http://tesdo.org/journal_detail.php?

p_journal_id=3&month=01&year=2014&expand_year=2014

International Journal of Economics and Empirical Research

http://www.tesdo.org/Publication.aspx

Determinants of Job Satisfaction: A Comparative Study in the Banking Sector of Bangladesh

Md. Tapan Mahmud a , Mohammad Tariq Hasan b, Abu Sadat Muhammad Ashif c
a

Bangladesh University of Professionals, Bangladesh

United International University, Bangladesh
c
East-West University, Bangladesh
b

Highlights
The job satisfaction model is investigated in Bangladesh.
Compensation has been considered as the major factor for job satisfaction
Job satisfaction is an attitude of an employee over a period of his job.
Abstract
Purpose: The aim of this paper is to study the various factors of job satisfaction among different commercial
bankers in Bangladesh and to highlight the findings by performing statistical techniques like correlation to
gauge level of significance of the factors in question. Compensation has been considered as the major factor for
job satisfaction. However, other related factors such as promotion, recognition, job involvement and
commitment are also taken into account. Methodology: Employees from National Bank, Bank Asia and
Standard Chartered Bank were taken as the subjects of this study. Job satisfaction is an attitude of an employee
over a period of his job. Hence, the factors of satisfaction and dissatisfaction changes over the period. It is a
relative term and is nowadays used as a key factor to gauge the performance of a particular employee and
organization. Findings: Satisfied employees are more likely to be friendly and responsive which attracts
customers. Dissatisfied employees can lead to customer dissatisfaction. Recommendations: This study opens up
new insights to handle the issue of job satisfaction in Bangladesh.

Keywords: Job satisfaction, Compensation, Employees

JEL Classification: M12, M50, M51, M52

Corresponding Author: mahmudtapan@gmail.com

Citation: Mahmud, M. T., Hasan, M. T. and Asif, A. S. M. (2014). Determinants of Job Satisfaction: A Comparative
Study in the Banking Sector of Bangladesh. International Journal of Economics and Empirical Research. 2(1), 2228.

- 22 -

International Journal of Economics and Empirical Research. 2014, 2(1), 22-28.

