The Journal of Commerce, Vol. 3, No.

4,
ISSN: 2218-8118, 2220-6043
Hailey College of Commerce, University of the Punjab, PAKISTAN
EXPLORING THE RELATIONSHIP BETWEEN SALARY
SATISFACTION AND JOB SATISFACTION: A COMPARISON
OF PUBLIC AND PRIVATE SECTOR ORGANIZATIONS
Muhammad Shahzad Chaudhrya cases. Furthermost, salary satisfaction proved
Hazoor Muhammad Sabirb as a facilitator designed for augmenting job
Nosheen Rafi satisfaction level of employees.
Masood Nawaz Kalyarc
Key Words: Salary satisfaction, Job satisfaction,
public and private sector, Pakistan
Abstract
The purpose of presented study is to develop a
INTRODUCTION
model that measures the degree of difference in Salary or pay is a form of episodic
salary satisfaction and its impact on job
compensation from a firm to its worker, which is
satisfaction in public sector organizations and
completely stated in an employment contract. It
private sector organizations in Pakistani
is weighed with piece wages, where each job,
context. Salary satisfaction affects job
period of job (timings) or other unit is paid
involvement, work inspiration, employee
distinctly, rather than on a periodic basis. Pay is
performance and motivation. The posited
perhaps striking good to most individuals
hypothesis is if there exists a significant
difference in the degree of salary satisfaction in because it offers them a corresponding level of
public sector and private sector organization, purchasing power. While running a business,
and the positive influence of salary satisfaction salary can also be considered as the cost of
on job satisfaction in both public and private gaining human resources for running systems
sectors. Data was collated from 160 employees and operations, and they are designated at
(total 320) from each sector organizations. Z- different position and employer bear personnel
test was used to analyze the degree of difference disbursement or salary expense. Wage, salary or
between salary satisfactions in both sectors, pay is considered a significant reward to
although its relation with job satisfaction was motivate the workers and their behavior
measured by regression analysis. The findings towards the goals of employer (Oshagbemi,
indicate that employees in public sector 2000). All other social factors are important for
organizations have little higher salary enhancing and to make job satisfactory for
satisfaction as compared to private sector employees are significant but satisfaction from
employees. Moreover, salary satisfaction is also pay is must. Pay gratification be liable to the
positively related with job satisfaction in both adjustment between real pay and the amount of
pay, a person received from his/her employer.
Salary gratification is an abundant narrower

Corresponding author. Contact construct than job satisfaction. The pleasure
m4maina@[Link]. She is MS Scholar at from pay satisfaction is also an important thing
National University of Modern Languages that is linked to some administrative outcomes
(Lahore Campus), Pakistan. and success. For example, some evidence
a. He is assistant professor at National proposes that dissatisfaction with pay can lead
University of Modern Languages (Lahore employee to decreased job satisfaction,
Campus), Pakistan. decreased interest of working, and decreased
b. He is associate professor and dean of Faculty the learning level of employees, motivation and
of Management & Administrative Sciences, GC performance, increased absenteeism and
University Faisalabad, Pakistan. turnover, and more pay-related grievances. It is
c. He is Lecturer at College of Management & also extensively studied that pay satisfaction
Administrative Sciences, GC University positively influence overall job contentment,
Faisalabad, Pakistan. motivation and enactment, performance, and
lead to less absenteeism and turnover behaviors

