High performance work organizations and job rewards in manufacturing and service economies

Abstract

High performance work organizations (HPWOs) and their consequences in the workplace have gained a notable status in sociology and psychology of the workplace during the last three decades in the US and in the other industrialized nations. One area in which the ongoing debates and evidence are inconclusive is the job rewards associated with HPWOs in the manufacturing and service economies. Analysing functional and numerical flexibilities (the ‘internalization’ and ‘externalization’ strategies) adopted in the manufacturing and service sectors, this study intends to extend our understanding of associations between workplace restructuring (HPWOs) and job rewards. The findings reveal that ‘internalized’ or standard employees have gained from internalization strategy with no significant differences between the two economic sectors. However, significant differences are disclosed when the consequences of externalization are contrasted between the sectors. The externalization strategy has significantly undermined job rewards for non-standard workers, except for independent contractors, especially in the manufacturing sector. The article ends with a short discussion on the theoretical significance of the findings and their policy implications in human sources management.

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