CHAPTER 1

THE PROBLEM AND ITS BACKGROUND

Introduction

Despite the increasing level of privatization in the world, the public sector in

the developing countries still continue to employ a large number of the workforce

in those countries. It has been suggested that public service employment has been

growing about four times as fast in the developing countries as in developed

countries. Traditionally, the public sector in developing economies has been in the

forefront of economic development. As a result of the strategic importance of the

public sector in the economic development of many countries, there is a concerted

effort to make public sector management respond to the changing needs of

developing nations. There is now a renewed interest in the performance level of

the public sector in many developing countries as they face a more competitive

global environment. Efforts to improve the performance level of the public sector

focus on both personal and contextual variables. Studies show that employees'

attitudes towards work to affect their performance, and in turn personal and job

characteristics influence the attitudes of employees.

Public sector in developing countries is more focused on a more responsive

service and adequate benefits for its employees to increase their performance

level for them to serve better. The increasing pressure from within and from without

to increase the performance and productivity of the public sector in developing

countries makes it imperative to investigate reasons why there is a significant

difference in the levels of performance and productivity in the public and private

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sector. Some evidences from previous studies suggest that public sector

employees experience lower levels of job satisfaction. Implicit in these studies is

the idea that satisfied workers in most organizations tend to contribute significantly

to the effectiveness and productivity of the organization. In contrast low

performance and productivity may be a result of low levels of job satisfaction.

Motivation and leadership on the part of the top management plays an

important factor that makes the employees of the lower level feel job satisfaction.

Job satisfaction has important consequences for organizational effectiveness.

Management needs information on employee job satisfaction in order to make

sound decisions, both in preventing and solving employee problems. Job

satisfaction is a critical factor in organizational behavior. It needs to be understood,

monitored through job satisfaction survey and dealt with so as to avoid some of

the potential by-products of dissatisfaction that may haunt organizations like the

SSS.

Given the evidences that the level of performance and productivity in a

public sector can stand a major improvement, the purpose of this study is to identify

the factors that relate to job satisfaction among public sector employees

specifically employees of Social Security System Cubao Branch. If those factors

would be identified, changes can be made that will result in higher levels of job

satisfaction and consequently an improved level of performance and productivity.

In dealing with the performance of people doing jobs, we are talking about

how well they carry out the tasks that make up their job. When we say that a person

is a good worker, we are making judgments on how the person performs or

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behaves in the job. We can make these judgments according to some standards

that are incorporated in the performance rating. Performance rating is now

regularly conducted in organizations to assess their employees.

Employees are rated based on their performance on how well they do their

jobs, on how they deal with co-workers and the members, personal attribute, and

attendance. The performance rating is the basis for awarding productivity bonus.

Before, job satisfaction is not an issue to the employees of SSS Cubao

Branch, but as time changes employees clamor for more benefits, promotions and

awards.

Since the management needs to give more benefits, promotions and

awards, the management must also control their cost of giving the said benefits to

be able to satisfy their employees. So the researchers were also aimed to study

the costs of giving the following benefits to the employees of the SSS Cubao

Branch, to avoid over giving of benefits to the employees.

Thus, this study would determine the job satisfaction for SSS employees in

Cubao Branch. Identifying the factors that dissatisfies the employees will help the

management in improving employees job satisfaction and eventually will increase

productivity and result to better performance.

Theoretical Framework

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 Job satisfaction can be simply defined as, how content an individual is with

his or her job. Job satisfaction itself not a very new concept in the society; rather it

is an issue that every organization needs to pay attention of. In fact, one of the

biggest preludes to the study of job satisfaction was the Hawthorne studies. These

studies (19241933), primarily credited to Elton Mayo of the Harvard Business

School, sought to find the effects of various conditions (most notably illumination)

on workers productivity. These studies ultimately showed that novel changes in

work conditions temporarily increase productivity (called the Hawthorne Effect). It

was later found that this increase resulted, not from the new conditions, but from

the knowledge of being observed. This finding provided strong evidence that

people work for purposes other than pay, which paved the way for researchers to

investigate other factors in job satisfaction. As we can see the study about job

satisfaction started to emerge in early 1920s, because they believe that one of the

key in the success of an organization is a well established workforce, and to be

able to achieve this, they paid attention to how contented their workforce to their

present job.

There are several theories that are identified toward the understanding of

job satisfaction and these are: comparison theory, instrumentality theory, social

influence theory, equity theory, and two factor theory.

