Demographic factors, compensation, job satisfaction and organizational commitment in private university: an analysis using SEM

Abstract

PurposeThe purpose of this paper is to examine the direct and indirect effects of demographic factors on employee compensation, job satisfaction and organizational commitment in private higher educational institutes in Bangladesh. Specifically, how do compensation structure and job satisfaction mediate in the link between demographic factors and organizational commitment? To answer this question, a theoretical framework using the theory of employee retention provided by Martin and Kaufman, as its basis was established.Design/methodology/approachData (n = 515) were collected from faculty members of the private universities in Bangladesh. Structural equation modeling was used to analyze the data.FindingsFindings indicate that though demographic factors have no direct impact on organizational commitment, they have indirect impacts on organizational commitment through the mediation of compensation structure and faculty job satisfaction. Besides, compensation structure also has a significant mediating role in the link between demographic structure and faculty job satisfaction.Research limitations/implicationsOne possible drawback is the number of private universities from which the data were collected. In the sample used here, only 20 private universities were selected to conduct the survey. Besides, the study could not include public universities that are also a significant part and parcel of higher education in the country. So, if more private and public universities were taken into consideration to collect the data, the results might be improved. Thus, the usual cautions about overgeneralizing findings from this sample, to populations for which it is not strictly representative, apply.Practical implicationsFrom a practical perspective, as a cumulative body of work on organizational commitment, we will be better able to advise policymakers and educators on the elements they need to address to increase the longer engagement of the faculty members in their institutes. In this study, the one area of findings that may help policymakers and educators the most concerns compensation package that affects job satisfaction and organizational commitment. We found that demographic factors and compensation packages are the most important factors for the faculty members to impact on organizational commitment in this study.Social implicationsThe social implication is that policymakers of the private universities can focus on fair justice in terms of demographic factors and compensation package for job satisfaction, motivation and organizational commitment of the faculty members in their universities.Originality/valueThe findings of the study are important for the policymakers of the higher education institutes.