Magazine 2013
International Peer-Reviewed Journal
RH, VOL. 3 JULY 2013
Job Satisfaction In The Banking
Sector-A Comparative Study
Geeta Menezes
ABSTRACT
Job satisfaction is the buzzword in today’s corporate era and a key instrument to gauge the
organizational health as service quality largely depends upon the human resources. After 1991, the
banking scenario has changed completely. The banks need to keep pace with the fast changing global
environment to become globally more competitive. The catalysts for transformation are many, yet it is
the human resource that has to play a key role. This study compares the job satisfaction levels of public
and private sector banks. The differences in public and private sector banks with respect to their
background, employment structure, pay packages, job security, welfare policies, growth opportunities
etc. play a significant role in influencing the job satisfaction levels of these banks. It is hypothesized that
job attitudes of employees working in these two types of banks would differ significantly. A structured
questionnaire covering six dimensions of job satisfaction such as work itself, job security, pay, personal
development and training opportunities, supervision and co-workers was administered to 200 bank
employees from the public sector and 180 bank employees from the private sector. Descriptive statistics
and chi-square tests were used to study the differences in employee attitudes. The result indicates that
the private sector bank employees are less satisfied with their jobs as compared to public sector bank
employees. As banking institutions are the fulcrum of a nation’s economy, higher levels of job satisfaction
through effective management of human resources will contribute not only to sound and efficient banking,
but also to a nation’s prosperity.
Keywords - Job Satisfaction, Public Sector Banks, Private Sector Banks.
Introduction
Job satisfaction is an attitude, which results from a balancing and summation of many specific likes and
dislikes experienced in connection with the job. It is the employees’ judgement of how well the job on the whole
is satisfying his various needs (Ganguli, 1994). Job satisfaction is a key instrument to gauge the organizational
health as service quality largely depends upon the human resources (Crossman and Abou-Zaki, 2003). After
1
991, the banking scenario has changed completely. The banks need to keep pace with the fast changing
global environment to become globally more competitive. The catalysts for transformation are many, yet it is
the human resource that has to play a key role. Public and private sector banks differ with respect to their
working environments, compensation structures, growth opportunities and job security provided to the
employees. Public sector banks structure compensation in such a way that there are lower pay differentials
between employees. Long term tenure is rewarded and, there is a higher base pay. In the private banks, there
are larger pay differentials, fewer rewards for tenure, and individual incentives are high. Public sector banks
place a lot of emphasis on training, whereas in the private banks, training is emphasized according to necessity.
In terms of staffing, the public sector banks are committed to employee security and have a full time work force,
whereas in the private banks, the staffing policy is a hire and fire at will dictated one with a part time work force
(D’Souza, 2002). Since the public and private sector banks differ with respect to their work culture, compensation
structures, job security, etc., these variations are likely to play a significant role in influencing the job satisfaction
levels in these banks.
The objective of the study is to compare the job attitudes between the public sector and private sector
banks. The null hypothesis of the study is that there is no difference in job attitudes between the public and
private sector banks. Bajpai and Srivastava (2004) examined the degree of job satisfaction of two public sector
and two private sector banks in India and revealed that layoff threats, quick turnover, less welfare schemes
increased job dissatisfaction whereas secure environment, welfare policies and job stability increased the degree
of job satisfaction. Purang and Shrivastava (2009) examined the job satisfaction level of a public and private
sector bank employees in India and found that private sector bank employees perceived greater satisfaction
with pay, social and growth aspects of job as compared to public sector bank employees. Islam and Saha
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RH, VOL. 3 JULY 2013
(
n.d.) evaluated job satisfaction of bank officers in Bangladesh and found that private bank officers reported
higher levels of job satisfaction as compared to public sector banks, as they enjoyed better facilities and
supportive work environment. Khalid and Irshad (2010) examined the job satisfaction level among the bank
employees in Punjab, Pakistan and revealed that employees of private banks were more satisfied with pay,
recognition and working hours as compared to public sector bank employees.
Research Methodology
The sample covered 38 banks-20 from the public sector and 18 from the private sector. A structured
questionnaire with a five point rating scale, covering six dimensions of job satisfaction (work itself, job security,
pay, training opportunities, supervision and co-worker behaviour) was administered to 380 bank employees-
2
00 from the public sector and 180 from the private sector. The collected data was cleaned, corroborated and
analyzed using SPSS. Statistical tools used were percentage analysis and chi-square tests. Secondary data
was collected from the official records of RBI and various research papers and journals.
