1) The study examined job satisfaction and organizational commitment among 721 employees across 56 small businesses. 2) It found that older workers reported higher levels of overall job satisfaction, commitment to their organization, and satisfaction with management compared to younger workers. 3) Additionally, satisfaction with the work itself increased with age, but satisfaction with pay and promotions declined slightly for those aged 41-50 before rising again.

1. JOB SATISFACTION AND COMMITMENT
OF OLDER WORKERS IN SMALL BUSINESSES*
by Patricia L. Smith and Frank Hoy
Extensive research has examined and more older workers than large
work attitudes such as job satisfaction organizations, groups comprised to a
and organizational commitment and great extent of retirees, homemakers,
has identified various characteristics and students(Barth, Cordes, and Haber
which are related to these constructs. 1984; U. S. Small Business Adminis-
For example, studies indicate older tration 1988). The Office of Advocacy of
workers are more satisfied and com- the U. S. Small Business Administra-
mitted to their firms than younger tion, however, predicts a decline in
employees (Rhodes 1983). The majority both of these groups during the present
of such studies, however, focus on decade. The lower birth rate of the mid-
employees in large firms in a variety of sixties will decrease the number of
work settings. Seldom have these con- younger workers in both relative and
structs been addressed in a systematic absolute terms. Participation in the
manner in small businesses. The rela-. work force of individuals over 55 will
tionship between work attitudes and also decline as more workers choose to
the ages of individuals employed by retire early.
small businesses has received even less With the decline in the labor force of
attention. An understanding of such these particular age groups, small
relationships may be just as important businesses may find it increasingly
to the small business owner as to the difficult to maintain a work force
manager in larger organizations as similar to the one they have employed
both seek to deal with the increasingly in the past. They will be at an economic
older work force predicted by the U. S. disadvantage as they compete with
Small Business Administration. their larger counterparts for the same
Traditionally, small firms have em- pool of prime age(i.e.,35 to54) workers.
ployed proportionately more younger They may also find it increasingly
difficult to accommodate their chang-
ing employee base in terms of the need
•An earlier version of the paper upon whkhthisarticle for training, flexibility, and increased
w bwwd was presented at the meeting uf the Soathrm productivity. As a consequence, it is
Manai^nient Association. NowmberH-K). tiWO. OrlanA),
Florida. This study was funded by a urant from theSodety incumbent upon the small bosiness
of Haman Resource ManaRement Foondatton. owner to identify characteristics of
l)r. &Jiith i« araislant imrfMMir of buiam»Mi and employees who will i^ more satisfi^
economics. Berry CoUene. Rome. Geonria.
l>r. Hoy isdeanof theColtetteof Busineits AdministrM- and more committed to their firms. At
tion at the Univomtjf uf Texas at Kl i'aso.
tO6 J<Kirruri