I. Introduction
Job satisfaction is an attitude of an employee over a period of his/her job. As a result, the factors of job satisfaction
and dissatisfaction change over the period of time. However, in todays business scenario, that contains continuous
changes and uncertainty, one of the important factors of job satisfaction can be compensation. Job satisfaction is
an attitude and measuring attitudes at workplace is not an easy task. The service sector in Bangladeshs economy has
started to grow recently and among the financial market banking sector is one of the most growing service sectors in
Bangladesh. Job satisfaction is a key instrument to gauge the organizational health, since quality of the service
largely depends upon the human resources (Crossman and Abou-Zaki, 2003). Job Satisfaction is the buzz word in
todays corporate era. In Bangladesh, a decade ago, this concept was not practiced or applied and the employees
were very loyal to their organizations as they tend to start and end their career in the same organizations. Apart from
the bread and butter the organization used to act as their sanctuary and no one was that much concerned about the
job itself or about job satisfaction. Over the period of time, employees have witnessed several eras in modern
business history and the concept of treating humans as assets of the organization has flourished, eventually, which
has done wonders around the world in terms of the growth of companies. The concept of job satisfaction has
emerged having several variables, categorized primarily into monetary and non-monetary lines. Job satisfaction is
the favorableness or un-favorableness with which employees view their work and it is affected by both the internal
and external environment of the organization. Job design affect the job satisfaction, as jobs that are rich in
behavioral elementssuch as variety autonomy, task unimportance and feedbackcontribute to employees
satisfaction. Similarly, the employees acceptance by the work group is important to job satisfaction. To sum up,
each element of the organization environment and system can contribute to or detract from job satisfaction (Werther
and Daris, 2000).
Locke, (1976) defined job satisfaction as a pleasurable or positive emotional state, resulting from the appraisal of
ones job experiences. In general, therefore, job satisfaction refers to an individuals positive emotional reactions to
a particular job. It is an affective reaction to a job that results from the persons comparison of actual outcomes with
those that are desired, anticipated, or deserved (Opkara, 2002). Job satisfaction has significance towards human
healthboth physical and mentaland is positively or negatively correlated. Employees spend a major part of their
lives at the workplace; hence the factors related to job satisfaction and employee behavior along with their
implications are important to measure (Oshagbemi, 1999). In Bangladesh, the concept of HR is also flourishing day
by day and employers as well as the employees are also becoming conscious about their rights and demands. Jobs
satisfaction is a key factor in todays job market especially when the industry is somewhat stagnant. The financial
market, specifically the banking industry of Bangladesh, has boomed in the last few years. There has been a cut
throat competition in the banking sector in Bangladesh, which is an aftermath of both foreign and local investment.
The influential institutions have changed the gaming rules and adapted new modern techniques for their customers.
This has led to a major shift in the working skills that are required or expected for the job. The employees also have
switched a lot of jobs for better prospects, higher salary, compensation and various other factors. Along with the
quantitative aspects of rewards the qualitative aspects also remain important.
Over the years, the market has seen immense opportunities in this sector and a lot of influential institutions have
joined in. The paradigm of the banking sector changed with the emergence of plastic money and online transfers.
Thus, the technological breakthroughs affected the banking sector and numerous career opportunities were created,
in all disciplines. The paradigm shifted from a financial sector to a service sector, where providing quality service to
the customer became the ultimate goal of the bank. Due to heavy inflow of multinational banks in Bangladesh, a
new culture in the banking sector emerged pillared on performance based rewards and compensations. This
emergence brought higher employment opportunities, upward trend in income level and changes in consumption
pattern which consequently triggered more competition in the industry.
I.I Objective of the Study
The prime objective of the study is to identify and measure the various factors of job satisfaction encompassing
several commercial bankers in Bangladesh and to highlight the key findings by performing statistical techniques, to
judge the correlation and level of significance of the factors. Primarily, compensation has been considered as one of
the major factors for job satisfaction. However, other related factorssuch as, promotion, work efforts and the
importance/challenge of the jobare also being taken into account.

- 23 -

Determinants of Job Satisfaction: A Comparative Study in the Banking Sector of Bangladesh

