Economic theories consider the public sector less efficient and productive than the private sector. (1) The public sector in Taiwan is no exception. (2) To reform its public sector, the government of Taiwan has launched a major privatization effort. (3) However, parts of the public sector (e.g., public schools and governmental offices) cannot be privatized. Here, other strategies need to be formulated and incorporated into the reform process. To design the strategies for resolving the problem effectively, the causes of the problem must first be explored.
Literature proposes different arguments to account for the causes of low productivity in the public sector. One of these arguments is that public employees' job satisfaction is often lower than that of private employees' because jobs in the public sector lack motivating potential. (4) Although low job satisfaction is not necessarily related to low productivity at the individual level, it is often associated with a higher level of absenteeism and turnover, (5) which in turn can reduce productivity at the organizational level. High job satisfaction, on the contrary, may lower employees' absenteeism and turnover rate, and increase their organizational citizenship behaviors, leading to enhanced overall organizational performance. (6) If public employees' job satisfaction is lower than that of private employees, public institutions should redesign their employees' jobs to enhance motivating potential. Because of the implications of job satisfaction to productivity at the organizational level, one purpose of this study is to compare the differences in job satisfaction, both extrinsic and intrinsic, between public and private employees.
Another argument concerning the causes for lower productivity in the public sector is derived from Baldwin's findings. (7) Baldwin reviewed many empirical studies (8) and concluded that public employees have a greater need for job security than private employees do. A higher need for job security could result in a lower turnover rate in the public sector. The literature on general personnel management suggests that a lower turnover rate can save personnel costs in the recruitment, selection, and training of replacement personnel, and can induce the individual employee's loyalty and commitment to the organization, in turn leading to better organizational performance. (9) However, an excessively low turnover rate is unhealthy to organizations because it may stifle opportunities for internal promotions and for infusing new blood from external labor markets into the organizations, and hence, it may hamper performance at the organizational level. (10) It can be inferred that with a stronger need for job security, public employees' turnover intentions are lower, which results in a lower level of turnover rate that dampens the public sector's productivity. Another purpose of this study is to compare public and private employees' turnover intentions, which few studies have attempted before.
The higher need for job security in public employees also hampers organizational performance through influencing the job satisfaction-turnover relationship. In the literature, job satisfaction is found to be negatively associated with turnover intention, n When employees are dissatisfied, they think more of quitting their jobs. For public employees, dissatisfaction may stimulate less of an intention to quit because of their greater need for security. If those who are dissatisfied continue to stay on in their jobs, their low work motivation will decrease the overall performance of the organization. In Taiwan, there may be many public employees dissatisfied with their jobs who continue to stay, and hence decrease the productivity of their organizations. (12) There have been no empirical studies conducted to compare the differences in the strength of the job satisfaction-turnover intention relationship between the public and the private sectors. …