The comparison theory denies that job satisfaction is just an additive

function of the objective outcomes from the job received by the individual. The

instrumentality theory postulates that individuals assess their satisfaction with

jobs by considering the extent to which job lead to valued outcomes. Therefore in

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this theory, it is assumed that each individual has a set of judgments about how

much he values certain outcomes such as pay, promotion, good working condition

etc. Next is the social influence theory, the basic assumption in this theory is that

individuals may come into new jobs not knowing how satisfied they will be with

these. In turn, they look around, see others like themselves who are satisfied and

dissatisfied with, and are then influenced by these observations. Another theory is

the equity theory, according to Kochan (2006), holds that people make cognitive

comparison of their contribution to a work situation and the things they get out of it

with those of other people. So it implies that every person in the organization tend

see whether they receive the right for themselves. The last theory is the two

factor theory which states that, job satisfaction is derived from two sets of factors

namely; positive feelings about the job and related to the content of the work itself

which is called motivation factors. This theory only implies that for a person to

achieve a job satisfaction the person must feel good or be happy about his work,

and should be motivated properly.

We can say that job satisfaction is critically an important ingredient to

organizational success today. Understanding the basic meaning of job satisfaction

is a good primary step to more effectively managing it. Supporting the employees

job satisfaction, would help not only the organization to grow, but its employees

itself. Making the organization equipped with an excellent workforce that is willing

to serve the organization better and contribute of the productivity, effectiveness,

and success of the organization.

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Conceptual Framework

The Social Security System is an organization that is committed in serving

the public. So every employee in the organization is expected to give a high quality

of service to the people. The study precedes the following conceptual framework

in Figure 1. Figure 1 shows the employees profile in terms of age, sex, civil status,

highest educational attainment, length of service, position and monthly salary. The

cost to management variable is presented here, as the dependent variable and job

satisfaction is an intervening variable which is a function of the independent

variable: socio-demographic characteristics and its determinants as stated in the

literature, namely: salary and other benefits, environment and co-workers

relationship, and motivation and promotion. The process uses questionnaire,

unstructured interviews, observation and data analysis.

Between the dependent variable and intervening variable is an arrow

pointing to the dependent variable to indicate direction of possible effects. This is

true also between the intervening variables and independent variables.

It is the concept of this study to determine the cost of the benefits given to

employees and job satisfaction and performance of the employees of SSS Cubao

Branch considering the socio-demographic variables.

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 INPUT PROCESS OUTPUT

Profile of the Survey Policy

Respondents Questionnaire Recommendations
o Age Observation for:
o Gender
Documentation Improved Level
o Civil Status
o Highest Unstructured of Job
Educational Interview Satisfaction
Attainment Statistical Improved Job
o Length of Analysis Performance
Service o Frequency Increased Level
o Present Position o Percentage
o Monthly Salary of Employees
Organizational o Ranking Productivity
Perspective of SSS o Weighted Controlled Cost
o Type of Mean of Employee
Organization o ANOVA Benefits
o Years of
Existence
o Number of
Employees
o Business Hours
o Days Open
Level of Job
Satisfaction of the
Respondents
o Nature of Work
o Salary and
Other Benefits
o Environment
and Co-workers
Relationship
o Motivation and
Promotion
Cost of Employees
Benefits to
Management

FEEDBACK

Figure 1 Conceptual Framework

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Statement of the Problem

This study entitled Job Satisfaction of Social Security System (SSS)

Employees at Cubao Branch: Implications and Cost to Management aimed to

determine the levels of job satisfaction and performance of the organization and

its cost to the management. Moreover, factored in are the profiles of the

respondents, the organizational perspective, the level of job satisfaction, the cost

of benefits given to employees, and any significant differences among the

variables.

Specifically, this research sought to answer the following questions:

1. What is the profile of the employees of the Social Security System Cubao

Branch in terms of the following:

1.1 Age;
1.2 Sex;
1.3 Civil Status;
1.4 Highest Educational Attainment;
1.5 Length of Service;
1.6 Present Position; and,
1.7 Monthly Salary?

2. What is the organizational perspective of Social Security System (SSS)

Cubao Branch in terms of:

2.1 Type of Organization;

2.2 Years of Existence;

2.3 Number of Employees;

2.4 Business Hours; and,

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 2.5 Days Open?

3. How would the level of job satisfaction of the respondents be describe terms

of:

3.1 Nature of Work;

3.2 Salary and Other Benefits;

3.3 Environment and Co-worker Relationship; and,

3.4 Motivation and Promotion?

4. Is there a difference in the level of job satisfaction between genders, among

positions or age, and years of service?

5. How much does it cost the company to make their employees satisfied with

their current job?

Hypotheses

The null hypothesis of this study is:

There is no significant difference in the job satisfaction levels of the

respondents when grouped according to:

1.1 Age;

1.2 Gender;

1.3 Civil Status;

1.4 Highest Educational Attainment;

1.5 Length of Service;

1.6 Present Position; and,

1.7 Monthly Salary.

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Scope and Limitation of the Study

The study is aimed to determine the level of job satisfaction of the

employees and its relationship to effective service. This study is limited to 88

employees of Social Security System Cubao. It does not include the contractual

employees, only the regular employees. The main concern of the study is focused

on the job satisfaction and performance of SSS employees in Cubao Branch. This

confinement is due to limited time and resources.