II. Literature Review
The concept of job satisfaction remains as one of the densely studied area of business studies; mostly, the factors
affecting the said concept were frequently questioned. Locke, (1976) estimated that, as of 1976, about 3,350 articles
or dissertations had been written on the topic. Cranny et al. (1992) indicated that more than 5,000 studies of job
satisfaction have been published. In a more recent estimate, Oshagbemi (1996) suggested that, if a full count of
relevant articles and dissertations were made, Lockes estimate, which was made only 20 years earlier, would have
been doubled. As a result of many decades of research effort, there appears to be a high level of agreement among
scholars on the meaning of job satisfaction. Typically, job satisfaction is conceptualized as a general attitude toward
an object, the job. Locke, (1976) defined job satisfaction as a pleasurable or positive emotional state, resulting from
the appraisal of ones job experiences. There are, of course, a few but largely unimportant differences to general
conceptualization; Wanous and Lawler, (1972) discussed these variations. Job satisfaction involves several different
spheres such as satisfaction with compensation, promotion opportunities, fringe benefits, job security and the
importance/challenge of the job (Nguyen, Taylor and Bradley, 2003). Job satisfaction has often been linked to
organizational commitment, turnover intentions, and absenteeism. These variables are costly to an organization, as
they could lead to low morale, poor performance, lower productivity, and higher costs of hiring, retention, and
training (Opkara, 2002). The banks, specifically the private ones, created a cut throat competition by launching fresh
products and services regularly, to gain additional market share. The employment patterns in the banking sector
altered abruptly, which converted it into a highly volatile market for job seekers. The salary bands along with
compensation and rewards patterns changed; moreover, the focus shifted to performance and targets from
experience and loyalty. Hence, compensation and job satisfaction became a key factor for the banking professionals
which needed attention so as to achieve the long term goals of the bank (Islam and Saha). Studies have tested the
hypothesis that income is an important determinant of job satisfaction (Nguyen, Taylor and Bradley, 2003). Factors
such as compensation, the work itself, supervision, relationships with co-workers and opportunities for promotions
have been found to contribute to job satisfaction (Opkara, 2002). There is a significant difference in the job
satisfaction levels of employees based on their income. Employees earning the lowest income report significantly
lower levels of job satisfaction relative to the other income groups. Highly paid employees may still be dissatisfied,
if they do not like the nature of their job and feel that they have an opportunity to enter into a more satisfying job
(Luddy, 2005). Zeitz, (1990) found that perceptions that employees have about numerous aspects of their work
environment (management climate, job content, reward fairness, employee influence on work group, and promotion
opportunities) shape their concept about job satisfaction. Personal characteristics such as age, gender, education
level, and pay grade did not contribute incrementally to explain the variance in work satisfaction; rather work
satisfaction is explained by variables describing the job situation. Reiner and Zhao, (1999) examined two sources of
job satisfaction: demographic characteristics (age, race, gender, educational level) and work environment
characteristics (task identity, autonomy, skill variety, task significance, feedback).
Along with quantitative method, job satisfaction can also be investigated by qualitative approach. A qualitative
study (Bussing et al. 1999) suggested that job satisfaction is developed through assessment of the match between
expectations, needs, and motives and the work situation. Based on this assessment, a person builds up satisfaction
(steady feeling of relaxation as a result of met expectations and needs) or dissatisfaction (feeling of tension as a
result of unsatisfied needs and expectations) with his work. In case of dissatisfaction, employees may maintain or
reduce their level of aspiration. Maintaining aspirations in the face of work dissatisfaction can result in pseudo work
satisfaction, fixated dissatisfaction and constructive dissatisfaction. Fixated and constructive work dissatisfaction
may result in mobilization of an employees problem-solving behavior (Bussing et al. 1999). Major and Konar,
(1986) argued that, through the socialization process, men and women develop different attitudes toward
occupational achievement and work contentment which often lead to systematic inter-gender variations in
perceptions and behavior. Weaver, (1980) found a positive association between job satisfaction and education, age,
income, and occupation. In general, therefore, job satisfaction refers to an individuals positive emotional reactions
to a particular job. It is an affective reaction to a job that results from the persons comparison of actual outcomes
with those that are desired, anticipated, or deserved.
III. Research Problem
The key research problem in this study is; whether compensation is the major factor for determining job satisfaction
among Bangladeshi bankers. Compensation does not just include the salary that an individual is getting from his /
her job; rather compensation includes all benefits including the short term and long term fringe benefits. Banking
industry has grown recently in Bangladesh and a lot of people are associated with this industry. The study would not
have been meaningful, if the focus was only on the employees of a single bank or on the employees of banks chosen

- 24 -

International Journal of Economics and Empirical Research. 2014, 2(1), 22-28.

