Journal of Balkumari College (2020), Vol.

9 Issue 1 59
Journal of Balkumari College
ISSN : 2467-9321 Website: http://www.nepjol.info/index.php/jbkc
Volume : 9, Issue : 1, June 2020, Page No.: 59-64

Dimensions of Job Satisfaction among Employees of Banking Industry in Nepal

Naba Raj Adhikari*

Associate Professor
Central Department of Management
Kirtipur, Kathmandu

ABSTRACT
Objective:
The purpose of the study was to find out the impact of employee empowerment, team work, bank facilities,
training, performance appraisal and quality performance upon job satisfaction of employees that how would
these factors affect employees’ job satisfaction in banking sector of Nepal.
Methodology:
Data was collected through questionnaire and the questionnaire was distributed among 200 employees of
twenty eight commercial banks. Random sampling technique was applied in this procedure. Correlation
coefficient and regression were used to analyze and interpret the data.
Results and Conclusion:
Regression analysis showed that employee empowerment, team work, and bank facilities affect positively
whereas training, performance appraisal and quality performance affect adversely on the job satisfaction
level of employees. There exists a positive relation overall and boost job satisfaction, which would in turn
enhance the productivity of the organization.

Article type: Research Paper

Key words: Bank employees; job satisfaction; banking services; Nepal.

INTRODUCTION
Job satisfaction is the discrepancy among people's expectations and wants related to the job, and what
is really offered to them. Job satisfaction is very important not only for employees but also for the success of
the organization (Lim, 2008) because if an employee is not satisfied with his job then he will not be loyal to the
organization and dissatisfaction with a job and/or lack of loyalty to the organization, may search for other jobs
(Reed et al., 1994). Job satisfaction can also be defined as the extent to which employees like their jobs. Studies
discuss the various aspects of the employee’s job satisfaction such as job, salary levels, promotion opportunities,
and relationship with co-worker. Hoppock (1935) first proposed the concept of employee satisfaction and identified
the individual response or happiness of employees with objective and emotional facet of their work environment.
Employee satisfaction, also called job satisfaction. Employee satisfaction defined as employees’ feelings
and thoughts about organization, work and co-workers (Beer, 1964). Locke (1976) proposed the theory of value,
and suggested that employee satisfaction does not address individual desires, but associated with employee’s
needs or principles. In case of a good salary package, work environment and chances to prospect in the future,
may positively influence the employee’s loyalty and ultimately increased job satisfaction. Job satisfaction is the
sensation and perception of the employee about the work and organization. Happy employees are more likely to be
welcoming and attentive which attracts customers and the employees not satisfied with the job can lead to customer
unhappiness (Hanif and Kamal, 2009).
The results of different studies, of job satisfaction are derived from two main sets. First, job satisfaction
is associated with increased output, efficiency of the organization, loyalty with the organization, and reduced
absenteeism and earnings (Ellickson and Logsdon, 2001). Wright and Davis (2003) explored that job satisfaction

* Corresponding author: adhikarinavaraj7@gmail.com

60 Journal of Balkumari College (2020), Vol. 9 Issue 1

positively affect on the ability, effort and capability of the employees however, if employees not satisfied with the
job then it may cause turnover intentions, increasing costs, decreasing profits and ultimately customer unhappiness
with the organization (Zeffane et al., 2008).

OBJECTIVE OF THE STUDY

The main objective of this study is to determine the factors which influence the satisfaction of employees
of commercial banks of Nepal. The following are the specific objectives:
1. To identify the factors affecting the job satisfaction of employees of banking industry in Nepal
2. To analyze the impact of employee empowerment, team work, bank facilities, training, performance appraisal
and quality performance upon job satisfaction of employees of banking industry.