1
 Exploring the relationship between salary satisfaction and job satisfaction

of employee (Judge, Cable, & Higgins, 2000). As using a worldwide measure which blows the
studied by Sweet, Nelson, and Moberg (2006), extent to which contributors like their job and
there is positive influence of pay satisfaction on the organization. Carraher, Carraher, and
job satisfaction and it can obviously observe in Whitely (2003) exemplary proposed that job
every field of life. Sweet et al. (2006) critically satisfaction highly influence pay satisfaction
examined that the employee satisfaction level comprising actual salary satisfaction level and
has little relationship to income and is similar job satisfaction significantly augmented
across most variables for example working modification for each measurement of pay
environment, professional uniqueness, amount satisfaction.
of scientific activity in work, whereas income
gratification showed stronger association to real Separately from affectivity either positive effect
income, at least at the higher income ranks. or negative effect satisfaction connected to pay
They also originate that the association between can be well explained in the light of individual‟s
job satisfaction and pay satisfaction is high, thinking elegance. Method of rational salary
whereas job satisfaction is not connected with structure seems to be a significant feature of
years as employed. The customary rational of employee connected to pay satisfaction.
not relating monetary reward with the Pritchard (1969) originate that corporate worker
contentment is lessening. In fact, these days‟ who are involved in thinking themselves to
acquisitiveness and materialism is becoming key different thought for the creation more money
factor of inspiring and motivating persons. than others, more displeased with their wages
Cummins (2002) has critically discussed that in than the workers who associated themselves to
spite of the conservative wisdom that others creating the same or less money.
„„monetary rewards have little significance to LawlerHI (1985) originate that individuals who
happiness”. Diener and Seligman (2004) studied expect higher monetary rewards in the
the applicable literature and determined that as upcoming times are less satisfied with their
a culture gathers wealth, „„differences and current pay.
modifications in wellbeing are less often due to
income, and are more often due to factors such Frey and Feld (2002) emulated in their
as people‟s social relationships and pleasure at experiential indication which is reported by
work place”. It has been observed that constancy economists that pay satisfaction is more
in pay in terms of getting monthly pay is much important factor of success in an organization
desired by the personnel as compared to success. For example, the study of McCausland,
enticement based salary packages which are Pouliakas, and Theodossiou (2005) shows
adjustable in nature. Diener and Seligman (2004) momentous positive effects of motivation pay
specified that with the much inferior income, job on efficiency (in the range of a 44-percent gain)
contentment and income satisfaction are slightly in his sole dataset of a firm (Safelite Glass
higher. The sales people salaried through mostly Company) that experienced variations in its
fixed salary exhibit higher levels of job compensation plan. Yet, it may be that
satisfaction and lesser turnover intentions than economists recognized the short run welfares of
their colleagues who are paid through mostly enticements, and any long run undesirable
enticement pay are at dissatisfactory behaviors effects on motivation and job satisfaction
about their job. postulated by psychologists. Judge et al. (2000)
found if job usefulness be contingent on both the
In the wider logic it might be possible that pay level of pay and on pay relative to some
satisfaction and job satisfaction usually situation or objective level, it is strong that
balancing to each other. Rice, Phillips, and incentive pay could meaningfully emotional
McFarlin (1990) identified that several job impact on job satisfaction through both of these
satisfaction measures including pay satisfaction courses of action. Attitudes around as well as
(typically pay level satisfaction) as a about work remain formed the rewards
measurement, we control for job satisfaction produced by performance and enactment of

