e-ISSN: 2395-0463
Journal for Studies in Management and Planning
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June 2016
A Study on the Factors of Job Satisfaction among
Entrepreneurs of Small and Medium Enterprises in the
Batticaloa District
Mr. V.J.Delima ; Mr. K.Pushpakaran
Assistant Lecturer in Management, Department of Management, Eastern
University, Sri Lanka Email: d_jeniston@hotmail.com
Senior Lecturer in Economics, Department of Economics, Eastern University,
Sri Lanka Email: pushpakarankugathasan@yahoo.com
Abstract
The Small and Medium Enterprises (SMEs)
in Sri Lanka has suffered drastically in the
past in the North and East as a result of the
civil war and T-sunami havoc. The studies
have shown that SMEs play a vital role on
promoting economy and especially, on
reducing poverty. Many studies have been
carried out on this topic at international,
global and national level. Similar study has
not been carried out in the Batticaloa
District with special reference to the job
satisfaction among entrepreneurs of SMEs.
This paper is based on a study of different
variables for job satisfaction among
entrepreneurs of SMEs in the Batticaloa
District. Primary data on the factors of job
satisfaction of entrepreneurs were collected
and analyzed using various statistical and
research tools. SPSS was used to analyze to
identify level and correlation of the
variables of job satisfaction. It was found
that all the factors are positively correlated
with job satisfaction of entrepreneurs. It
was also noted that suitability and business
image have been identified as highly
correlating factors with job satisfaction of
entrepreneurs and financial benefits have
been identified as least correlating factor
with job satisfaction of entrepreneurs.
Keywords—Small and Medium Enterprises
(SMEs), Entrepreneurs, Job Satisfaction
1. Introduction
Small and medium enterprises (SMEs)
sector is one of most considered critical
units that support to achieve sustainable
economic growth in Sri Lanka. It is the
foundation part of Sri Lanka’s economy
because, it encompasses all the sectors such
as agriculture, industry, and services. SME
plays a vital role in economy by forming
employment, generating income, reducing
poverty, and supporting large scale
industries therefore, it promotes inclusive
growth. Although SME provides several
benefits to the nation, SME sector is yet to
be improved due to several drawbacks.
Gender bias is one of most severely
affecting problem in SME. In most cases,
male workers are dominating rather than
female worker which shows inequality of
employment in SME (Chell, 2001); lack of
access to marketing opportunities and
financial constraints, high degree of
absenteeism, and lack of technological
capabilities are the other issues. These
drawbacks lead to affect job satisfaction of
the entrepreneurs in the Batticaloa District.
Job satisfaction is an appropriate measure
of entrepreneurs’ satisfaction with their
work. Job Satisfaction comprises of
entrepreneurs’ feelings of pleasure or
disappointment, resulting in their jobs. In
order to find out job satisfaction, this study
is aimed at identifying level of factors that
affects the job satisfaction, relationship
between factors of job satisfaction, impacts
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on the factors of job satisfaction, and
provides general recommendations to
entrepreneurs of SMEs.
Department
of census
and statistics
of Sri Lanka
2. Literature Review
2.1. Definition of Small and Medium
Enterprises
Small and medium enterprise is a business
which has a least market share in market
and does not have dominance on other
businesses in market. SMEs mainly focuses
on niche markets therefore, it needs small
amount of capital to initiate the business
and needs least number of employees to run
the business. Decision making will be made
based on their data which they have
experienced in the past. In order to identify
the SMEs, only a few Sri Lankan
organizations
have
given
their
measurements.
