Impact of extrinsic rewards on job satisfaction of banking sector employees

Abstract

This paper explores the effect of extrinsic rewards on job satisfaction upon employees of the banking industry in Kathmandu Valley. This is because the objectives of the study are to identify intrinsic rewards, assessing the correlation between extrinsic rewards and job satisfaction, and examining the effect of extrinsic rewards that include salary pay, bonuses, fringe benefits, and promotion. A descriptive and analytic research design was embraced with the use of primary data of 390 respondents who were purposely sampled using a structured Likert-scale questionnaire. The correlation and regression were used in the analysis. Results showed that there were high levels of satisfaction on salary, bonuses, fringe benefits, and promotion, and the grand means were more than 4.30 with low standard deviations implying that there was consistency in the responses. Nevertheless, correlation analysis showed that fringe benefits only showed statistically significant yet weak negative correlation with job satisfaction. This result was confirmed by regression analysis, which indicated a borderline significant and weak negative significant effect of fringe benefits, and no significant effect of salary, bonus, and promotion. These findings indicate that extrinsic rewards cannot be an important determinant of job satisfaction.