Significance of the Study

This study sought help the Branch manager/head and supervisors to

identify the problems that beset their employees. The result of this study would lay

out the information about what job aspects the employees are satisfied and what

aspects they are not satisfied. It would be beneficial to both the employees and the

Branch they are working to maintain a high degree of satisfaction for the Branch

to have a favorable performance. Maintaining a high degree of job satisfaction for

the employees is a must in every organization. The outcome of this study would

contribute to solve the problems that beset the SSS employees during

performance evaluation.

With respect to level of job satisfaction of employees, the results of this

study would provide some information on what aspects the employees are most

satisfied, and which aspects they are less satisfied. These information are worth

knowing for, so that both the employees and the employers can make several

steps to increase, if not, to maintain a high level of satisfaction and performance.

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 This research aimed to establish the relationship between the job

satisfaction and performance ratings in order to call the attention of the Branch

head/manager and supervisors as to the role of job satisfaction on the performance

of employees and somehow effect a change in their way of handling the

performance rating process.

This study would also help contribute additional information to serve the

following individuals:

Members. This study would help the members of the SSS. Because this

study aims to improve the performance of the employees, so that, in turn, SSS

employees would able to serve their members better.

Government. This study aims to determine the level of job satisfaction of

the SSS employees, which is a Government Owned and Controlled Corporation.

Therefore, the government would be able to know all problems that their

employees encounter, and for them to evaluate what they can do for the

employees.

Students. This study will help educate the students about what would be

the possible problem they would encounter in the future if ever they are planning

to work in SSS.

Researchers. This study will serve as reference for future researchers to

innovate, develop and widen the topic. This also encourage other researchers to

conduct as study about related topic of employees job satisfaction in other

companies and organization.

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Definition of Terms

The following terms are defined operationally in order to give clarity and

guidance on the study. Operationally, the terms presented below refers only to

SSS transactions.

Age. This pertains to the classification of the respondents as to age which

may fall under the following bracket: below 25 years old, 25-35 years old, 36-45

years old, 46-55 years old or 56 years old and above.

Civil Status. The status of the respondents which may be single, married,

separated, or widow/widower.

Contractual Employees. This refers to the employees hired by the SSS

that dont yet attain permanent employment; they only renew their contract every

six months depending on the assessment of their performance.

Employees Benefits. These are the things that an employee who works in

an organization is entitled to receive whether or not, he or she has a high

performance rating. (Kast, Fremont & Rosenzweig, James, 2005)

Gender. This refers to the classification of the respondent of being

masculine or a feminine.

Highest Educational Attainment. It identifies the highest educational

degree attained by the respondents from being high school graduate, bachelors

degree, masters units, masters degree, doctors units, or doctors degree.

Job Satisfaction. This refers to a pleasurable or positive emotional reaction

to a persons job experiences. (Milkovich and Boudreau,2004) It also refers to how

contented is the person in his present situation in his job.

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 Length of Service. This refers to the classification of respondents

according to length of service which may be less than 1 year, from 1 up to 5 years,

from 6 up to 10 years, from 11 up to 15 years, or more than 15 years.

Level of Performance. It is equal to degree effectiveness, efficiency and

participants satisfaction in carrying out duties and responsibilities. Also, it refers

to behaviors that are relevant to the organizations goals and can be measured on

term of each individuals proficiency, or level of contribution. (Wright and Noe,

2004)

Performance Rating. This refers to the score of the Level of Performance

of the employee. This serves as the basis in giving promotion and even incentives

for those employees who obtained a high performance rating. (Thor, 2004)

Position. This may be managerial, supervisory, or rank and file.

Privatization. This refers to an act of an organization to remove its

characteristic as a public servant. Privatized organizations are not anymore

controlled by the government.

Productivity Bonus. This refers to the benefit given to those employees

who obtained a high performance rating. This serves as one of the motivating

factor for every employee in the organization to work better. (Thor, 2004)

Productivity. This refers on how well the employee contributes to the

organizations operation. This is the measure of the performance of the company

to see whether they are operating effectively. (Thor, 2004)

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 Profile of the respondents. This consists of the age, sex, civil status,

highest educational attainment, length of service, current position and monthly

salary.

Promotions. This refers to the privilege given to every deserving and

qualified employee in an organization to improve his current position in the

organization and to increase his salaries and benefits. This is another motivating

factor for an employee to work even harder.

Public Service. This refers to the act of serving mass people, without

asking for a payment, or if payment is involved it is at a minimal cost. Most of the

public service organizations are subsidized by the government.

SSS. It means Social Security System. A GOCC or Government-Owned

and Controlled Corporation established to create a social security protection

program for workers in the Philippines.

Workforce. This refers to a very important attribute that an organization

needs to be able to survive and prosper. Without this attribute, an organization is

worthless.

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