on a random basis. An endeavor has been made to conduct a comparative analysis of employees of the three
different leading commercial banks in Bangladesh. This comparative analysis highlights the level and determinants
of job satisfaction of employees in these banks.
IV. Research Methodology and Theoretical Framework
The research aims at identifying and measuring the determinants of job satisfaction among various commercial
bankers in Bangladesh. Satisfaction related to Compensation, has been considered as the major factor for job
satisfaction. However, other related factors like promotion, fringe benefits, work efforts and the
challenge/opportunity of the job are also taken into account (Nguyen, Taylor and Bradley, 2003).
Dependent Variable:
According to the study by Islam and Saha, job satisfaction is the major dependent variable which depends upon
various dependent variables for its lateral movement. Overall Job Satisfaction has been identified as the dependent
variable in the study.
Independent Variable:
Independent variables used in the study are: Satisfaction with compensation, satisfaction with promotion,
recognition, work opportunity, self expression, management support, job involvement and organizational
commitment. McCook, (2002) identified these independent variables as major determinants of job satisfaction and
job involvement is a psychological affiliation of a person with his /her job. Job involvement signifies that the
individuals who are highly involved in their jobs show positive results. Satisfaction with compensation and
promotion represents positive or negative correlation as to the extent, the employee is happy with the amount of
salary he/she receives and the number of fair promotional opportunities he/she gets in the job. Organizational
commitment shows that the employee is willing to stay in the organization for the rest of his/her career and owns the
problems faced by the organization as his own. Work opportunities denote the scope and time commitment required
for achieving a higher performance level. Recognition is the appreciation given by the management for the vital;
contribution made by the employees. Management support is there when an employee has good relations with the
management and enjoys assistance from them by dint of employee friendly policies. Self expression on the job is the
depiction of ones true feelings regarding the job & organization that a person is free to express. All these factors
contribute towards the job satisfaction and are measured independently.
IV.1 Network of Association
A formal theoretical framework is designed on the basis of literature review and the dependent and independent
variables. A framework is the key component of a social research and highlights the graphical representation of the
hypothetical model developed and followed in a research.
IV.II Hypothesis Development
On the basis of association between independent and dependent variables, the following hypotheses are developed:
H0: Compensation, recognition, promotion, Management support, job involvement, organizational commitment,
work opportunity and self expression positively influence employees overall job satisfaction.
Ha: There is significant difference among the determinants on employees job satisfaction with compensation.
IV.III Sampling and Data Collection
Sampling used in this research is convenience sampling. Three leading commercial banks in Bangladesh were
targeted. The target audience was officer level bankers working as executives. The study involves bankers of all age
groups and career levels, thus minimizing tunnel conclusion. Three commercial banks, namely, Standard Chartered
Bank, Bank Asia Limited and National Bank Limited were targeted1. A tested questionnaire has been used with a
number of variables related to job satisfaction (McCook, 2002). A total of 80 questionnaires were distributed out of
which 40 questionnaires were filled by the respondents, which is a successful ratio in social research.

Three banks were selected from three segments, so that the samples become representative of the population. Bank Asia is representing the first
generation banks of Bangladesh, National Bank is representing the second generation and finally, Standard Chartered Bank is representing the
foreign commercial banks of Bangladesh.

- 25 -

Determinants of Job Satisfaction: A Comparative Study in the Banking Sector of Bangladesh

Figure-1: Hypothetical Framework
Independent Variable

Dependent Variable

Compensation
Recognition
Promotion
Management Support

Overall Job
Satisfaction

Job Involvement
Organizational Commitment
Work opportunity
Self Expression
The major problems faced during the data collection procedure were mostly peoples disinclination to communicate.
Moreover, employees were reluctant to disclose the real fact as their supervisors may know and harm them in future.
Nonetheless, after realizing that research ethics is being maintained in this study, they agreed to give as much
information as they could.
V. Data Analysis Procedures
Data analysis in a quantitative research is essential as the interpretation and coding of responses can be very critical.
The analysis part has been dealt with using MINITAB. The questions and responses were coded and entered in
MINITAB for analysis followed by the interpretation of the results. The variables were coded in MINITAB and
certain statistical methods were applied on the data. In the first instance, the reliability of the tool was measured and
then mean comparisons were used to determine whether compensation is the major factor of job satisfaction among
various commercial bankers or not.
V.I Analysis and Findings
Reliability analysis to conclude about the credibility of the research procedure and to test the said association among
different variables, correlation analysis is being done.
V.II Reliability Analysis
SPSS was utilized to find out the reliability of the instrument used for data collection. Cronbachs alpha is the most
common form of internal consistency reliability coefficient. The value of alpha should stay between 0 and 1.
Table-1: Reliability Statistics
Cronbachs alpha
Number of Items
0.72
8
The results show in Table-1 show that for the number of variables the value of Cronbachs Alpha is 0.72. By
convention, a lenient cut-off point of at least .70 or higher is required to hold an item in an adequate scale; and