REVIEW OF LITERATURE
Over the years, many studies have attempted to categorize and find out the factors that affect job satisfaction
(Abdullah et al., 2011) and found wages as the main factor for job satisfaction, but other factors such as the
promotion, recognition of work, and employees loyalty also considered. In addition, salaries and incentives are
the most important determinant of job satisfaction (Calisir et al., 2010). Ali and Ahmed (2009) concludes that due
to the changes in reward or recognition programs, there will be a corresponding change in work motivation and
satisfaction, this means that if there is a greater focus on remuneration and recognition, can have a positive impact
as a result of motivation and thus lead to higher levels of job performance. Moreover positive and significant
association found between job satisfaction and management practices such as team work, independence and
leadership positions (Hunjra et al., 2010).
Hanif and Kamal (2009), argues that if companies makes favorable strategies and rules for the employees
related to pay scales, policy development, staff input, and the work environment, may lead to employee engagement,
satisfaction and increased employee loyalty with the organization because satisfied employees are more likely to
be welcoming and attentive which attracts customers and the employees not satisfied with the job can lead to
customer unhappiness. Abdulla et al. (2011) examines the relationship between job satisfaction and environmental
and demographic factors and found environmental factors (such as salary, promotion and supervision) better
predictors of job satisfaction as compared to demographic factors (such as sex, age and education level as well
as other factors related to their work experience, such as job level, shift work, and years of experience). Rumman
(2011) concludes that there is no statistically significant association between demographic factors, and their
working environment in travel and tourism companies in Amman and a statistically significant correlation was
found between the nature of the employee's job and job satisfaction in the travel and tourism companies in Amman.
Employee satisfaction relates to the design of compensation system for a business, because payment
strategies based on compensation system and should appreciate (Lai, 2011). Lai (2011) argue that an efficient
compensation system result in organizational growth and expansion and exhibit a positive relationship between
employee satisfaction and job-based wages, skill-based pay and performance-based pay. The study highlighted
that the intrinsic factors of motivation, including recognition, work, career opportunities, professional growth,
responsibility, good feeling about the organization that has a significant correlation with job satisfaction, while
hygiene (external) factors have no significant relationship with job satisfaction of employees satisfaction.
Locke (1976), explained that there should be clear policies and strategies in the organization which
makes easy for employees to understand their tasks and objectives etc because otherwise it may lead toward
dissatisfaction. Abdulla et al., (2011) identified communications and job stress an important determinant of job
satisfaction and found no significant influence on job satisfaction whereas significant relationship found between
job satisfaction and its determinants (salary and incentives, organizational policy and strategy and nature of the work).
In addition, significant differences found between the gender, qualifications, experience, job characteristics
and job satisfaction (Ahmed et al., 2010). It can be concluded that the salary, promotion and training positively and
significantly influence the job satisfaction. However, employees place more emphasis on pay and promotion of the
program (Butt et al., 2007). Akbar et al., (2011) confirms that empowered employees leads towards higher levels of
employee satisfaction (Akbar et al., 2011). Calisir et al. (2010) found a very strong influence of job satisfaction on
Journal of Balkumari College (2020), Vol. 9 Issue 1 61
organizational commitment whereas job stress and role ambiguity indirectly influence the willingness of employees
to leave their jobs.
Hansia (2009) concluded that the majority of people or employees agree that personality type suits the
work they do, and have the opportunity to do what they do best and they are also optimistic about their personal
and professional life (Hansia, 2009). Hansia (2009) demonstrate that the procedures for recruitment and selection
are an important predictor of job satisfaction of employees, and fair policy of recruitment and selection leads to
employee satisfaction at work.

RESEARCH QUESTIONS
1. What are the major determinants of employee’s job satisfaction?
2. How these determinants impact on employee’s job satisfaction?

RESEARCH FRAMEWORK
There are various determinants of job satisfaction. Among them, only six independent variables were used
to evaluate the impact of independent variables on job satisfaction. To carry out research successfully, the following
research framework has been designed:

Independent variables
Employee empowerment,
Team work,
Dependent variable
Bank facilities,
Job satisfaction
Training;
Performance appraisal
Quality performance

RESEARCH DESIGN
Population & Sample size
Population includes employees of all the branches of 28commercial banks of Nepal established at the end
of July, 2018. All together, there are 20,238 employees working in these banks. Out of that 200 employees were
selected for analysis. In this study, random sampling technique is used to select samples.

Data Collection Methodology

The instrument used for data collection was questionnaire on 5-point likert scale from strongly agree to
strongly disagree, where point-1 indicate strongly disagree, 2 disagree, 3 neutral, 4 agree and 5 strongly agree,
developed by Abdulla et al., (2011), Hansia (2009) and Calisir (2011). However, little modifications were made in
the questionnaire. 360 questionnaires were personally administered among the respondents but received only 200
questionnaires which indicate the 56% response of the respondents.

Linear Regression Equation

To determine the determinants of job satisfaction among employee of banking industry in Nepal, it would
be beneficial to apply linear regression to the dependent and independent variables. The regression line gives an
estimation of the linear relationship between a dependent and one or more independent variables. Therefore the
equation for multiple regression models is:
Sat_E = β0 +β1Ee + β2Tw + β3Bf + β4T + β5Pa +β6Qp + …+et
Where,
Sat_E – Job Satisfaction of Employee
Ee=Employee empowerment Tw=Team work Bf=Bank facilities T=Training Pa=Performance appraisal
Qp= Quality performance et= error term
62 Journal of Balkumari College (2020), Vol. 9 Issue 1

DATA ANALYSIS AND FINDINGS

To meet up with the objectives of study, 200 employees were selected as sample unit. The questionnaires
were thus filled by 200 respondents which were structured with questions of economic and demographic profiles
such as gender, age, qualification, experience, position, bank type, satisfaction level and dimension which play
an important role in providing satisfaction to the employees. To carry out the study in a more accurate manner,
convenience random sampling method was selected. Tabular description, mean scores, and multiple regression
models were used as tools for statistical analysis and to present the interpretations.