Table 1: Definition of SMEs
Organization
s
Criterion
Industrial
Developmen
t Board
Value of
machiner
y
Betwee
n4
million
to 10
million
Ministry of
Small and
Rural
Industries
Total
investme
nt
Betwee
n 20 to
50
million
rupees
Ministry of
Industry
Tourism and
Investment
Promotion
Value of
fixed
assets
other than
land and
building
Up to
16
million
rupees
Not
exceedin
g 16
million
rupees
Capital
employed
Betwee
n2
million
to 20
million
rupees
Not
exceedin
g2
million
rupees
Federation
of Chambers
of
Commerce
and Industry
of Sri Lanka
Mediu
m Scale
Small
Scale
Not
exceedin
g4
million
rupees
Between
1 million
to 20
million
rupees
Sri Lanka
Export
Development
Ceylon
National
Chamber of
Industries
The
Department
of Small
Industries
Sri Lankan
Apparel
Industry,
Task Force
on Five
Years
Strategy
(2002)
Sri Lanka
Standards
Institution
Number of
employees
More
than 25
Capital
investment
excluding
lands and
building
More
than 40
million
rupees
Annual
export
turnover
More
than 100
million
rupees
Value of
assets
other than
building
and lands
Between
4
million
to 20
million
rupees
Number of
employees
Between
10-50
Capital
investment
Number of
employees
Between
5 to 25
million
rupees
Between
50 to
100
Export
value
Between
101 to
250
million
rupees
Number of
employees
Between
1 to 100
Number of
employees
Between
50-249
Not
exceeding
25
Not
exceeding
20
million
rupees
Not
exceeding
100
million
rupees
Not
exceeding
4 million
rupees
Not
exceeding
10
Not
exceeding
5 million
rupees
Not
exceeding
50
Between
0.25 to
100
million
rupees
Between
101 to
250
Not
exceeding
50
(Source: Dassanayaka, 2009)
However, it is not easy to define SMEs.
Although there are many different
definitions about SMEs, it can be divided
into two types such as size and
characteristics of business, number of
employees, capital, fixed assets, yearly
turnover, electricity, and production are the
factors which are considered in the size of
business. Technology, nature of business,
nature of market, structure of entity, and
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management skills are the factors which are
considered in characteristics of business.
2.2.Definition of Job Satisfaction
Job satisfaction is basically defined as the
feelings of particular employee who has
about his or her job. An employee with high
level of job satisfaction leads to high level
of positive feelings about his or her job. In
contrast, an employee with high level of
dissatisfaction leads to low level of positive
feelings about his or her job. In many field
of businesses and researches, job
satisfaction is significant attribute that has
received more attention nowadays because,
a satisfied employee is fundamental
element of organizational success.
Job satisfaction is people’s feelings about
their jobs and different aspects of their jobs
(Spector, 1997). According to Ellickson
and Logsdon (2002), job satisfaction as the
extent to which people like their jobs.
Gordon (1999) indicates that job
satisfaction occurs when a job meets the
anticipation and values of individuals and it
impacts the commitment and performance
of individual. Job satisfaction is multidimensional concept which gives different
understanding to different people (Mullins,
2002). According to Ayranci (2011), job
characteristics affect workers’ job
satisfaction.
Competence is an extremely valuable
quality that effectively utilizes the skills of
personnel in the given situation and the
better competence will rise the worth of
personnel (Ismail et. al., 2015). The worth
of personnel and entrepreneurs’ feelings
about competence affects their job
satisfaction
(Ayranci,
2011).
Job
characteristics is a fundamental features of
task which is assigned to personnel. These
features or characteristics are required to
create high level of motivation and
performance (Anjum et al., 2014).
Empirical evidences say that job
characteristics have greater degree of
connection with job satisfaction (Hadi and
Adil, 2009). In the context of working
condition, Robbins (1998) states that
working
conditions
influence
job
satisfaction with a comfortable physical
work environment and this will provide
positive level of job satisfaction. Effective
communication leads to an organizational
success and satisfaction (Eisenberger et.al.,
1986). Employee’s communication with
co-workers
and
management
or
entrepreneurs improve the job satisfaction
(Eisenberger et.al., 1986). Business image
is the strength that lies among the
entrepreneurs because, business image and
reputation are associated between them
(Bitner, 1990; Gronroos, 1984). According
to Ayranci (2011), financial benefits and
social benefits, and the freedom of
employees in business-related activities
positively affect the job satisfaction.
