Personality and Pay Satisfaction: Examining the Relationship of a Sample of Blue Collar Workers Personality and Their Pay Satisfaction Levels

Abstract

Compensation plans are the tool that unites employers and employees together in one of the most important exchange processes that happens in organizations. Pay satisfaction is usually achieved when employees feel that they are being paid fairly compared to their referent others. It is desirable for organizations to enhance employee pay satisfaction because it can enhance productivity and commitment to the organization. This study addressed the pay satisfaction process by analyzing the relationship of personality and pay satisfaction. The mediator variables of amount realized and pay perceptions were also analyzed in the pay satisfaction and personality relationship. A sample of 251 blue collar workers was collected. Structural equation modeling was utilized to analyze these relationships. The results indicated that personality can have both a positive or negative relationship with pay satisfaction depending on the personality type. There was evidence that extraversion had a positive relationship with pay satisfaction, while conscientiousness, neuroticism and openness and a negative relationship with pay satisfaction. The study’s limitations and avenues for future research were addressed.