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The Journal of Commerce, Vol. 3, No. 4,
ISSN: 2218-8118, 2220-6043
Hailey College of Commerce, University of the Punjab, PAKISTAN
employees, which are valued consequences in pay-for-performance is a positive stimulus on
themselves. The objective of presented study is pay satisfaction. Omar and Ogenyi (2006)
to raise salary satisfaction in organizations. In observed that perceived associations between
relationship of job satisfaction, motivation, and pay and performance account for additional
to decrease the turnover and absenteeism rate changes in pay increase satisfaction than entire
among employees of both sectors demographic variables put together.
Consequently, launching a pay-for-performance
THEORETICAL BACKGROUND salary system may be the greatest effective
technique to encourage salary level satisfaction.
Salary satisfaction According to Clark and Oswald (2002), the
receiving of performance-based rewards,
Pay is vital but the awareness of individual
including pay increases and bonuses, absolutely
about salary is more vital. People with positive
affected pay-system responses. So, they
attention seem to be much satisfied with pay
recommended that “founding a pay-for-
relative to people with negative affectivity.
performance salary scheme may be the most
Organ (1994) claimed that both positive and
active way to encourage pay satisfaction”. As it
negative affectivity stand as key factors of job
is also predicted by LawlerHI (1985) that regular
satisfaction. But the individuals who have
salary Satisfaction and pay Pleasure co-vary in a
extraordinary on negative affectivity are
positive course and help people to move their
nervous and worried (emotional state that may
thinking towards positivity or positive thinking.
designate an anxious personality), but that does
The association between performance and pay
not suggest across-the-board displeasure. High-
satisfaction is also momentous. Apparent
negative affectivity persons may be discontented
performance, acuities regarding management,
with characteristics of their jobs, but that does
developments of opportunity, and the
not essentially mean that they would be more
corporation's benefit package, and both external
disappointed with their salary. Organization
and internal pay equity, were related to pay
possession is also an imperative reason in
satisfaction in the direction prophesied by
determining of pay satisfaction and contentment
Lawler's model.
of employees. Solomon (1986) suggested that
public sector executives experience lower Professed distributive justice is confidently
intensities of job and pay satisfaction. Low related to pleasure with incentive policies.
performance of employees may be a Distributive integrity is one of the perceptual
consequence of low levels of satisfaction with variables that have been found to be a robust
their salary. A pay motivation scheme is a interpreter of pay satisfaction (Fong, Shaffer, &
different measurement of pay satisfaction. In Centre, 2001). Perceived procedural justice is a
modern ages, there remained a cumulative trend positive measurement of pay satisfaction.
for public and private administrations to Distributive justice and procedural justice both
implement additional inspired and creative are also originated to be factors of pay
procedures of wage enticement such as group raise/management satisfaction. Over, this is
incentives, and profit distribution schemes. similarly in streak with other exploration results
Carrell and Dittrich (1978) also stated that (Munro & Sugden, 2003). McFarlin and Sweeney
motivation plans that used many distribution (1992) found that distributive justice remained a
rules would move towards different magnitudes more vital analyst of pay level contentment than
of pay satisfaction. So it is anticipated that technical justice. Markova and Jones (2003)
distributive justice will affect satisfaction with found that perceived impartiality of pay
motivational incentive plans. determination policies and procedures was the
sturdiest analyst of pay contentment among four
For making pay satisfaction and job satisfaction
sets of pay processes (salary determination,
organizations have to encourage a strategy of
performance assessment, communication and
perception of pay-for performance. Insight of
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 Exploring the relationship between salary satisfaction and job satisfaction

appeal). Perceived interactional impartiality by expresses against the existence of compensating