2. present, there is little research to assist faction is more than just the sum of
small business owners in these en- individual work facets and that fre-
deavors. quently some important variables are
This study attempts to remedy this omitted from the measurement of job
omission. It examines the relationship satisfaction. For example, employee
of work attitudes and characteristics of satisfaction in a small firm, where
employees of various age groups to owners typically have close working
identify those individuals who are relationships with their employees,
inclined to make long-term commit- may be influenced by the employees'
ments to their companies. assessment of top management.
BACKGROUND Studies indicate both satisfaction
Both job satisfaction and organi- and commitment may be moderated by
zational commitment have long been situational and demographic character-
recognized as antecedents of employee istics of employees. Exogenous factors
tenure. Job satisfaction has been de- such as organizational size (Harari,
fined by Locke (1969, 1300) as a Crawford, and Rhode 1983; Hodson
quot; pleasurable or positive emotional state 1984), geographical location (Stepina
resulting from the appraisal of one's 1985), or type of industry (Brush, Mock,
job or job experiences.quot; Organizational and Pooyan 1987) are said to influence
commitment is viewed as an attitude work attitudes. Research findings also
involving employee loyalty to the suggest satisfaction and commitment
organization, with those individuals have a strong, positive relationship
who are committed being willing to with position level (Kerber and Camp-
contribute something of themselves to bell 1987; Stepina 1985) and tenure(Lee
their organizations (Angle and Perry and Wilbur 1985) and a negative re-
1981; Cook, Hepworth, Wall, and Warr, lationship with education (Mottaz
1981; Morris and Sherman, 1981; Porter 1984), while the two constructs are
and Smith, 1970). indirectly related to gender (Andrews
and Withey 1976; Weaver 1977).
Satisfaction with various aspects of
occupational experiences is as difficult Based on an extensive review of the
to characterize as is satisfaction with literature on age, Rhodes (1983) con-
other forms of everyday experiences cluded that overall job satisfaction is
(Cook et al. 1981). With increased positively associated with age: older
awareness of the significance of em- workers appear to evince greater satis-
ployee job satisfaction, researchers faction with their employment than
have designed a number of instruments younger workers. The form of relation-
which attempt to measure employee ship, however, is not clear. While
attitudes, values and perceptions as numerous studies suggest a linear
theyrelateto occupational experiences. relationship (Lee and Wilbur 1985;
Such instruments include specific in- Mottaz 1987; Weaver 1978,1980), others
dividual facets such as work, pay, reported a U-shaped relationship(Herz-
promotions, co-workers and supervi- bei^, Mausner, Peterson, and Capwell
sion, rather than global measures of 1957; Kacmar and Ferris 1989). Kalle-
employee satisfaction, so that explicit berg and Loscocco (1983) contend that
areas of low job satisfaction may be satisfaction increases until age 40,
identified. ihen levels off, and then increases
Scaipello and Campbell (1983) con- again when employees reach their late
tended, however, tiiat global job satis- 50s.
107

3. The individual facets of job satisfac- may be experienced, they may be less
tion (e.g., work, pay, promotions, co- flexible and may resist retraining or
workers, and supervision) have been performing a variety of functions neces-
examined in numerous studies to de- sary in the small firms.
termine age-related differences. Results The purpose of this article is to report
strongly support a positive association findings of a study which examined
between age and work itself (James work attitudes of 721 employees in 56
and Jones 1980; Muchinsky 1978) while small husinesses in a metropolitan area
the results of research examining age to determine the relationships between
and satisfaction with pay are mixed age and other characteristics with
(Muchinsky 1978). Rhodes(198;5) found various aspects of the employees' satis-
no strong support for relationships faction and commitment toward their
between age and promotions, pay, co- firms. Specifically the following re-
workers, or supervisors in her review of search questions were addressed:
the literature. She further stated: 1. Are measures of job satisfaction,
In view of the absence of age-related organizational commitment, and satis-
differences in satisfaction with pay, faction with management as well as
promotions, supervision,and co-workers, individual facets of job satisfaction
it would seem that the increase in overall (i.e., work, pay, promotions, co-workers,
job satisfaction associated with aging is and supervision) of employees in small
in large part a reflection of the increase firms moderated by demographic and
in satisfaction with the nature of the job. job-related characteristics(i.e., age, sex,
education, tenure, management status,
Rhodes (1983) reported the results of and type of industry)?
17 bivariate analyses showed older 2. Are measures of satisfaction and
workers to be more committed to their commitment of older workers in small
organizations than younger workers. firms greater than that of younger
Five analyses were less conclusive. The workers?
preponderance of the evidence from 3. Are there interactive effects of
empirical studies, therefore, identifies management status and tenure on
a strong relationship between age of measures of satisfaction and commit-
employees and organizational com- ment of older workers in small firms?
mitment. METHODOLOGY
Traditionally, small businesses have
employed more younger and more older Sample
workers relative to their other em- Fifty-six organizations (15 construc-
ployees than large companies. During tion companies, 20 manufacturing
the next decade, however, the size of firms, and 21 wholesale distributors) in
these groups is expected to decline. The a large metropolitan statistical area
fastest growing segment of the work- were randomly selected from the Small
force will be between the ages of 45 and Business Data Base (SBDB), a collec-
54, an increase of 72.2 percent and a tion of statistical information syste-
gain of almost 13 million workers(U. S. matically organized hy the U. S. Small
Small Business Administaration 1988). Business Administration for research
Many of these workers are former on small husinesses. The influence of
employees of large con>orations who size and geographical location on satis-
have downsized and have chosen to faction and conunitment was partially
release their more highly paid em- conteolled by using tiie segnient of the
ployees. While this group of workers SBDB identiftring husinesses which
Jounuri of SIMM B i » b i w i MMumwiMNrt