3. Conceptual Framework
Competence
Job Characteristics
Work Conditions
Job
Satisfaction
Communication
Business Image
Suitability
Financial Benefit
Figure 1: Conceptual Framework
(Source: Ayranci, 2011)
4. Research Methodology
The aim of this research is to explore the
job satisfaction of the entrepreneurs of
SMEs in the Batticaloa district. This study
is based on primary data. These data were
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collected through the administrated
questionnaire from the Batticaloa District.
Convenience sampling technique was
carried out to collect the data from
entrepreneurs of SMEs. 200 entrepreneurs
were conveniently selected from the
Batticaloa District and questionnaires were
issued to them. The questionnaire consisted
of two sections such as personal
information and job satisfaction factors. 46
statements were adapted from Ayranci
(2011) to measure job satisfaction of
entrepreneurs of SMEs in the Batticaloa
District.
4.1.Univariate Analysis
In the Univariate analysis, mean and
standard deviation are used to evaluate
individual characteristics of dimensions
and variables. Assessing the level of
dimensions and variables is one of the
objectives of the study with the following
criteria.
Table 2: Decision Criteria for Univariate
Analysis
Decision Criteria Decision Attribute
1.0 ≤ Xi ≤ 2.5
2.5 < Xi ≤ 3.5
3.5 < Xi ≤ 5.0
Low Level
Moderate Level
High Level
4.2.Bivariate Analysis
Bivariate analysis is used to identify the
relationship between two variables. The
correlation coefficient ranges from -1 to +1
to explore the degree of relationship
between the study variables.
Table 3: Decision Criteria for Bivariate
Analysis
Range
r=0.5 to 1.0
r=0.3 to 0.49
r=0.1 to 0.29
Decision Attribute
Strong positive
relationship
Moderate positive
relationship
Weak positive
relationship
r =-0.1 to -0.29
r=-0.3 to -0.49
Weak negative
relationship
Moderate negative
relationship
r=-0.5 to -1.0
Strong negative
relationship
5. Analysis and Discussions
5.1.Personal
Information
Entrepreneurs
of
A total of 250 questionnaires were
distributed among the entrepreneurs of
SMEs in the Batticaloa District. Out of 200
respondents, 82.5% of respondents are
male and 17.5% of respondents are female.
With respect to the age group, 7.5% were in
group of below 20 years, 22.5% were in
group of 21-30 years, 34.5% were in group
of 31-40 years, 17% were in group of 41-50
years, and 18.5% were in group of above 50
years. With respect to educational
qualifications, 32.5% were in group of
primary, 36.5% were in group of
secondary, 25.5% were in group of GCE
O/L, and 5.5% were in group of others.
With respect to work experience, 25% were
in group of below one year, 19.5% were in
group of 1-3 years, 12.5% were in group of
4-7 years, 14.5% were in group of 8-10
years, and 28.5% were in group of above 10
years.
4.2.Research Information
4.2.1. Reliability Test of Data
Cronbach’s alpha reliability method was
employed to confirm the reliability of data
in the context of study problem. These
results indicate that these factors are more
than 0.6. Therefore, it reveals that variables
used in this study were highly reliable.
Table 4: Reliability Test of Data
Factors
Competence
Number of
Statements
12
Cronbach’s
alpha
0.796
7
0.604
Job
Characteristics
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Working
Conditions
Communication
Business Image
5
0.602
8
5
0.727
0.790
Suitability
6
Financial
3
Benefits
Job Satisfaction
46
(Source: Survey Data)
0.818
0.616
0.864
4.2.2. Descriptive Analysis
The study is aimed at identifying the level
of job satisfaction from entrepreneurs of
SMEs in the Batticaloa District. The 46
items scale adapted for the study purpose
based on Ayranci (2011) was utilized.
Respondents are used a 5-point Likert scale
(1 = strongly disagree; 5 = strongly agree)
to rate the extent to which they were agreed
with each of the 33 statements. Descriptive
analysis was performed on the responses
are shown on below tables.