personnel is an optimistic influence on pay salary differences, but is reliable with the
pleasure and satisfaction with incentive plans. opinion that the Finnish labor market purposes
in a non-competitive fashion.
Flaherty and Pappas (2002) critically explored
that employee have lower satisfaction and Salary Satisfaction as an Antecedent of Job
higher turnover intentions when paid a fixed Satisfaction
salary, while salespeople in higher satisfaction
and lower turnover intentions when given Association of education with salary
incentives. Moreover, throughout the satisfaction was found in many academics
establishing stage, salespeople working in a firm writings. According to Ganguli (1957), the
following a prospector or analyzer policy dynamics complicated in the association amid
designate greater satisfaction then lesser education and pay satisfaction are perhaps at
turnover objectives than persons working in a exertion in many other fields of satisfaction.
competitor firm. Flaherty and Pappas (2002) Satisfaction with salary may stand a legal
likewise described that throughout the relationship to demographic statistics and as
consideration stage, salespersons salaried such are foretold from, and perhaps determined
through mostly permanent income exhibiting by, organization strategy. Higher paid managers
greater ranks of job satisfaction in addition to and advanced level executives seem to be well
lesser turnover objectives than their colleagues satisfied with pay received by them. Andrews
who are waged through mostly incentive or and Henry (1963) for example, must originate
enticement pay. that advanced education appears to be
concomitant with inferior satisfaction with
Pay satisfaction too depends on employee‟s salary. Organization level and quantity of salary
intention about job safety. Safety pursuers are are connected with managers' satisfaction with
more content from job than pay increase their pay. Klein and Maher (1966) state “The
pursuers. Kathawala, Moore, and Elmuti (1990) first-level executives who had advanced
presented an inclination for augmented salary education are a lesser amount of satisfaction
satisfaction over increase in job security. with their salary. Klein and Maher (1966)
Individuals who favored a salary satisfaction analyzed that the institution cultured employee
increase established a less satisfied approach must designate more negative feelings about his
with present salary satisfaction and overall pay satisfaction than the non-institution
satisfaction with the job. Persons favoring cultured employee. Their motivation is
increased safety categorized safety greater than constructed on the idea that devouring an
salary satisfaction as a satisfier, but not as a institution education improves one's self-
motivator. Those favoring a salary increase evaluation and thus clues to complex prospects
categorized compensation higher than job safety with affection to pay satisfaction chances. This,
as a motivator and a satisfier. in turn, would lead to superior pay satisfaction
displeasure".
A decent remuneration and compensation
packages appears to exist worst if working McCausland et al. (2005) found that though the
circumstance are not clean and appropriate for prophesied job satisfaction of workforces
employees. So, with salary an organization has receiving performance related salary is lesser on
to provide vigorous working conditions. typically likened to those on other pay
Böckerman and Ilmakunnas (2006) originate that arrangements, performance related pay employs
adversative working circumstances must have a positive consequence on the mean job
an actual slight character in the determination of contentment of high-paid employees. A possible
individual income. In contrast, contrary enlightenment for this configuration might be
employed conditions substantially reduction the that for lower-paid wage earner performance
level of job satisfaction and the sensitivity of related pay is apparent to be regulatory,
justice of pay at the workplace. This indication whereas higher-paid employees originate a
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The Journal of Commerce, Vol. 3, No. 4,
ISSN: 2218-8118, 2220-6043
Hailey College of Commerce, University of the Punjab, PAKISTAN
utility benefit from what their estimation as substances are expressed to blow existing
