Abstract
AbstractThis study examines the relationship between employee job satisfaction and firm performance in a sample of Danish private sector firms. The study relies on a representative survey merged with administrative data and accounting information for a sample of 1,929 Danish firms representing all economic sectors. The results of this study suggest that the average job satisfaction on the firm level positively affects the firms' pre‐tax earnings. The effect amounts to a 7.9% increase per point increase in job satisfaction when job satisfaction is measured on a scale from 0 to 10. Furthermore, the study finds that workers' satisfaction with achievements at the job and their satisfaction with management are specifically related to better performance.
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