The economic and demographic profiles of respondents

The first part of this questionnaire was designed to collect personal information of respondents such as
their gender, age, academic qualification, position, and experience and bank type of employees. The economic and
demographic profiles of the employees of commercial banks is residing in (Table.1)

Table: 1 Profile of Respondents

Gender No. Age yr No. Education No. Position No. Experience yrs No. Bank No
Male 124 Below 30 65 Up to +2 22 Assistant 136 Below 5 116 Public 94
Female 76 30-45 120 Bachelor 114 Manager 64 5 to 10 46 Joint vent. 42
Total 200 Above 45 15 Above bachelor 64 Total 200 Above 10 38 Private 64
Total 200 Total 200 Total 200 Total 200
Source: Survey of Employees’ Responses of the Commercial Banks, 2018

The investigation shows that 62% of the respondents are male and 38% are female. Among these, 32.50%
respondents are from age group below 30 years, 60% are from age group 30 – 45 years, and 7.5% are from age
group above 45 years. In terms of academic qualification, only 11% have completed up to Plus Two level, 57%
are graduates, and the remaining 32% respondents are post graduates.
All of the respondent employees are grouped into two levels. Among them, 68% employees are in
assistant level and remaining 32 % are in managerial level. On the division based on experience, about 58% of
the respondents have less than 5 years of experience, 23% have 5 to 10 years of experience and only 19% of the
respondents have more than 10 years of experience. During analysis, it has been noted that most of the employees
have short experience in their job. They are working in public, joint venture and private commercial banks. 47%
employees were selected from public banks, 21% from joint venture banks and remaining 32% employees were
selected from private commercial banks.

Dimensions of job satisfaction

From the long period of time, many studies have attempted to categorize and find out the factors that affect
employee satisfaction (Abdullah et al., 2011) and found wages as the main factor for employee satisfaction, but
other factors such as the employee empowerment, team work, bank facilities, training; performance appraisal and
quality performance also considered. By applying multiple regression models, the following results were obtained:

Table 2: Regression Equation of Job Satisfaction on Bank Services

Sat_E = β0 +β1Ee + β2Tw + β3Bf + β4T + β5Pa +β6Qp + …+et
=3.9 +0.15Ee +0.36Tw +0.12Bf -0.08T -0.18Pa -0.10Qp
S.E. =(0.35) (0.05) (0.21) (0.08) (0.03) (0.11) (0.04)
T =(10.99) (2.86) (-5.57) (2.41) (-4.73) (4.13) (-7.30)
R =0.39
2
F=26.55
No. of obs=200 d.f.=5, 194
Note: * significant at 0.01 levels
** significant at 0.05 levels
*** significant at 0.1 levels
Journal of Balkumari College (2020), Vol. 9 Issue 1 63
Where,
Sat_E – Job Satisfaction of Employee
Ee = Employee empowerment Tw = Team work Bf = Bank facilities T = Training
Pa = Performance appraisal Qp = Quality performance
Above table describes regression results from multiple regression models. As it is noted, the explanatory
power of the model in this study is reasonably high given by the R2 at 0.39 for the satisfaction of employee model.
The F statistic of this model is statistically significant at 1 percent. It is hypothesized that the signs of all predictors
would be positive in this model. Here signs of T, Pa and Qp showed a negative impact on employee satisfaction
which is just the opposite as per priori. Remaining predictors Ee, Tw and Bf showed positive signs as per expectation.
Here Ee associated with a partial regression coefficient of 0.15 and signifies that for every additional percent on
the Ee, it is predicted a gain of 0.15 percent on the job satisfaction if the effects of other controllable variables
kept constant. Similarly, Pa is associated with a partial regression coefficient of -0.18 and signifies that for every
additional percentage on the Pa, it is predicted a decrement of 0.18 percent on the job satisfaction of employees if
other variables kept constant.

CONCLUSION
The purpose of this study was to identify the determinants of job satisfaction and examine its impact on
employees of the banking industry in Nepal. The results conclude that all the variables employee empowerment,
team work, bank facilities, training; performance appraisal and quality performance have significant association
with employees’ job satisfaction. Among six variables, employee empowerment, team work, bank facilities have
positive impact on job satisfaction whereas training, performance appraisal and quality performance have negative
impact on job satisfaction of bank employees.
In light of these findings, banking industries might want to construct a more comprehensive employee
career development program that not only helps in improving employee satisfaction, but also heighten a sense of
loyalty in them. Factors such as employee empowerment, team work, and bank facilities variables which seem
to positively correlate suitably to employee satisfaction and loyalty whereas training, performance appraisal and
quality performance had adverse effect on job satisfaction.
Performance appraisal plays a role to increase the employee satisfaction in this study. Jawahar (2006),
argued that performance appraisal as an important element of satisfaction because it is positively related to job
satisfaction, organizational commitment and negatively related to turnover intentions.
The findings of this study could be used by managers in commercial banks in developing their staff training
program in order to create satisfied and loyal workers. Commercial banks should be mindful of satisfaction variables
such as: recognition and rewards, teamwork and cooperation, working conditions, and relationship with supervisor.
The training programs should make the employees confident that the company is transparent and sincere about the
satisfaction variables such as mentioned in the preceding sentence. However, a future extended study that evaluates
a wider scope of employee satisfaction and loyalty dimensions in the banking industry should be conducted using
a sample.

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