4. employed fewer than 1(K) and more instrument with other measures of
than 20 employees in a limited geo- organizational commitment(Cook, Hep-
graphical area. At the time of the study, worth, Wall, and Warr 1981) and con-
14 of the firms had fewer than 25 sistently high internal reliability (Mow-
employees, 20 had between 26 and 50 day, Steers, and Porter 1979). Internal
employees and 12 had between 50 and reliability for the organizational com-
100 employees. Four of the organi- mitment scale in the present study was
zations were less than 6 years old, 12 0.92.
had been in existence between 6 and 10 Satisfaction with management. To
years, 17 between 11 and 20 years, and incorporate a full assessment of global
23 were started more than 20 years satisfaction and to develop a valid and
previously. reliable measure of this construct, the
All employees in each organization present study included a measure of
were asked to complete questionnaires employee satisfaction with top man-
and retum them anonymously to the agement. Subject matter in several
researcher in individual business-reply scales (Cook and Wall 1980; Taylor and
envelopes which were provided. Em- Bowers 1972) was used to construct a
ployee responses ranged from 24 to 72 five-item semantic differential scale to
percent of the work force within each assess this area of interest. Internal
firm. reliability for the satisfaction with
Questionnaire management scale was 0.96.
The questionnaire completed by
responding employees was designed to ANALYSES AND RESULTS
measure employee satisfaction with Of the 721 employees who returned
work, pay, promotions, co-workers and questionnaires, 134 were employed by
supervision; organizational commit- construction companies, 230 by manu-
ment; and satisfaction with top man- facturing firms, and 357 by wholesale
agement. It also gathered demographic distributors. Two hundred ninety-six
data. were females and 425 were males. A
Employee job satisfaction. The Job wide variety of education levels was
Perception Survey (JPS) (Hatfield, reported with 79 respondents (11 per-
Robinson, and Huseman 1985), a 21- cent) having less than a twelfth-grade
item semantic differential instrument, education, 171 (24 percent) having
was used to assess individual satisfac- completed the twelfth grade, and 471
tion withfivedimensions of jobs (work, (65 percent) having some form of higher
pay, promotions, co-workers, and super- education.
vision). Internal reliability coefficients The respondents were classified into
in the present study for the five se- four age groups: less than 31 years of
mantic differential scales of the JPS age (n = 286), between 31 and 40 (n =
ranged from 0.89 to 0.99 with a Cron- 183), between 41 and 50 (n = 154) and
bach alpha of 0.96 for the composite over 50 (re = 98). Two hundred (28
measure of satisfaction. percent) of the employees had been
Organizational commitment. Nine with their firms for less than one year,
items were selected from the scale 295 (41 percent) for one to five years,
developed by Porter and Smith (1970) and 226 (31 percent) for overfiveyears.
to assess commitment to the oi^aniza- Five-hundred fourteen (71 percent) were
tion. Evidence indicates high conver- classified as non-management and the
gent and discriminant validity of this remaining as management.
109