sympathetic reward arrangements. Hölmstrom satisfactions.
(1979) were among the major establish the
theoretical supremacy of performance-related Employees enjoying high salaries are more
wage over other reward systems when likely to observe enticement recompenses as
monitoring strength is costly and flawed. supportive. According to Maslow‟s (1943)
Pouliakas and Theodossiou (2009) who showed hierarchy of needs, additional income may
that an important change in the job contentment assistance in the contentment of esteem needs
of performance linked pay and non- for the reason that high salary suggests high
performance linked pay employees are, once capability and overall individual value. So, even
modifies for the instantaneous relationship after satisfaction of basic physiological and
between job satisfaction, enticements and security needs are not issue, a number of people
salaries. Similarly, Job involvement is situation drive value high salary as an indicator of
of appointment with one‟s job, classifying with proficiency and individual value (Malka &
one‟s work, and observing the job as dominant Chatman, 2003). Performance salary is assessed
to one‟s uniqueness and self-esteem, unevenly because it is problematic to measure
opposite to the idea of isolation or insignificance quantitatively, that it can encourage individuals
(Fisher, 2010). to emphasis too barely, that it can weaken
intrinsic interest, which monetary rewards only
Some social researchers sightseen the link of age work for selected people, that it is harmful to
and seniority with salary satisfaction. It has been team-work and co-operation and that general
experiential that age and seniority are pay costs can upsurge earlier if not strongly
meaningfully related with salary satisfaction. measured (Armstrong & Murlis, 2005). Boselie,
Lawler III and Porter (1967) devised that streak Paauwe, and Jansen (2001) stated that
or Line/staff type of position, seniority, period performance pay must be a crucial instrument
in position, business or organization extent, and by administration for improving performance,
age bore little but statistically important but they stress certain circumstances must
relationships to salary. Age and seniority are happen for success. These are the requirement to
also virtuous predictors of genuine salary. Age encourage the trust that performance creates a
and seniority fix main things to better job modification and the must to modify the pay
enactment, and thus the associations originate structure to the condition in all organization.
between age and salary and seniority and salary Divergent to general endorsements they also
must be imitating the fact that administrations advise that pay and performance must be joined
are paying for excellence. Genuine salary was slackly, arguing that the tighter the linkage, the
the only demographic variable that is initiated to more problems are exaggerated. It‟s an effort
be equally linked to satisfaction with salary. determine the different degree of salary
satisfaction in public and private sector
Forthcoming expected incomes as a possibly organization of Pakistan and how much Salary
positive referent that simplifies to an assessment satisfaction enhances the job satisfaction level in
of their existing salaries. Andrews and Henry both public and private sector in Pakistani
(1963) created that persons who observe better organizations. It also reveals the level of
chances to make additional money in the future happiness among people who are employed by
on their present occupation are also the government or in private sector.
comparatively satisfied with their present
salaries structure point both with internal A model of salary or pay satisfaction and Job
assessments and external assessments. It seems satisfaction is established for the present
that, with our people, contentment with salaries research. In explorations of research it is actually
is incompletely determined by future forecasts vital to hypothesize the understandings. On the
on the same job however the pay satisfaction foundation of wide literature survey scholars
recognized 10 corporate dimensions (variables)
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 Exploring the relationship between salary satisfaction and job satisfaction