- 26 -

International Journal of Economics and Empirical Research. 2014, 2(1), 22-28.

many researchers require a cut-off point of .80 for a good scale in social research. The value 0.72 shows that the
variables measure the concepts of the tool acceptably. The tested tool is therefore reliable.
V.III Correlation Analysis
Correlation is a statistical tool which can determine the strength and direction of relationship between two variables.
The value of correlation ranges between +1 to -1. From the said range, positive one denotes extreme similar way
movement, while, the other measure points towards an extreme contra way movement. If the value turns out to be
0, it denotes no relationship. Table-2 shows the correlation between job involvement, compensation, promotion,
self expression and overall job satisfaction. The value of correlation coefficient for job involvement, promotion with
overall satisfaction is 0.324 and 0.272 simultaneously, which shows a weak to moderate but positive relationship of
both variables with overall job satisfaction. This relationship is significant at a 0.01. The Table-2 shows that job
involvement and compensation (.466 at a 0.01) are significantly associated. Other significant associations are found
between job involvement and promotion, compensation and promotion. Considerable sample size, N = 40 for the
study.
Table-3 shows the correlation between Organizational Commitment, Work opportunity, Recognition, Management
support and Overall job satisfaction. The value of correlation coefficient for recognition is 0.362, which shows a
weak to moderate but positive relationship with job satisfaction among the four variables. This relationship is
significant at a 0.01. The table shows that work effort and organizational commitment (.679 at a 0.01) are
significantly associated. Other significant associations are found between recognition and supportive management.

Variables

Instrument

Compensation

Pearson Correlation
Sig. (2-tailed)
Pearson Correlation
Sig. (2-tailed)
Pearson Correlation
Sig. (2-tailed)
Pearson Correlation
Sig. (2-tailed)
Pearson Correlation
Sig. (2-tailed)

Job
involvement
Promotion
Self
expression
Overall job
satisfaction

Variables

Instrument

Organizational
commitment
Work
opportunity
Management
support
Recognition

Pearson Correlation
Sig. (2-tailed)
Pearson Correlation
Sig. (2-tailed)
Pearson Correlation
Sig. (2-tailed)
Pearson Correlation
Sig. (2-tailed)
Pearson Correlation
Sig. (2-tailed)

Overall job
satisfaction

Table-2: Correlations Analysis

Job
Compensation
Promotion
involvement
1
0.466*
0.488*
0.000
0.000
0.466*
1
0.519*
0.000
0.000
0.488*
0.519*
1
0.000
0.000
0.052
0.154
-0.075
0.668
0.202
0.538
-0.096
0.324*
0.272**
0.431
0.006
0.023
Table-3: Correlations Analysis
Organizational Work
Management
commitment
opportunity support
1
0.679**
0.028
0.000
0.816
0.679**
1
0.129
0.000
0.289
0.028
0.129
1
0.816
0.289
-0.086
0.045
0.474**
0.481
0.709
0.000
-0.107
0.107
-0.001
0.376
0.378
0.992

Self
expression
0.052
0.668
0.154
.202
-0.075
0.538
1
-0.227
0.059

Overall job
satisfaction
-0.096
0.431
.0324*
0.006
0.272**
0.023
-0.227
0.059
1

Recognition
-0.086
0.481
0.045
.709
0.474**
0.000
1
0.362
0.002

Overall job
satisfaction
-0.107
0.376
0.107
0.378
-0.001
0.992
-0.362**
0.002
1

*Correlation is significant at 0.05 level, ** Correlation is significant at 0.01 level