5. Initial analyses involved the use of examined simultaneously. Results re-
multiple regression to examine the veal significant differences in satis-
effects of the five employee variables faction with work (F-value = 6.45, p <
and type of industry on overall job .0003), pay (F-value = 7.81, p < .0001),
satisfaction, organizational commit- and promotions (F-value = 5.01, p <
ment, and satisfaction with manage- .001) due to age differences of the em-
ment. Results, shown in table 1, reveal ployees. Table 3 presents mean scores,
that age and management status were standard deviations, and MANOVA
positively and significantly related to results for each individual measure of
these measures. Education was neg- job satisfaction by age category.
atively related to organizational com- The results of the study demonstrate
mitment and to satisfaction with man- that a linear relationship exists be-
agement. Regression was also used to tween age and work satisfaction, but
examine the effects of the employee there was a slight decrease in satisfac-
variables on the individual facets of job tion with pay and promotions for the
satisfaction. In addition to the influ- 41-50 year age group. The relationship
ence of management status and age on of age and satisfaction with co-workers
several of these variables, the analyses and supervision was slightly higher
revealed negative relationships of ten- for the youngest group of employees,
ure with pay, promotions, co-workers decreased slightly for employees in the
and supervisors, and education with 31 to 40 and 41 to 50 year age groups,
co-workers, and positive relationship and then rose for the older group.
of sex and promotions. Overall job satisfaction (i.e., the sum
To test the significances of the age total of thefiveindividual facets of the
differences in employee satisfaction, JPS) rose slightly for the 31 to 40 year
two separate multivariate analyses of age group, declined for the 41 to 50 year
variance (MANOVAs) were employed group, and then rose again. Analysis
using age as the categorical indepen- also revealed a linear relationship
dent variable. First, recognizing the between age and organizational com-
interaction of satisfaction and commit- mitment and age and satisfaction with
ment and because of the highly signifi- management.
cant intercorrelation of overall job Finally, because of the significance
satisfaction, organizational commit- of management status on commitment
ment, and satisfaction with manage- and on all but one of the satisfaction
ment of thefirm(p < .0001), a MANOVA measures and of tenure on four of the
was used to test the effect of age on individual facets of job satisfaction, it
these three measures simultaneously. was deemed advisable to perform sub-
Results indicated that age was signif- sequent analyses to determine the
icantly related to total job satisfaction extent to which these variables were
(f-value = 4.06,p < .01), organizational related to the four age categories.
commitment (f-value = 8.11, p < .0001) Results of MANOVAs are shown in
and satisfaction with management (JF- tables 4 and 5. In a separate analysis,
value = 2.82, p < .05). Table 2 presents intemctions between tenure and man-
means scores, standard deviations and agement status were not found to be
MANOVA results for these ihree vari- significant As tables 4 and 5 show,
ables by age category. there are significant relationships
Next, once again using MANOVAs, between management status and each
the effects of age on the five individual dependent variable, except satisfaction
measures of job satisfaction were with management and satisfaction
110 of SnuM Bwinen M«ii««nent

6. Table 1
RESULTS OF REGRESSION ANALYSIS SHOWING EFFECTS
OF DEMOGRAPHICS, JOB-RELATED CHARACTERISTICS, AND INDUSTRY
ON MEASURES OF EMPLOYEE SATISFACTION AND COMMITMENT
Dependent Independent Standardized
Variable Variables Beta Coefficients
Total Job Satisfaction Age 0.097quot;
Sex 0.040
Education -0.059
Tenure -0.059
Management Status 0.169quot;quot;
Type of Industry -0.037
R-Square 0.046
F-Value 5.685quot;quot;
Organizational Commitment Age 0.140quot;*
Sex 0.010
Education -0.078*
Tenure 0.055
Management Status 0.108**
Type of Industry 0.019
R-Square 0.054
F-Value 6.811****
Satisfaction with Age 0.111**
Management Sex 0.013
Education -0.078*
Tenure -0.CW3
Management Status 0.093**
Type of Industry 0.012
R-Square 0.025
F-Value 3.043**
Satisfaction with Work Age 0.122**
Sex 0.040
Education -0.028
Tenure 0.023
Management Status 0.169****
Type of Industry 0.069
R-Square 0.060
F-Value 7.474-—
Satisfaction with Pay Age 0.087*
Sex 0.025
Education 0.061
Tenure 0.088*
Management Status 0.146****
Type of Industry -^.053
R-Square 0.061
F-Value 7.646****
111