which are partaking conventional influence on distributed to get data: one hundred
salary satisfaction. questionnaires to each organization. A total
three hundred and forty six responses were
INSERT FIGURE 1 HERE received: one hundred and sixty responses from
public sector and one hundred and seventy six
Ten dimensions or variables to measure salary
from private sector organizations. However, we
satisfaction are adopted from Sharma and Bajpai
excluded sixteen responses received extra from
(2011). The model of Cammann, Fichman,
private sector to balance the number of
Jenkins and Klesh (1979) was used to measure
responses.
job satisfaction which is composed of three
items. In public sector 69% (111) male 31% (49)
respondent were female, among those 65% (104)
With the help of brief overview of literature the
having post graduate 30%(49) graduates and 5%
subsequent objective of research is to determine
(7) were under graduate and there were 41%(66)
the diverse amount of salary satisfaction in
employees having experience more than 15
public and private sector organization and how
years, 22% (35) having experience more than 10
much Salary satisfaction enhances the job
years and 20% (32) have more than 5 years of
satisfaction level in both public and private
experience 17% (27) employees have experience
sector organizations. The study also helps to
of 2 years.
determine satisfaction level of people in public
and private sector as well as their contentment In private sector 82.5% (132) male 17.5% (28)
with their salary system. respondent were female, among those 77.5%
(124) having post graduate, 22.5% (36) graduates
Difference in salary or pay satisfaction can be
and 6% (11) employees having experience more
measured through assessing the summated
than 15 years, 18.7% (30) having experience
difference between public and private sector
more than 10 years and 56.6% (89) have more
organization. To assess the statistical substantial
than 5 years of experience 18.7% (30) employees
difference, main hypothesis is created.
have experience of 2 years.
Furthermore a hypothesis is created to quantify
the linear impact of salary satisfaction on job Construct Measurement
satisfaction level of public sector employees
A questionnaire having ten dimensions of salary
H1: There exist significant difference in the satisfaction and three dimensions of job
degree of salary satisfaction of employees in satisfaction was used to collect data. The present
public sector and private sector organization. study stands on the various dimensions for
difference in salary satisfaction of public sector
H2: Salary satisfaction has significant linear organizations in addition to private sector
influence on job satisfaction of employees in organizations.
public sector.
Salary satisfaction it was measured through ten
H3: Salary satisfaction has significant linear independent dimensions (variables). Ten
influence on job satisfaction of employees in measurements are adopted from the model of
private sector. Sharma and Bajpai (2011) that are foundations of
salary satisfaction. Each variable is measured by
METHODOLOGY means of five point rating scale ranging from
Data Collection and Sample „strongly disagree‟ to „strongly agree‟ with
„neutral‟ as the central point. Internal
Data were collected from managerial consistency of the scale is measured by
and non-managerial employees of two public Cronbach‟s alpha whose value found as 0.79.
sector and two private sector organizations. A
total of four hundred questionnaires were
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The Journal of Commerce, Vol. 3, No. 4,
ISSN: 2218-8118, 2220-6043
Hailey College of Commerce, University of the Punjab, PAKISTAN
Job satisfaction the questionnaire developed by independent variables. The outcomes from the
Cammann, Fichman, Jenkins and Klesh (1979) analysis exhibited the coefficients for paths from
was used for the assessment of job satisfaction independent variables to dependent variables.
and its construct is composed of three items. Subsequent headings for public and private
Each variable is measured by means of five sector were generated from regression analysis
point rating scale ranging from „strongly using “Enter” method.
disagree‟ to „strongly agree‟ with „neutral‟ as the
central point. Internal consistency of the scale is Table 2 (a) shows regression analysis designed
measured by Cronbach‟s alpha whose value for job satisfaction level and salary satisfaction
found as 0.82. in public sector organizations. R2 value was as
57.8% which showed of strong predictor model
FINDINGS because R2 is a statistical term used how good
one term (Salary Satisfaction) is at predicting
For the testing of the hypotheses MS another (Job satisfaction). The value of R2 ranges
Excel and SPSS software are used. Z-test (using from 0 to 1, a higher value signifies strong linear
MS Excel) is used for comparing means as it is relationship, but here in public sector the value
used for the analysis of comparing means of two is moderating. Hence, consequences of the
populations. It requires a simple random sample present study offered a moderate linear
from a population with a Normal distribution relationship between dependent variable (salary
and where the mean is known. Regression satisfaction–Public Sector) and independent
analysis (through SPSS) is used for the variable (job satisfaction- Public Sector). The t-
measurement of linear influence of salary stat, joined with its p-value, designates the
satisfaction on job satisfaction for public sector implication of the relationship between the
organization and measuring linear influence of independent and dependent variable. The t-
salary satisfaction on job satisfaction for private statistics and its linked two-tailed p-values are
sector organization. used in testing that the coefficient is
meaningfully diverse from zero. By an alpha (α)
INSERT TABLE 1 HERE of 0.05, the beta value for job satisfaction is
significantly different from 0, since its p-value is
Table-1 shows the results of “Z-Test: Two
0.000, that is lesser than 0.05. So, we discard the
Sample for Means” for Salary Satisfaction. For
null hypothesis (Kalyar, 2011).
the testing of H1 means of salary satisfaction are
compared in public sector and private sector INSERT TABLE 2 (a, b & c) HERE
organizations through z-test is. The z-value is
2.745 which fall in the rejection region (as it is Table 2 (b) illustrate that F-value is significant
greater that the value of z-critical at 5% level of which reveals overall significance of regression
significance). Hence, null hypothesis of no model. Table 2 (c) displays t-value and p-value
difference is rejected and alternative hypothesis for testing the slope of the regression model.
of significant difference is accepted. So it is Significant p-value and value t-value is an
concluded that there is a significant difference indication of linear relationship between job
between salary satisfaction of employees in satisfaction and salary satisfaction.
public sector and private sector organizations.
Public sector organization employees are more INSERT TABLE 3 (a, b & c) HERE
satisfied and from their salary (mean=28.317) as
compared to private sector organizations Table 3 (a) displays regression statistics for job
(mean=26.25), see table 1. satisfaction level and Salary Satisfaction in
private sector organizations. R2 value was as
In order to test H2 and H3, regression analysis 23.4% which is an indication of less strong
was run: job satisfaction was taken as dependent predictor model because R2 is a statistical term
variable and salary satisfaction taken as used how good one term (Salary Satisfaction) is