Results And Discussions
Table 1-A compares the attitudinal differences between public and private sector banks with respect to
Question 1: How satisfied are you with the allotment of work in your department? 73.5% of the public sector
employees are satisfied with the allotment of work in their department, whereas 66.1% of the private sector
employees are dissatisfied with the allotment of work in their department. Excess work pressure and multi-
tasking expected from private sector bank employees should explain this difference in response patterns. Since
the p-value for chi-square test is 0.000, there is a significant difference between the two sectors with respect to
work itself component of job satisfaction (Table 1-B).
Table 1-A: Attitudinal differences for Question 1
Type of Organization
Total
Public
7
Private
How satisfied
are you with
the allotment
of work in
Very
Count
% within Type
of Organization
Count
30
37
Dissatisfied
3.5%
16.7%
9.7%
Dissatisfied
7
119
126
your
% within Type
of Organization
Count
3.5%
66.1%
33.2%
department?
Undecided
Satisfied
12
28
40
%
within Type
6.0%
15.6%
10.5%
of Organization
Count
147
3
150
%
within Type
73.5%
1.7%
39.5%
of Organization
Count
Very Satisfied
27
0
27
%
within Type
13.5%
.0%
7.1%
of Organization
Count
Total
200
180
380
%
within Type
100.0%
100.0%
100.0%
of Organization
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Table 1-B: Chi-square Test for Question 1
RH, VOL. 3 JULY 2013
Value
df
4
Asymp. Sig. (2-sided)
.000
Pearson Chi-Square
No. of Valid Cases
285.230
380
Table 2-A compares the attitudinal differences between public and private sector banks with respect to
Question 2: Do you believe that so long as you work efficiently, you will not lose your job? 47.5% of the public
sector bank employees have strongly agreed whereas this percentage is only 2.8 in the private sector. Random
layoffs in the private sector banks and commitment to job security in the public sector banks may be one of the
reasons for this deviation. Since the p-value for chi-square test is 0.000, there is a significant difference between
the two sectors with respect to job security component of job satisfaction (Table 2-B).
Table 2-A: Attitudinal differences for Question 2
Type of Organization
Total
Public
1
Private
Do you
Strongly
Disagree
Count
% within Type
of Organization
Count
32
33
believe that so
long as you
work efficiently
you will not
lose your job?
.5%
17.8%
8.7%
Disagree
Undecided
Agree
2
92
94
% within Type
of Organization
Count
1.0%
51.1%
24.7%
9
46
55
%
within Type
4.5%
25.6%
14.5%
of Organization
Count
93
5
98
%
within Type
46.5%
2.8%
25.8%
of Organization
Count
Strongly Agree
95
5
100
%
within Type
47.5%
2.8%
26.3%
of Organization
Count
Total
200
180
380
%
within Type
of Organization
Table 2-B: Chi-square Test for Question 2
100.0%
100.0%
100.0%
Value
df
Asymp. Sig. (2-sided)
4
Pearson Chi-Square
No. of Valid Cases
299.981
380
.000
Table 3-A compares the two sectors with respect to Question 3: How satisfied are you with your present
salary? 38.5 % of the public sector bank employees are fairly well satisfied with their current salary, whereas this
percentage is only 3.9 in the private sector. Since the private sector bank employees do not have enough job
security, they expect a far better pay package and are therefore dissatisfied with their current salary. Since the
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International Peer-Reviewed Journal
RH, VOL. 3 JULY 2013
p-value for chi-square test is 0.000, there is a significant difference between the two sectors with respect to pay
component of job satisfaction (Table 3-B).
Table 3-A: Attitudinal differences for Question 3
Type of Organization
Total
Public
Private
56
How satisfied
are you with
your present
salary?
Very
Count
% within Type
of Organization
Count
13
69
Dissatisfied
6.5%
31.1%
18.1%
Dissatisfied
43
69
112
%
within Type
21.5%
38.3%
29.5%
of Organization
Count
Neither Satisfied
53
48
101
nor Dissatisfied % within Type
of Organization
26.5%
26.7%
26.6%
Fairly Well
Satisfied
Count
% within Type
of Organization
Count
77
7
84
38.5%
3.9%
22.1%
Completely
Satisfied
14
0
14
% within Type
of Organization
Count
7.0%
.0%
3.7%
Total
200
180
380
%
within Type
of Organization
Table 3-B: Chi-square Test for Question 3
100.0%
100.0%
100.0%
Value
df
Asymp. Sig. (2-sided)
Pearson Chi-Square
No. of Valid Cases
104.651
380
4
.000
Table 4-A compares the two sectors with respect to Question 4: How reasonable is your immediate
supervisor in the work he expects from you? 43% of the public sector bank employees feel that their immediate
supervisor is fairly reasonable whereas this figure is only 8.3% in private sector banks. This could be attributed
to deadlines, target pressures and rigorous evaluations imposed by the immediate supervisor in the private
sector. Since the p-value for chi-square test is 0.000, there is a significant difference between the two sectors
with respect to supervision component of job satisfaction (Table 4-B).