7. Table 1 (conttnued)
Dependent Independent Standardized
Variable Variables Beta CoeNicients
Satisfaction with Age 0.138****
Promotions Sex 0.076*
Education -0.056
Tenure -0.108**
Management Status 0.187****
Type of Industry -0.048
R-Square 0.067
F-Value 8.394****
Satisfaction with Age 0.010
Co-workers Sex -0.022
Education -0.141***
Tenure -0.119**
Management Status 0.075*
Type of Industry -0.014
R-Square 0.033
F-Value 4.035***
Satisfaction with Age 0.054
Supervisor Sex 0.017
Education -0.038
Tenure -0.122**
Management Status 0.019
Type of Industry -0.050
R-Square 0.015
F-Value 1.837
' p<.05. quot; p<.001, quot;** p<.0001.
Table 2
MEANS, STANDARD DEVIATIONS, AND MANOVA RESULTS
FOR TOTAL JOB SATISFACTION, COMMITMENT, AND MANAGEMENT SATISFACTION,
BY AGES OF EMPLOYEES
Ages
<30 31-40 >50
Variables n = 183) (n = 154) F-Value
Total Job
Satisfaction
Mean 17.783 18.150 17.876 19.219 4.06**
S.D. 3.411 3.820 3.655 3.766
Organizational
Commitment
Mean 32.538 34.590 35.131 37.031 8.11quot;**
S.D. 8.863 8.856 7.603 7.619
Management
Satisfaction
3.713 3.736 4.053 2.82*
S.D. 1.121 1.109 0^956 1.046
* p<.05. ** p<.01.**** p<.0001.
112 Jmutiai

8. Table 3
MEANS, STANDARD DEVIATIONS, AND MANOVA RESULTS
FOR INDIVIDUAL FACETS OF ,IOB SATISFACTION,
BY AGES OF EMPLOYEES
Ages
Dependent <30 31-40 41-50 >50
Variables (n = 286) (n = 183) (n=154) F-Value
Work
Mean 3.784 3.904 3.950 4.199 6.45***
S.D. 0.810 0.820 0.872 0.745
Pay
Mean 2.944 3.229 3.071 3.529 7.81*
S.D. 1.062 1.146 1.090 1.037
Promotions
Mean 3.155 3.386 3.279 3.672 5.01*
S.D. 1.166 1.194 1.152 1.161
Co-worker
Mean 3.950 3.834 3.892 3.880 0.54
S.D. 0.920 1.042 0.986 0.995
Supervisors
Mean 4.009 3.873 3.917 4.092 1.78
S.D. 0.815 0.925 0.900 0.874
***p<.001,**** p<.0001.
Table 4
RESULTS OF MANOVAS TO DETERMINE RELATIONSHIP OF MANAGEMENT STATUS
AND TENURE WrTH MEASURES OF OVERALL SATISFACTION,
ORGANIZATIONAL COMMrTMENT, AND SATISFACTION WITH MANAGEMENT,
BY AGES OF EMPLOYEES^
Ages
Dependent <30 31-40 41-50 >50
Variables (n = 286) (n = 183) 1(» = 154) (fl = 98)
Overall Work
Management Status 8.36** 1.46 6.41** 4.20*
Tenure 1.93 1.30 0.79 0.56
Organizational Commitment
Management ^atus 2.81 0.07 2.24 6.05**
Tenure 1.47 1.43 0.01 1.46
Management Satisfaction
Management Status 0.17 2.57 1.97 1.45
Tenure 0.46 0.68 1.26 1.76
*p<.05, **p<01.
Entries in tatilira are f-vaiue». not means.
113

