it applies to an understudied industry. In addition, the review examines the process and content theories with an emphasis on their relationship to job satisfaction. Further, social identity theory is discussed as it pertains to affective commitment. Much of the relevant research on extrinsic and intrinsic job satisfaction and motivation factors pivot off Frederick Herzberg’s (Herzberg et al., 1959; Herzberg, 1966) Two-Factor Theory and such is true in this case, too. Thus, its application is the focus of the review. The literature review then extends to other works that discuss the influence of extrinsic and intrinsic job satisfaction and motivation factors and their relationship to affective commitment. Against that background, literature regarding the intentions to quit is also reviewed.
Finally, the limited application of the theory to issues related to the solid waste industry will be recognized. In this regard, extant research will be discussed and distinguished. The Research Model This model for this research is shown below. It is based on Herzberg’s (Herzberg et al., 1959; Herzberg, 1966) Two-Factor Theory and will explore the relationship between intrinsic and extrinsic job satisfaction factors and affective commitment on the intention to quit. The research will also seek to determine whether there is a causal effect of job satisfaction factors on affective commitment and to what extent that has an influence on the intent to quit.
Figure 1. The Research Model developed for this study is based on Herzberg’s Two- Factor Theory.
Recognition Responsibility Advancement Growth The Work
Supervision Work Conditions Co-Workers Pay Policies Job Security Status Personal Life
Intent to Quit
No Job Dissatisfaction
Past is Prologue In the Preface of his seminal study, The Motivation to Work (Herzberg et al., 1959), Herzberg gave a succinct explanation for the importance of studying attitudes and job satisfaction. His comments follow and best illustrate the durability of the topic: Why study job attitudes? During the period when the study reported in this volume was conducted the answer seemed obvious. There was full employment, with nearly 100 percent utilization of plant and facilities. It was questionable whether the utilization of manpower was complete. Thus industry seemed to face a situation in which one of the crucial ways to expand productivity was to increase the efficiency of
the individual at the job . On the other side of the same coin, there was the continuing dread of the mechanization of people as well of jobs. There was a feeling that in a world in which there was a surfeit of material things man was losing zest for work, that man and his work had become distant and alienated. Thus, both from the point of view of industry and the point of view of the individual, it seemed
overwhelmingly necessary to tackle the problem of job attitudes. Let us be precise. To industry, the payoff for a study of attitudes would be increased productivity, decreased turnover, decreased absenteeism, and smoother working relations. To the community, it might mean a decreased bill for psychological casualties and an increase in the over-all productive capacity of our industrial plant and the proper utilization of human resources. To the individual, an understanding of the forces that lead to improved morale would bring greater happiness and greater self-realization. At the time of the present writing the world has changed somewhat. Our economy is so variable that it would be foolish to predict its state when this volume reaches the
public, but right now we are faced by significant unemployment, by an underutilization of our industrial plant, and by a shift of interest from the problems of boredom and a surfeit of material things to a concern for the serious social problems of unemployment and industrial crisis. Yet the problem of people’s relationships with their work continues to be a basic one. We should not overlook the fact that although the ebb and flow of our economy would produce occasional periods of both over and under employment the problem of an individual’s attitudes towards his job remains constant. In fact, it may be that during hard times the edge that will determine whether a concern will survive will be given by the level of morale within the personnel. (p. xxi-xxii) Efforts to understand the intricacies of employee motivation and job satisfaction can be traced to the beginning of the twentieth century (Locke & Latham, 1990). Frederick Taylor (1911/1967) introduced the science of incentive systems as a means of motivation. Frank and Lillian Gilbreth (1914/1973) added time and motion techniques to improve the design of work tasks. Indeed, Locke and Latham’s (1976) Goal-Setting Theory of motivation is based in substantial part on the work of Taylor and Gilbreth. The factors causing fatigue and monotony on workers were studied in Britain (Ryan, 1947). The celebrated Hawthorne studies provided insight into the relationship of peers and supervisors to job performance and employee morale (Roethlisberger & Dickson, 1939/1956). In 1935, Robert Hoppock sought to measure quantitatively job satisfaction. Rensis Likert (1961) centered his study on employee participation in
decision making. Later, Edward Lawler (1971) examined the effects of compensation on motivation. The genesis of the formal study of behaviorism is marked by John Broadus Watson’s (1913) work on learning concepts and emphasis on stimulus-response mechanisms. Interestingly, this was an extension of earlier conditioning work by Russian Nobel Prize Laureate, Ivan Pavlov (Pate, 1978). Watson claimed that either external or internal stimuli determined behavior through mechanistic or reinforcement behavior. In 1935, cognitive theorist, Kurt Lewin, introduced the intrinsic-extrinsic distinction which was later popularized by Herzberg (Broedling, 1976). Lewin viewed behavior as a function of the environment and the person. Of course, his work also evolved into the study of resistance to change that resulted in the famous three-step model regarding change (Lewin, 1951). Subsequently, an emphasis on needs and motives was advanced by Maslow (1943), McClelland (1962), Herzberg (Herzberg et al., 1959; Herzberg, 1966), and Alderfer (1972). Maslow’s (1943) categorical hierarchy of needs lists in defined order physiological, safety, love, esteem, and self-actualization as motivators. McClelland’s (1962) Learned Needs Theory of motivation included the need for achievement, affiliation, and power. As discussed in greater detail below, Herzberg’s (Herzberg et al., 1959; Herzberg, 1966) study revealed factors that contributed to employees’ satisfaction or dissatisfaction on the job. One of the intrinsic factors, the work itself, is linked to McClelland’s (1962) need for achievement since people interested in one tend to be interested in the other (Roberts, 1970). Herzberg’s theory was also found to be closely related to Maslow’s needs hierarchy (Weisbord, 1975). Alderfer’s (1972) Existence-