Table 4-A: Attitudinal differences for Question 4
Type of Organization
Total
Public
Private
40
How
Quite
Count
4
44
11.6%
reasonable is Unreasonable % within Type
2.0%
22.2%
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International Peer-Reviewed Journal
RH, VOL. 3 JULY 2013
your
of Organization
Count
immediate
supervisor in
the work he
Not Very
6
59
65
reasonable
% within Type
of Organization
Count
3.0%
32.8%
17.1%
expects from About Average
you?
33
65
98
% within Type
of Organization
Count
16.5%
36.1%
25.8%
Fairly
86
15
101
Reasonable
% within Type
of Organization
Count
43.0%
8.3%
26.6%
Very
71
1
72
Reasonable
% within Type
of Organization
Count
35.5%
.6%
18.9%
Total
200
180
380
%
within Type
of Organization
Table 4-B: Chi-square Test for Question 4
100.0%
100.0%
100.0%
Value
200.588
380
df
4
Asymp. Sig. (2-sided)
.000
Pearson Chi-Square
No. of Valid Cases
Table 5-A compares the two sectors with respect to Question 5: Do you prefer to work with your present
colleagues? 22.5% of the public sector bank employees have responded positively, compared to only 10% of
private sector bank employees. Since the p-value for chi-square test is 0.000, there is a significant difference
between the two sectors with respect to Question 5 (Table 5-B).
Table 5-A: Attitudinal differences for Question 5
Type of Organization
Total
Public
Private
7
Do you prefer
to work with
your present
colleagues?
Strongly
Count
% within Type
of Organization
Count
0
7
Disagreed
.0%
3.9%
1.8%
Disagreed
Uncertain
0
11
11
%
within Type
.0%
6.1%
2.9%
of Organization
Count
18
31
49
%
within Type
9.0%
17.2%
12.9%
of Organization
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RH, VOL. 3 JULY 2013
Agreed
Count
137
113
250
%
within Type
68.5%
62.8%
65.8%
of Organization
Count
Strongly
Agreed
45
18
63
% within Type
of Organization
Count
22.5%
10.0%
16.6%
Total
200
180
380
%
within Type
100.0%
100.0%
100.0%
of Organization
Table 5-B: Chi-square Test for Question 5
Value
34.367
380
df
4
Asymp. Sig. (2-sided)
.000
Pearson Chi-Square
No. of Valid Cases
Table 6-A compares the two sectors with respect to Question 6: How satisfied are you with the personal
development, training and quality improvement programme in this organization? 40.6% of the private sector
bank employees have reported dissatisfaction as compared to only 9% in the public sector. This is because
public sector banks place a lot of emphasis on training, whereas in the private sector, training is emphasized
according to necessity. Since the p-value for chi-square test is 0.000, there is a significant difference between
the two sectors with respect to Question 6 (Table 6-B).
Table 6-A: Attitudinal differences for Question 6
Type of Organization
Total
Public
Private
15
How satisfied Very Dissatisfied
are you with
Count
1
16
% within Type
of Organization
Count
.5%
8.3%
4.2%
the personal
development,
training and
quality
Dissatisfied
Undecided
18
73
91
% within Type
of Organization
Count
9.0%
40.6%
23.9%
improvement
programme
in this
19
15
34
% within Type
of Organization
Count
9.5%
8.3%
8.9%
organization?
Fairly Well
Satisfied
139
73
212
% within Type
of Organization
Count
69.5%
40.6%
55.8%
Completely
Satisfied
23
4
27
% within Type
of Organization
11.5%
2.2%
7.1%
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International Peer-Reviewed Journal
RH, VOL. 3 JULY 2013
Total
Count
200
180
380
%
within Type
100.0%
100.0%
100.0%
of Organization
Table 6-B: Chi-square Test for Question 6
Value
79.046
380
df
4
Asymp. Sig. (2-sided)
.000
Pearson Chi-Square
No. of Valid Cases
Table 7-A compares the two sectors with respect to Question 7: Taking all things into consideration, how
satisfied are you with your service here? More of public sector bank employees are satisfied with their jobs in
comparison to their private sector counterparts. Since the p-value for chi-square test is 0.000, the difference in
job attitudes between the two sectors is significant (Table 7-B).