Table 5: Univariate Analysis
Factors
Mean
Standard
Deviation
0.472
0.422
Competence
3.799
Job
4.009
Characteristics
Working
3.599
0.540
Condition
Communication 3.653
0.513
Business Image
3.749
0.687
Suitability
3.579
0.609
Financial
3.155
0.467
Benefits
Job Satisfaction
3.650
0.314
(Source: Survey Data)
The result shows that competence lies in the
range of high level of significant attribute
in job satisfaction with the mean value of
3.799. Competence is the key that gives the
idea of how to do, think, and work for the
situations.
Therefore,
competency
employee will increase quality of work and
it leads to job satisfaction of entrepreneurs
(Ismail et.al, 2015). Job characteristics lie
in the range of high level of significant
attribute in the job satisfaction with the
mean value of 4.009. Researchers share that
highlighting the nature of work and effect
on job outcomes of entrepreneurs (Samad,
2004). Working conditions lie in the range
of high level of significant attribute in the
job satisfaction with the mean value of
3.599. Because, working environment has
positive effect on the performance of their
employees as well as entrepreneurs
(Spector, 1997). Communication lie in the
range of high level of significant attribute
in the job satisfaction with the mean value
of 3.653. Because, communication is a key
to improve responsibility and motivate to
achieve firm’s goal (Tsai, Chuang & Hsieh,
2009). Business image lie in the range of
high level of significant attribute in the job
satisfaction with the mean value of 3.749.
Because, business image is a must which
needs to differentiate from other
competitors’ products and leads to job
satisfaction of entrepreneurs (Abd-ElSalam, 2013). Suitability lies in the range
of high level of significant attribute in the
job satisfaction with the mean value of
3.579. Because, suitability is the factor
which is related with entrepreneurs’
willingness of business (Ayranci, 2011).
Financial benefits lie in the range of high
level of significant attribute in the job
satisfaction with the mean value of 3.155.
Because, entrepreneurs should be satisfied
by financial benefits and if it so, it leads to
continue the business. Overall results
shows that entrepreneurs have high level of
job satisfaction in the Batticaloa District..
5.2.3. Relationship between Factors and
Job Satisfaction
Table 6: Relationship between Factors and
Job Satisfaction
Factors
Competence
Job
Characteristics
Relationship between
job satisfaction
0.490**
0.638**
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Working
0.549**
Condition
Communication
0.633**
Business Image
0.660**
Suitability
0.762**
Financial
0.235**
Benefits
**. Correlation is significant at the 0.01
level (2-tailed)
(Source: Survey data)
From the correlation table, it is seen that all
the factors of job satisfaction are positively
correlated with job satisfaction and all are
found to be significantly correlated at 0.05
level. Strong positive correlation is found
between suitability and job satisfaction (r =
0.762; p <0.000); business image and job
satisfaction (r = 0.660; p <0.000); job
characteristics and job satisfaction (r =
0.638; p <0.000); communication and job
satisfaction (r = 0.633; p <0.000); working
conditions and job satisfaction (r = 0.549; p
<0.000). Moderate positive correlation is
found between competence and job
satisfaction (r = 0.490; p <0.000) and weak
positive correlation is found between
financial benefits and job satisfaction (r =
0.490; p <0.000).
6. Conclusion
This study aimed at studying factors of job
satisfaction among entrepreneurs of small
and medium enterprises in the Batticaloa
District. Conceptual model has been
adopted from Ayranci (2011). Job
characteristics and competence indicate
high level of significant factors in job
satisfaction among entrepreneurs of SMEs
in the Batticaloa District. On other hand,
financial benefits and suitability indicate
low level of minor significant factors in job
satisfaction among entrepreneurs of SMEs
in the Batticaloa District. In the of case of
correlation analysis, all the factors have
been positively correlated with job
satisfaction
among
entrepreneurs.
Suitability and business image have been
identified as highly correlating factor with
job satisfaction of entrepreneurs and
financial benefits have been identified as
least correlating factor with job satisfaction
of entrepreneurs.
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