Effects of Skill and Attitudes on Employee Performance and Earnings

Abstract

This study uses original survey and archival data from factory and office employees in one firm to relate differences among individual employees' performance to differences in their skill and attitudes about work, and to test the association between employees' earnings and their performance, skill, and attitudes. We suggest that the way in which skill and attitudes affect performance will depend on the type of work that is done. The main results show that among factory employees, those who have on‐the‐job training and longer experience receive better performance ratings than those without training and with less experience. Factory employees' earnings depend on their performance, following the human capital model of wage determination. Among office workers, training and experience do not significantly affect performance ratings; instead, higher‐rated employees have more positive attitudes about work. Office employees' earnings depend on their classroom training, experience, and attitudes, but not on their rated performance.

Effects of positive attitude on happiness and wage: Evidence from the US data

“…affect the worker's earnings positively (Goldsmith, Veum, & Darity, 1997;Groves, 2005;Heckman, Stixrud, & Urzua, 2006;Mohanty, 2009;Mueller & Plug, 2006;Nollen & Gaertner, 1991;Nyhus & Pons, 2005;Salgado, 1997;Waddell, 2006). Interestingly, these psychological variables in most studies not only assume statistically significant positive coefficients, but also have predictive powers higher than those of the standard human capital variables (Goldsmith et al, 1997;Mohanty, 2009;Nyhus & Pons, 2005), indicating the importance of these variables in the estimation of wage equations.…”

Rewards and organizational commitment across structural characteristics: A meta-analysis

“…In public organizations, however, OC will be affected by other variables such as personal values, working conditions, and job characteristics. Some indi-rect support for this line of reasoning comes from research which reports that public organizations tend to pay higher wages than their private counterparts (e.g., Hundley, 1991;Moulton, 1990) although attitudes are not necessarily more positive than in private firms (e.g., NoUen & Gaertner, 1991). Thus, the moderating effect of rewards (extrinsic and intrinsic) on the OC outcome should be significant, and suggests the testing of the following hj^jothe …”

What determines happiness? Income or attitude: Evidence from the U.S. longitudinal data.

“…In fact, both these conceptsutility and happiness-are often used synonymously by economists even today (Easterlin, 2001;Ng, 1997;Oswald, 1997). Frey and Stutzer (2002) aptly remark, "Happiness research in economics takes reported subjective well-being as a proxy measure for utility," and consequently happiness research in economics was almost nonexistent until the last quarter of the 20th century.…”