The Relationship Between Employee Satisfaction and the Financial Health of Kansas Independent Colleges and Universities

Abstract

Higher education serves as one of the fundamental societal mechanisms to advance knowledge and prepare individuals to think critically, act responsibly, and participate in the U.S. labor force in productive ways. Researchers have suggested that employee satisfaction is one of the factors that can contribute to the financial success of an organization (Carnegie, 2012; Gallup, 2013; Harvard Business Review Analytic Services, 2013). Understanding the existence and strength of the relationship between employee satisfaction and institutional financial health within private, nonprofit higher education institutions assists those entities in managing organizational outcomes and strengthening their position within the competitive educational environment. The purpose of the current study was to identify whether there is a difference in employee satisfaction as reported on the Abridged Job Descriptive Index (aJDI) and Abridged Job in General Scale (aJIG) among five Kansas private, nonprofit higher education institutions with varying levels of financial health as measured by a revised Higher Learning Commission Composite Financial Index (CFI). Institutions in the current study were classified as Low CFI [-1.0 to .9], Middle CFI [1.0 to 1.7], or High CFI [1.8 to 3.0]. The level of employee satisfaction at each institution was determined by an online survey (N = 334) using the aJDI which measures five distinct facet scores (People on Your Present Job, Work on Present Job, Pay, Opportunities for Promotion, and Supervision), and the overall level of employee satisfaction at the same institutions using the aJIG. Of the five specific job facets measured by the aJDI and overall satisfaction as measured by the aJIG scores, only the mean score for Opportunities for Promotion reflected a difference in employee satisfaction. Employees from institutions in lower CFI categories reflected higher satisfaction on the Opportunities for Promotion facet. Respondents from institutions in all CFI categories reported lower satisfaction with Opportunities for Promotion and Pay than other survey categories. Future research is needed to further explore the relationship between employee satisfaction and financial outcomes at private and public higher educational institutions.