7
 Exploring the relationship between salary satisfaction and job satisfaction

at predicting another (Job satisfaction). Co- progressively significant to deliver a positive

efficient measure is similarly presenting t- work condition to safeguard worker constancy.
statistics. The t-statistic exists as ratio of the Job involvement similarly affects expressive
variable of an estimated limit from its exhaustion and affects job satisfaction. It
speculative assessment and its standard error appears that personnel unknowingly relate their
and used to examine hypotheses about the salary satisfaction with job safety. If the worker
regression coefficients that the slope of a is specified extra autonomy to do his/her job,
regression line diverges considerably from 0 or can appreciate its nature of work very well,
not. Table 3 (b) shows that F-value is significant which progresses, expectation with their
which showed overall significance of regression association and that will make them to act in
model. Table 3 (c) described t-value and p-value learning conditions and they will be extremely
for testing the slope of the regression model. involved in job (Sudha, 2011). Employees those
Significant p-value and t-value is an indication are acting in advance will show more
of linear relationship between job satisfaction commitment than those who are waiting for the
and salary satisfaction. instructions of their directors.

DISCUSSIONS AND CONCLUSION The motive of it might be again can be described

by the conventional thinking of Pakistani
Findings of the study show that salary employees that they feel more safety (like
satisfaction score is little high for public sector termination) in public sector. In Pakistani
organizations as linked to private sector context job satisfaction reflect the chief
organizations. There are certain pay systems foundation of happiness. Similar outcomes are
usually would be favored by job holders, that experienced in the presented study. However
these pay schemes would affect employee salary structure and system is comparatively
attraction to organizations and different types of feel good and higher in private sector
job holders would be involved to different types administrations but it was supposed lower due
of pay systems. The best system for equity and to the issues like un-stability and insecurity as
justice in pay system is likewise Equal pay for well as anxiety of job pressure of job. The job
work of equal value. Now it comes in almost satisfaction in private sector employees is not
inseparably associated with the application of very less because the private sector is initiator of
job assessment (Rubery, 1995). Present learning environment in Pakistani context.
developments to performance-related pay Comparatively safe position of job usually
systems are important for each and every kind perceived by employee has provided much
of organization. When the organizations project „salary satisfaction‟ to employees of public sector
compensation packages, they often option to organizations regardless of that fact their wage
implementing an off the- shelf or “flavor of the is lesser than the wage of private sector
month” design rather than adapting their organizations personnel. Also the study of
programs to fit their organizations‟ précised Cacioppe and Mock (1984) showed that private
needs as it is possible by proper reward system sector managers have greater value on monetary
for employees working (Lavy, 2007). General Job and non-monetary rewards than public sector
satisfaction of manufacturing employees executives, though public sector executives are
appears to be influenced by the satisfaction with more job safety. Correspondingly, Schuster
job features and individual life, and the degree (1974) concluded in their research that
of satisfaction seems to depend on the executives in public organizations value job
satisfaction with the number of job features as safety more than their counterparts employed
well as their professed importance (Khaleque & by the private businesses and administrations.
Rahman, 1987). Griffin, Hogan, Lambert, Both the studies clearly designate that public
Tucker-Gail, and Baker (2010) in an age in which sector employees give ample value to job safety.
increasing costs, decrease budgets, and So, higher score for public sector personnel is
employee‟s scarcities are common, it is not a role indication of satisfaction from salary

8
The Journal of Commerce, Vol. 3, No. 4,
ISSN: 2218-8118, 2220-6043
Hailey College of Commerce, University of the Punjab, PAKISTAN
rather this exposes a psychological feeling of Böckerman, P., & Ilmakunnas, P. (2006). Do job
employees which is directly connected to job disamenities raise wages or ruin job
safety feeling of employees. There might several satisfaction? International Journal of
other reasons behind it in Pakistani context, Manpower, 27(3), 290-302.
such as inflation in the country, economic Boselie, P., Paauwe, J., & Jansen, P. (2001).
conditions and foreign investment in the Human resource management and
country. performance: lessons from the
Netherlands. International Journal of
LIMITATIONS OF THE STUDY Human Resource Management, 12(7), 1107-
1125.
Although the findings of this study Cacioppe, R., & Mock, P. (1984). A comparison
confirmed the research hypotheses and these of the quality of work experience in
findings have both theoretical and practical government and private organizations.
implications in field of research, but there are Human Relations, 37(11), 923-935.
also some methodological limitations. Although Cammann, C., Fichman, M. J., & Jenkins, D. D.,
present study opens new horizons of research & Klesh, J.(1979). The Michigan
but this study is limited in its scope, variables of Organizational Assessment
study and the nature of relationship among Questionnaire. Unpublished manuscript,
them. First, the study was cross sectional and University of Michigan, Ann Arbor.
conceptual model does not allow for conclusions Carraher, S. M., Carraher, S. C., & Whitely, W.
to be drawn on causal inference Firstly, the (2003). Global entrepreneurship, income,
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numerous implications but the sample size was methodological considerations, and new
too small for drawing some generalized directions. Academy of Management Review,
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as transportation, manufacturing & productions statistical method for measuring how life
etc. can be discussed and will provide useful events affect happiness. International
results for the economy of a country. The salary Journal of Epidemiology, 31(6), 1139-1148.
satisfaction can be measured by longitudinal Cummins, R. A. (2002). Proxy responding for
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The Journal of Commerce, Vol. 3, No. 4,
ISSN: 2218-8118, 2220-6043
Hailey College of Commerce, University of the Punjab, PAKISTAN
Pritchard, R. D. (1969). Equity theory: A review a Public and a Private Organization.
and critique. Organizational Behavior and European Journal of Social Sciences, 18(3),
Human Performance, 4(2), 176-211. 450-461.
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Rubery, J. (1995). Performance related pay and 247-261.
the prospects for gender pay equity. Sudha, G. (2011). Influence of Organisational
Journal of Management Studies, 32(5), 637- Culture and Job Involvement on
654. Organisational Commitment. Journal of
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Sharma, J. P., & Bajpai, N. (2011). Salary TCN/AACN 2005 salary survey:
Satisfaction as an Antecedent of Job professional practices, beliefs, and
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Model to Determine the Linearity between Clinical Neuropsychologist, 20(3), 325-364.
Salary Satisfaction and Job Satisfaction in

