Work climate drivers and employee heterogeneity

Abstract

We examined how sociodemographic variables affect the relationship between work climate constructs (motivation, satisfaction, and loyalty) and work climate drivers (empowerment, image, leadership, pay, and work conditions) in the banking sector. We implemented a partial least squares structural equation model to test the general model and then tested heterogeneity using the multi-group parametric test and Pathmox analysis to determine how employee groups were segmented in the structural model. Our results show that empowerment has the greatest impact on work climate and that not all employees respond in the same way to different work climate drivers. As sources of heterogeneity, we identified three groups of employees, namely, executives, senior employees, and junior employees, finding that leadership is important in defining the loyalty of junior employees, whereas work conditions are crucial for senior employees and executives. While pay is one of the most important corporate tools for attracting, retaining, and motivating younger talent, we found that it becomes less relevant as employees ascend the company hierarchy. Our findings provide interesting insight into how companies might customize human resource management strategies according to different employee profiles.

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