The impacts of monetary rewards on public sector employees: a case of Jigawa State in Nigeria

Abstract

Purpose Literature indicates that monetary reward or compensation impacts on the level of attraction, motivation, job satisfaction and retention of employees. The elements of compensation include salary, bonuses (allowances), gratuity and pension. The study investigated how these four elements of compensation specifically influence the attraction, motivation, job satisfaction, and retention of public sector construction employees of Jigawa State of Nigeria to inform how their employer can raise the current levels of satisfaction and retention of employees. Design/methodology/approach The Positivist paradigm guided the empirical research where a questionnaire was developed, pilot-tested and administered to 265 people using stratified random sampling. A total of 260 questionnaires were collected, representing a response rate of 98%. The data obtained was analysed using both descriptive statistics and Structural Equation Modelling. Findings The results established that construction employees in Jigawa State’s public sector were motivated by allowances and gratuity, attracted to the job by salary, pension and gratuity, and remained in their jobs through the influences of gratuity and pension. Gratuity played a major role as it impacted on all the 4 variables studied. Practical implications These findings are applicable to Jigawa State of Nigeria, but can be extrapolated to other public sector construction employees in the whole country. The findings could also be generalized in other States where the pay scales are different within the ministries. Originality/value The impacts of 4 elements of monetary rewards on 4 employees’ variables were studied. The specifics of which elements of compensation influence the employees of Jigawa State’s Ministry of Works and Transport have been identified. The findings from this study showed that gratuity played a primary role as it impacted highly on all the 4 variables of job attraction, motivation, satisfaction and retention. Pension also played a high role as it impacted heavily on job attraction, satisfaction and retention. Comparatively salary and allowances had high impact on one variable each: job attraction and motivation respectively.