Table 7-A: Attitudinal differences for Question 7
Type of Organization
Total
Public
Private
34
Taking all
Not at all
Satisfied
Count
% within Type
of Organization
Count
0
34
things into
consideration,
.0%
18.9%
8.9%
how satisfied Not Satisfied
are you with
0
57
57
% within Type
of Organization
Count
.0%
31.7%
15.0%
your service
here?
Partially
Satisfied
41
87
128
% within Type
of Organization
Count
20.5%
48.3%
33.7%
Satisfied
116
2
118
%
within Type
58.0%
1.1%
31.1%
of Organization
Count
Very satisfied
43
0
43
%
within Type
21.5%
.0%
11.3%
of Organization
Count
Total
200
180
380
%
within Type
of Organization
Table 7-B: Chi-square Test for Question 7
100.0%
100.0%
100.0%
Value
260.335
380
df
4
Asymp. Sig. (2-sided)
.000
Pearson Chi-Square
No. of Valid Cases
Results of the study indicate that the private sector bank employees are less satisfied with their jobs as
compared to public sector bank employees. Private sector bank employees perceive that their jobs are not as
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International Peer-Reviewed Journal
RH, VOL. 3 JULY 2013
secure as those of the public sector bank employees. They have reported relatively low levels of job satisfaction
due to reasons such as lack of job security; lack of effective social security and welfare policies; lack of
personal development, training and quality improvement opportunities; autocratic leadership; random layoffs;
layoff threats generated by volatile market situations; highly competitive work environment; frustration and
failure due to very challenging jobs; perform or perish policy of the private sector; excess work pressures; multi-
tasking; perceived over-qualification; pay instrumentality; rigorous performance appraisals, etc. The results are
in conformity with the RBI figures released in July, 2012, indicating that public sector bank employees get 27%
more as salary and other monetary benefits than their private sector counterparts. Private sector bank employees
were getting more than public sector bank employees till 2009, but the scenario has changed in the last 2
years. Moreover, public sector banks, today, are the largest recruiter in the market. For every one vacancy in
the public sector banks, the aspirants run into thousands (Bank Quest, 2011).
Research Limitations
The major limitation of this study is its reliance on cross-sectional and self-report data. The study was
confined to public and private sector banks in Mumbai. In order to generalize the findings, the study should
have covered foreign banks also. The bank employees were reluctant to disclose their job attitudes for fear of
reprisals from their higher ups. Most of them needed to be convinced that the study was purely for research
purposes and their identity would be kept confidential. The study can be extended to job satisfaction outcomes.
Conclusion And Suggestions
The endeavour of this study is to contribute to the existing body of knowledge on job satisfaction, particularly
in the context of Indian banking sector. For the success and sustained growth of Indian banks, it is important to
conduct job satisfaction surveys frequently so as to investigate general work atmosphere and take precautions
for possible problems that may occur about human resources. Reviewing and improvising the existing HR
policies based on employee feedback will help towards developing a competent work force in the banking
sector. Public-private variations do play a significant role in influencing the job attitudes of employees working
in these sectors. The banks need to keep pace with the fast changing global environment to become globally
more competitive. A pool of committed employees has to play a key role in this journey of transformation.
Employees are the main source of value creation and sustainable differentiation. Since the banking institutions
are the fulcrum of a nation’s economy, effective management of human resources by developing a positive
organizational culture and making the employees feel wanted and cherished can add to a nation’s prosperity.
Private sector banks need to work more towards creating a pool of committed employees by providing more
of job security, job stability, welfare policies to its employees and bringing in more realistic, transparent , highly
objective and participative performance appraisal systems.
References
•
Bajpai, Naval & Srivastava, Deepak. ‘Sectorial Comparison of Factors Influencing Job Satisfaction in
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•
•
Bank Quest. The Journal of Indian Institute of Banking and Finance 82.3 .2011. 1-3. Print.
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Journal of Managerial Psychology. 2003. 368-376. Print.
•
•
D’Souza, Errol. “Employment and Human Resource Practices in Public Sector Banks in the Nineties.”
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•
Islam & Saha. Job satisfaction of Bank Officers in Bangladesh (n.d.) (n.p.). Print.
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•
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•
Purang & Shrivastava. ‘Employee Perceptions of Job Satisfaction: Comparative Study on Indian Banks.’
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