The mediating role of job satisfaction on compensation, work environment, and employee performance: Evidence from Indonesia

Idris Idris (), Khofifatu Rohmah Adi (), Budi Eko Soetjipto () and Achmad Sani Supriyanto ()
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Idris Idris: State University of Malang, Indonesia
Khofifatu Rohmah Adi: State University of Malang, Indonesia
Budi Eko Soetjipto: State University of Malang, Indonesia
Achmad Sani Supriyanto: Maulana Malik Ibrahim State Islamic University, Indonesia

Entrepreneurship and Sustainability Issues, 2020, vol. 8, issue 2, 735-750

Abstract: Job satisfaction has a pivotal role in improving employee performance. It provides enthusiasm and high motivation to employees to increase productivity. On the other hand, to improve employee performance, the organization provides compensation based on established standards and in an environment that is, sometimes, less conducive. This study purposes to examine the mediating role of job satisfaction on compensation, work environment, and employee performance at State Polytechnic colleges in Indonesia. This study used Partial Least Square (PLS) as data analysis. This study found that compensation has no impact on job satisfaction and employee performance. In addition, job satisfaction cannot mediate the compensation and employee performance. However, the work environment positively and significantly affects job satisfaction and employee performance. Job satisfaction has impact on work environment and employee performance. It also influences employee performance positively and significantly. Thus, job satisfaction directly or indirectly can be a mediator for the relationship between work environment and employee performance.

Keywords: job satisfaction; compensation; work environment; employee performance; state polytechnic colleges (search for similar items in EconPapers)
JEL-codes: M10 O15 (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:ssi:jouesi:v:8:y:2020:i:2:p:735-750

DOI: 10.9770/jesi.2020.8.2(44)

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