9. Table 5
RESULTS OF MANOVAS TO DETERMINE RELATIONSHIP
OF MANAGEMENT STATUS AND TENURE WITH MEASURES
OF SATISFACTION WITH INDIVIDUAL FACETS OF JOB SATISFACTION
BY AGES OF EMPLOYEESquot;
Ages
Dependent <30 31-40 41-50 >50
Variables (n = 286) (n = 183) 1[n = 154) (n = 98)
Satisfaction
with Work
Management Status 9.59** 0.51 8.08** 3.63*
Tenure 0.20 4.29 0.13 1.93
with Pay
Management Status 5.55** 3.17 3.85* 2.11
Tenure 0.15 2.36 1.16 2.96
with Promotions
Management Status 9.06** 6.57** 6.40** 2.30
Tenure 1.86 0.33 0.93 0.75
with Co-workers
Management Status 1.09 0.40 4.09* 1.73
Tenure 2.06 0.71 0.60 0.93
with Supervision
Management Status 0.99 0.98 0.16 0.50
Tenure 4.26** 2.19 0.62 0.28
*p<,05. **p<.01.
quot;Entries in tatHes are F-values,not means.
with supervision, in at least one age employees (Hisrich and Brush 1987,
category. Of the remaining dependent Hoy and Vaught 1980). Small firms are
variables, only organizational commit- often economically constrained in their
ment was not significantly related to ability to recruit employees by provid-
the responses of 41 to 50 year olds. The ing more attractive salaries, compre-
youngest group of respondents scored hensive benefit packages, and greater
significantly on management status advancement opportunities (Brown,
and overall work satisfaction and Hamilton, and Medoff 1990; Schuler
satisfaction with work, pay and pro- and MacMillan 1984). In addition,
motions. Only two significant relation- small business owners, just as their
ships with tenure were found, with counterparts in large organizations,
work for respondents between 31 and face an ever increasing challenge in
40, and with supervision for respond- selecting employees who not only will
ents 30 and under. be productive but who will remain with
DISCUSSION
theirfirms.Unfortunately, many small
A prime difficulty small business business owners have traditionally
owners encounter in maintaining suc- relied upon interviews and application
cessful, ongoing enterprises is in staff- blanks as their sole selection tools,
ing—finding and retaining competent methods which are less valid and
114 Journal

10. reliable than the more sophisticated hold higher level positions in the organ-
techniques used by larger organiza- izations' hierarchies than younger
tions. Improper selection of employees workers. Results of this study suggest
leads ultimately to high turnover which that management status has a signifi-
can be particularly devastating for cant effect on the commitment measure
small businesses. Results of this re- in the over-5() category. As mentioned
search identified two employee char- earlier, there was no significant rela-
acteristics—age and management sta- tionship for tenure by age. Since others
tus—that were positively related to have held that managers are difficult
measures of job satisfaction and organ- to retain in small organizations due to
izational commitment, while tenure lack of advancement opportunities, it
was positively related to satisfaction may be that the older workers in this
with pay. However, the study revealed sample are having a disproportionate
that the more educated employees in impact on the commitment of higher
the sample were less satisfied with level employees. A third possible inter-
management and their co-workers and pretation is the most obvious from the
less committed to the firm. Female data gathered: older workers are more
employees appear to be j ust as satisfied committed to their organizations in
and committed to their firms as males. this particular sample. If replications
This may be of particular interest to the of this study show this finding to be
small business owner as the number of consistent, it has important implica-
females in the work force increases. tions for small businesses as will be
The high score of workers (over 50 discussed in the conclusions section.
years old) on the organizational com- Results of this study must be viewed
mitment measurement(p < .0001) could with caution for several reasons. First,
be interpreted in many ways. Older analyses reported in this study are
workers were more likely to have been based solely on cross-sectional data
with their companies for a longer which allow only the identification of
period of time than younger workers. associative relationships and preclude
Thus, their sense of commitment may causal interpretation. Second, age vari-
be due to their tenure with their organi- ations in work satisfaction may reflect
zations as much as, or more than, their numerous factors such as nonwork-
age. This may be disputed, however, by related rotes which are not addressed
the lack of a significant relationship in the study. For example, the value
between tenure and commitment in assigned to financial rewards may be a
this study. function of marital status, the number
Similarly, prior research has shown of dependents, or possibly perception
older workers to be less likely to have of equity. Finally, self-report data are
an intention to leave an organisation subject to challenges of their veracity
than younger workers. Studies have and always involve the risk of response
consistently reported a negative rela- bias.
tionship between age and tumover
using both bivariate analyses (Arnold CONCLUSIONS
and Feldman 1982, Martin and Hunt The U. S. Small Business Adminis-
19M) and multivariate analyses (Arn- tration (1988) predicted that one of the
old and Feldman 1982; Mobley, Homer, t h i ^ major trends that will affect small
andfloUingsworth1978). busings through the 1990s is changing
An altemative explanation mi^htbe dem%taphics(the others are changing
that older workers are more likely to technologies and internationalization).
115

11. A critical component of the changing owners have much to gain from re-
demographics is the aging of the jwpu- search along these lines.
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