Academic journal article Social Behavior and Personality: an international journal

Chinese Employees' Work Values and Turnover Intentions in Multinational Companies: The Mediating Effect of Pay Satisfaction

Academic journal article Social Behavior and Personality: an international journal

Chinese Employees' Work Values and Turnover Intentions in Multinational Companies: The Mediating Effect of Pay Satisfaction

Article excerpt

In this study the aim was to ascertain the effects of work values on pay satisfaction, organizational commitment, and turnover intention in a Chinese context. Pay satisfaction and work values were employed as determinants of organizational commitment and turnover intention. The mediating effect of pay satisfaction on work values and turnover intention was also examined. A total of 260 questionnaires were distributed to employees of selected multinational corporations in the semiconductor industry in Shanghai, in the People's Republic of China. The results indicated that pay satisfaction led to greater organizational commitment and lower turnover intention. Participants also indicated that their work values significantly affect normative commitment and turnover intention through pay satisfaction.

Keywords: work values, pay satisfaction, organizational commitment, turnover intention.

Workers in the People's Republic of China have become accustomed to the varying aspects of employment. Today, many view job choice and turnover intent as distinct aspects of work and are aware that these are directly related to their job. However, since this was not always the case this new attitude of workers has created problems in the current labor market in China. Younger generations of Chinese workers have become individualistic and materialistic and also tend to seek more challenges and changes, thus causing them to pursue better employment opportunities and seek higher wages (Ralston, Egri, Stewart, Terpstra, & Kaicheng, 1999).

From a human resource management (HRM) perspective, these conditions have created other problems that are associated with employment in China. Alien and Meyer (1996) found that turnover intentions were negatively associated with organizational commitment. This indicated that attention needs to be given to the strategies that are used currently to prevent employee turnover. Turnover is costly to an organization because of the losses that are associated with it (Lum, Kervin, Clark, Reid, & Sirola, 1998). HRM professionals need to focus their efforts on reducing employee turnover in order for Chinese businesses and industries to operate efficiently.

Mitchel (1981) concluded that if personal and organizational context variables have any effect on turnover or turnover intention, it is probably through role perceptions. Although researchers have examined the effect of commitment on turnover intention, of pay satisfaction on organizational commitment, and of work values on organizational commitment, few have tried to determine if there is a relationship between these factors in a Chinese context. To predict turnover intention adequately it is necessary to examine current Chinese employee work values and the factors that are related to these.

In the current study we examined literature on the topic of current employment issues in China. It became apparent that multinational corporations operating in China (MNCs) need to address present employment issues so that they can continue to meet the challenges and changes that continue to evolve in a corporation today. MNC managers have been found to experience a variety of problems with workers, some of which resulted from cultural differences. However, it was also thought that these problems were related to the fact that industry in China continues to undergo changes.

LITERATURE REVIEW

CHINESE CULTURAL VALUES

In a survey of values, Hofstede (198Oa) identified four cultural dimensions; power distance, uncertainty avoidance, individualism/collectivism, and masculinity/femininity. However, it should be noted that in the analysis of data in the survey of Chinese values a dimension that resembled uncertainty avoidance was not found. In contrast, the fourth dimension in the data was rooted in the teachings of Confucius. Chinese people are known for having values that are oriented towards the future like thriftiness and persistence; they also value respect for tradition and fulfilling social obligations (Hofstede, 1993). …

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