How to Increase Employee Satisfaction

Employee satisfaction is different than (but related to) employee engagement. Learn why increasing happiness in your workplace needs to be a priority.

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There’s no way around it: employee satisfaction matters when it comes to driving business success. As a report from SHRM puts it, “in 2015, 88% of U.S. employees reported they were satisfied with their job overall, with 37% reporting they were very satisfied and 51% reporting that they were somewhat satisfied.” While this is this highest percentage of job satisfaction that’s been seen in a decade, there’s still a glaring issue: “It is evident that a larger portion of employees are satisfied only to a certain extent, which signals the possibility for improvement,” SHRM continues.

Especially as more and more millennials and younger generations enter the workforce, they’re demanding an increased amount of satisfaction out of their jobs and they’re not letting up. They care more about how happy they are with work than they do about more traditional elements like pay. Employers are facing a changing landscape and those who go with the flow rather than fight it will surely enjoy an endless stream of applicants over the years.

While you understand that employee satisfaction matters, that doesn’t mean you know how to go about achieving it. If you’re wondering “what are the factors that influence job satisfaction?” in the first place, continue reading to find out what you need to know to keep your employees engaged, happy, and sticking around for years to come.

What is employee satisfaction?

It’s important to note that employee satisfaction is different from employee engagement. Engagement has to do with how connected and committed a person is with their job while satisfaction is how happy they are with it. While they often influence each other, they’re not the same thing. For example, how satisfied an employee is with a job often has to do with how engaged they are in their work and vice versa.

While satisfaction at work might seem like a bonus element that an employee would be lucky to have, it’s actually something that owners and managers should prioritize because, as Forbes puts it, engaged employees deliver higher quality work and productivity which results in better customer service, increased sales, enhanced profit, and, ultimately, better shareholder returns.

Measuring satisfaction: What is an employee satisfaction index?

Believe it or not, there’s actually a way that employers can measure how satisfied their employees are with their jobs in a precise way by using the employee satisfaction index (ESI). As Netigate explains, “the main goal with using the ESI is to get a number for comparison over time and between companies,” and is comprised of the following three questions:

  • How satisfied are you with your current workplace?
  • How well does your current workplace meet your expectations?
  • How close is your current workplace to the ideal one?

Employees will answer each question on a scale of one to 10 (one is the lowest and 10 is the highest). All of the employee’s answers are added together and run through this formula: [(((the average value of the answers / 3) – 1) / 9) * 100. The result will be a number between zero and 100, with 100 being a perfect score. Tracking this number over time is the best way to get a read of how satisfied your employees are.

What can companies do to improve job satisfaction?

There are five main contributors to job satisfaction according to SHRM. The top factors are:

  1. The respectful treatment of all employees, regardless of level
  2. Compensation
  3. Benefits
  4. Job security
  5. Trust between employees and senior management

However, there’s more to job satisfaction than just addressing each of these five elements individually. While pay and benefits of course matter, SHRM explains that most employees “consider culture and connection to be of utmost importance.” It’s hard to address any one of these top five contributors without affecting the others, a good idea is addressing all of them comprehensively. “Organizations may need to tailor their retention and recruitment strategies around multiple elements, creating a total rewards program. Relying solely on an individual aspect may make their approach less effective or even outdated as dynamics quickly shift.” 

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