VI. Concluding Remarks

The aim of this paper was to estimate the extent to which a banker's job satisfaction is determined by different
variables mentioned above. Job satisfaction of bank officers is significantly dependent upon compensation,
promotion opportunities, rewards, relation with boss and coworkers. It is evident from the correlation table that,
though compensation is the main vibrator of job satisfaction, it has significant relationships with job involvement

- 27 -

Determinants of Job Satisfaction: A Comparative Study in the Banking Sector of Bangladesh

and promotion. There is some evidence that workers who are dissatisfied with their bosses are more sensitive to their
compensation in deciding on whether they are satisfied with their job. There remain important policy implications
for the management body of the commercial banks in Bangladesh, pursuing the outcome of this study. Changes in
organizational variables, such as compensation scales, employee input in policy development, and work
environment could be made in an effort to increase organizational participation and commitment, which in turn, will
lead to employee commitment and satisfaction. The critical implication is that, the bank management can get a hint
about the appropriate way of variable modification to vibrate job satisfaction of the employees, by following the
outcome of this study.
Reference
Bussing, A., Bissels, T., Fuchs, V. and Perrar, K. M. (1999). A Dynamic Model of Work Satisfaction: Qualitative
Approaches. Human Relations, 52(8), 999-1028.
Cranny, C.J., Smith, P.C. and Stone, E. F. (1992). Job Satisfaction: How People Feel About Their Jobs and How It
Affects Their Performance. New York: Lexington Books.
Crossman, A. and Abou-Zaki, B. (2003). Job Satisfaction and Employee Performance of Lebanese Banking Staff.
Journal of Managerial Psychology, 18(4), 368-376.
Islam, N. U. and Saha, G. C. (2006). Job Satisfaction of Bank Officers in Bangladesh. Journal of Managerial
Psychology, 21(3), 62-74.
Locke, E.A. (1976). The Nature and Causes of Job Satisfaction. in Dunnette, M.D. (ed.), Handbook of Industrial and
Organizational Psychology, pp 1297-1343, Chicago, Rand McNally.
Major, B. and Konar, E. (1986). An Investigation of Sex Differences in Pay Expectations and their Possible Causes.
Academy of Management Journal, 27(4), 277-292.
McCook, K. D. (2002). Organizational Perceptions and Their Relationships to Job Attitudes, Effort, Performance
and Organizational Citizenship Behaviors. Dissertation (PHD), Louisiana State University.
Nguyen, A. N., Taylor, J. and Bradley, S. (2003). Relative Compensation and Job Satisfaction: Some new Evidence.
http://mpra.ub.uni-muenchen.de/1382, August 04, 2011, 10:00 am.
Opkara, J. O. (2002). The Impact of Salary Differential on Managerial Job Satisfaction: A Study of the Gender Gap
and its Implications for Management Education and Practice in a Developing Economy. The Journal of
Business in Developing Nations, 8, 65-92.
Oshagbemi, T. (1996). Job Satisfaction of UK Academics. Educational Management and Administration, 24(4),
389-400.
Oshagbemi, T. (1999). Overall Job Satisfaction: How Good are Single versus Multiple-item Measures? Journal of
Managerial Psychology, 14(4), 388-403.
Reiner, M.D. and Zhao, J. (1999). The Determinants of Job Satisfaction among United States Air Force Police.
Review of Public Personnel Administration, 19(3), 5-18.
Wanous, J. P. and Lawler, E. D. (1972). Measurement and Meaning of Job Satisfaction. Journal of Applied
Psychology, 56(2), 95-105.
Weaver, C. N. (1980). Job Satisfaction in the United States in the 1970s. Journal of Applied Psychology, 55(3), 364367.
Werther, W. B. and Daris, J. K. (2000). Human Resources and Personnel Management. USA: McGraw-Hill-Inc.
Zeitz, C. (1990). Age and Work Satisfaction in a Government Agency: a Situational Perspective. Human Relations,
43(5), 419-438.

- 28 -