Financial Constraints and Employee Satisfaction

Jing, Chenxing; Keasey, Kevin; Lim, Ivan; Xu, Bin

Abstract

Using over 120,000 employee reviews collected by Glassdoor between 2008 and 2015, we investigate whether firm financial constraints reduce employee satisfaction. We find that employee satisfaction is substantially lower in financially constrained firms. Decomposing employee ratings, we find that firm financial constraints are associated with employees’ concerns regarding work–life balance, senior leadership, and career progression. Our study implies that employee satisfaction could be an important channel through which financial constraints reduce firm value.

Citation

Jing, C., Keasey, K., Lim, I., & Xu, B. (2019). Financial Constraints and Employee Satisfaction. Economics Letters, 183, Article 108599. https://doi.org/10.1016/j.econlet.2019.108599

• Journal Article Type: Article
• Acceptance Date: Aug 5, 2019
• Online Publication Date: Aug 6, 2019
• Publication Date: 2019-10
• Deposit Date: Jul 27, 2020
• Publicly Available Date: Feb 6, 2021
• Journal: Economics Letters
• Print ISSN: 0165-1765
• Electronic ISSN: 1873-7374
• Publisher: Elsevier
• Peer Reviewed: Peer Reviewed
• Volume: 183
• Article Number: 108599
• DOI: https://doi.org/10.1016/j.econlet.2019.108599
• Public URL: https://durham-repository.worktribe.com/output/1265241
• Related Public URLs: http://eprints.whiterose.ac.uk/149797/