Figure 1: Hypothesized model of Salary Satisfaction and Job Satisfaction

Employees are positively affected

Pay schemes based on incentives

Believes in pay-for-performance
All in all, I’m satisfied with
my job
Pay system is based on equity and
justice

Salary Job In general, I like my job

Pay system is based on seniority
Satisfaction Satisfaction
Job utility depends on the level of pay
In general, I don’t like
my job
Feel secured about their job dimension

Healthy working condition

Pay system is based on qualifications

Pay system related to its size and

background

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 Exploring the relationship between salary satisfaction and job satisfaction

Table-1 Z-Test: Two Sample for Means (Salary Satisfaction)

Salary Satisfaction- Salary satisfaction-

public private
Mean 28.317 26.25
Known Variance 15.346 19.063
Observations 160 160
Hypothesized Mean Difference 0
Z 2.745
P(Z<=z) two-tail 0.006
z Critical two-tail 1.959

Table 2 (a, b & c) Regression Results for Public Sector Organizations

Table-2(a)

Regression Statistics Model Summary

Adjusted R Std. Error of

Model R R Square Square the Estimate
1 .761a .578 .576 .47198

a. Predictors: (Constant), SS-Public

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The Journal of Commerce, Vol. 3, No. 4,
ISSN: 2218-8118, 2220-6043
Hailey College of Commerce, University of the Punjab, PAKISTAN

Regression Statistics Model Summary

Adjusted R Std. Error of

Model R R Square Square the Estimate
1 .761a .578 .576 .47198

Table-2(b)

Coefficients
Standardized
Unstandardized Coefficients Coefficients
Model B Std. Error Beta T Sig.
1 (Constant) 1.048 .185 5.661 .000
SS-Public .698 .047 .761 14.723 .000
a. Dependent Variable: JS-Public

Table-2(c)
Significance
Sum of
Model Squares Df Mean Square F Sig.
1 Regression 48.287 1 48.287 216.758 .000a
Residual 35.197 158 .223
Total 83.484 159
a. Predictors: (Constant), SS-Public
b. Dependent Variable: JS-Public

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 Exploring the relationship between salary satisfaction and job satisfaction

Table 3 (a, b & c) Regression Results for Private Sector Organizations

Table -3(a)

Regression Statistics Summary

Adjusted R Std. Error of
Model R R Square Square the Estimate
1 .483a .234 .229 .59617
a. Predictors: (Constant), SS-Private

Table-3(b)

Coefficients
Standardized
Unstandardized Coefficients Coefficients
Model B Std. Error Beta T Sig.
1 (Constant) 2.438 .234 10.426 .000
SS-Private .416 .060 .483 6.942 .000
a. Dependent Variable: JS-Private

Table-3(c)

Significance
Sum of
Model Squares Df Mean Square F Sig.
1 Regression 17.130 1 17.130 48.197 .000a
Residual 56.156 158 .355
Total 73.286 159
a. Predictors: (Constant), SS-Private
b. Dependent Variable: JS-Private

14