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What is employee satisfaction and how do you improve it?

7 min read
Employee satisfaction is at the heart of any employee engagement programme. What is it, and how can you measure it?


What is employee satisfaction?

Put simply, it is how happy employees are with their jobs. It covers the ‘nuts and bolts’ factors that affect employees at work:

  • Working environment – is it pleasant, clean and comfortable, free from stress, discrimination and harassment?
  • Compensation – are the salaries and benefits competitive and make employees feel valued?
  • Workload – is it manageable and distributed fairly?
  • Relationship with management – are employees managed well and with respect, and in turn respect management?
  • Relationship with the team – does everyone pull together and get on with each other?
  • Resources – do employees always have the right equipment or tools for the job, and enough of them?
  • Job security – are employees reassured that their jobs are secure, and the business is honest and transparent about its health and future viability?
  • Career advancement – what opportunities are there to train, take on more responsibility and earn more?
  • Work/life balance – how much does work/commuting affect home life?

Employee satisfaction vs employee engagement

Even as long ago as the 1930s, industrial psychologists recognised that job satisfaction was beneficial for both workers and businesses. And so the ‘job satisfaction questionnaire’ beloved of personnel managers was born.

This survey was widely used until the early 1990s, when HR professionals realised that employees needed to be more than just satisfied with their jobs. They had to be motivated and engaged with challenging work, recognition and responsibility in addition to those contractual ‘nuts and bolts’ of the job. This combination developed into employee engagement.

While employee satisfaction and employee engagement sound like the same thing, they are different:

  • Employee satisfaction – an employee may be perfectly satisfied with their job because it pays their bills, maintains the status quo and fits their lifestyle. Some satisfied employees do the bare minimum required to keep their jobs. They are not necessarily motivated by the development and success of the company as a whole.
  • Employee engagement – runs deeper; an engaged employee is usually also a satisfied employee, but they have passion, commitment and a desire to ‘go the extra mile’ to make the company a success. Engaged employees thrive on challenge, purpose and meaningful work.

That is not to say that employee satisfaction is an outdated concept for 21st century businesses. Finding out whether your employees are happy is the first, crucial step towards creating a valuable, engaged workforce.

4 reasons why employee satisfaction is important

  1. Productivity: It’s well known that workers who are happy in their jobs or tasks are more productive. A good employee satisfaction survey will not only be able to identify an unhappy worker, but also pinpoint what is causing their discontentment. Then, you can focus on addressing their issues and getting them back to full productivity.
  2. Employee retention: Satisfied, engaged employees are 87% less likely to leave their workplaces than unsatisfied ones. When you consider how much it costs to recruit replacement employees, it makes sense to retain the ones you already have. A survey can identify workers who may be thinking of leaving so you can make a swift intervention and persuade them otherwise.
  3. Employee loyalty: Caring about your employees’ happiness shows that the company has their best interests at heart. Workers who feel treasured will embrace a business’s mission and work hard to achieve its goals. They’ll also tell other people how great it is, which is good for company reputation and employer branding.
  4. Identifying training gaps: It’s essential that employees continuously learn, train, upskill, reskill and develop in their jobs. And it’s even more essential that the training is relevant to them. Targeted satisfaction survey questions will reveal gaps in training, skills or knowledge that you can plug.

eBook: The Essential Guide to Employee Experience Surveys

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The 3 Ms of employee satisfaction and how to measure them

Employee satisfaction can appear to be a less precise science than other key performance indicators such as revenue, income or profit. But if you break it down into the following 3 Ms, it becomes easier to survey, analyse and score:

  • Mood – how happy or unhappy are employees?
  • Morale – how capable are employees of working together consistently and persistently to achieve a common goal?
  • Motivationwhat makes employees work hard and achieve their goals?

You can explore the 3 Ms through a fourth M – Measurement. The simplest way of doing this is through a survey that uses a Likert scale.

The survey should be:

  • Anonymous – to get the most honest responses
  • Easy to understand – using simple, clear questions
  • Not too long – too many questions make respondents click off
  • Consistent year on year – to track data over time
  • Powered by tech – let AI software crunch the data and reveal insights

You will need to state a clear purpose for the survey at the beginning, what the feedback will be used for, and how long it will take to complete.

As well as an annual survey, you can distribute pulse surveys that ask just one question, e.g. ‘How satisfied are you with the proposed office relocation?’  at any time to gauge sentiment about a single issue.

Employee satisfaction survey questions

You can customise your surveys to ask whatever is pertinent to your business, but generally, the questions fall into three categories:

Company culture

How satisfied or dissatisfied are you with:

  • Connection with your team workers
  • Company willingness to embrace change
  • How your employee feedback is valued
  • The culture as a whole

Relationship with management

How satisfied or dissatisfied are you with:

  • Transparency
  • Communication
  • Workload distribution
  • How your contributions are valued
  • Managerial investment in the team’s success

 The job itself

How satisfied or dissatisfied are you with:

  • Career development
  • Resources – your tools and technology
  • Clarity of responsibilities
  • The meaningfulness of your work
  • Your job as a whole

Survey response data will give insights into the mood, morale and motivations of your employees. From this, you will be able to extract scores for employee satisfaction, make improvements, and track them over time.

eBook: The Essential Guide to Employee Experience Surveys