The influence of employability on employee performance and ...
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The influence of employability on
employee performance and employee
commitment and the effect of the type of
contract on these relations.
Director to HR manager: "What if we invest in our people and then they go away?
HR Manager: “What if we do not invest and they stay?”
Bachelor Thesis Human Resource Management
Author Amarins Nonhebel (848097)
Supervisor René Schalk
Project period January 2016 until May 2016
Abstract
Employability is a concept whose advantages, disadvantages and other consequences are still
ambiguous. The concept is often related to employee performance and employee commitment.
The question whether to stimulate employability or not is often debated in human resource
management. The so-called management paradox states that employability relates to positive
performance, but also to reduced commitment. This research examines this paradox. The theory
based hypotheses of this research state that the extent to which a manager promotes
employability stimulates employee commitment and employee performance. Moreover, the
relationship between employability and commitment was expected to be stronger and the
relationship between employability and performance was expected to be weaker for employees
with a temporary contract. Data to examine these relationships was gathered cross-sectional
and cross-national by administering questionnaires among 5345 respondents. The expectation
that employability leads to better performance and more commitment was confirmed within
this research. However, the expectation that the type of contract has an effect on these relations
was not confirmed within this research. Practical implications on the use of employability for
employee commitment and performance are discussed.
Keywords: employability, employee commitment, employee performance, type of contract,
social exchange theory, management paradox.
Introduction
Unemployment has been increasing in the European Union since 2008 as a result of the global
economic crisis. The figures for unemployment in the Netherlands are increasing from a total
percentage of 3.7 in 2008 to a total percentage of 6.9 in 2015 (Central Bureau for Statistics,
2016). In times of crisis and unemployment, employability is getting more important to prevent
unemployment. Employability is a concept of being capable of getting and keeping fulfilling
work (Hillage & Pollard, 1998) and it has received an increasing amount of attention over the
past years (Thijssen, van der Heijden, & Rocco, 2008). Lifetime employment used to be the
standard, but the labour market is changing and is becoming more flexible. When an employee
is employable, it increases the chance to find and keep a suitable job. In other words, the need
to be employable increases (Thijssen et al., 2008).
Besides the capability of getting and keeping fulfilling work, employability can be
described as the possibility to survive in the internal or external labour market (Thijssen et al,
2008). The question whether to stimulate employability or not is often debated in human
resource policy (De Cuyper & De Witte, 2011). On the positive side, employability leads to
positive outcomes for both career and firm (van der Heijde & van der Heijden, 2006).
Negatively, employability may increase the self-interest of employees (De Cuyper & De Witte,
2011). Hence, employability leads to the so called management paradox (van der Heijde & van
der Heijden, 2006). This paradox describes the idea that employability relates to performance,
but also to reduced commitment. The higher one’s employability, the higher one’s perception
about other available jobs which increases the change of employable employees taking another
job (van der Heijde & van der Heijden, 2006).
Based on the management paradox, this research will argue that employability leads to
a situation wherein employees are less committed but performance increases and that these
relations are dependent of the type of contract of the employee.
Employee commitment has often been related to employability (Fagiano, 1993;
Waterman, Waterman, & Collard, 1994; Iles, Forster, & Tinline, 1996; Estienne, 1997; Galunic
& Anderson, 2000; Craig, Kimberly, & Bouchikhi, 2002). Employee commitment is defined as
a strong belief in the organization's goals and values, a willingness to exert considerable effort
on behalf of the organization, and a strong desire to remain a member of the organization
(Mowday, Porter, & Steers, 1979). The relation between employability and employee
commitment has been studied several times, but it remains vague to what extent employability
influences employee commitment. Greater employability can both have a positive and negative
effect on employee commitment. Employability is beneficial for employees because of their
increased value, both on the internal and the external labour market (Schotman, 2012). For
employers, it is a risk to invest in employability when the value of their employees for other
companies will increase and their commitment to the organization will not increase at the same
time. This risk will not apply when an investment in the employability of employees leads to
more employee commitment of those employees (Schotman, 2012). Hence, employee
commitment is important on both the individual employee level and on the company
performance level. In fact, employee commitment has been recognized as one of the major
determinants of organizational effectiveness (Schein, 1970; Steers, 1975), higher levels of job
performance, lower absenteeism, and lower turnover (Mowday et al, 1979, 1982; Porter et al,
1976; Steers, 1977; Koch & Steers, 1978; Angle & Perry, 1980; Price & Mueller, 1983; Fukami
& Larson, 1984, as cited in Bush, Fallan & Petterson, 1998). Moreover, highly committed
employees report better well-being, including higher job satisfaction; better mental and physical
wellbeing (Siu, 2002).
The third variable from the management paradox (2006) is employee job performance.
Employee job performance is defined as the total expected value to the organization of discrete
behaviors that an individual carries out over a standard period of time (Motowidlo, 2003).
Employee job performance is a broad concept that also defines performance outside the core
activities, like performance in training programs, absence and creativity (Ng & Veldman, 2008).
The relationship between employability and performance can be explained through social
exchange mechanisms and reciprocity. The employer makes an effort to invest in employability,
and in turn the employee feels obliged to give something in return (de Cuyper & de Witte,
2011).
In addition to employability, employee commitment and employee job performance, the
influence of the type of contract (permanent and non-permanent) is investigated in this research,
as previous research showed that the type of contract can be of significant influence on the
relationship between employability and employee commitment (De Cuyper, Notelaers & de
Witte, 2009). De Cuyper, Notelaers and de Witte (2009) found a significant negative
relationship between employability and employee commitment for temporary workers, where
this was not significant for permanent workers. Little is known about the influence of the type
of contract on the relationship between employment and employee job performance, so there is
a possibility to extend this information. Therefore, the type of contract is included in this
research.
The aim of this research is to investigate the relationship between employability,
employee job performance and employee commitment and the role of the type of contract on
this relationship. Employability is an upcoming concept that is believed to have an influence
on both employee commitment and its multiple positive individual and organizational outcomes
and on employee job performance. The relationship between employability and employee
commitment is often investigated but a clear conclusion is still missing. Opinions are also
divided about the relationship between employability and employee job performance. It is still
unclear about the influence of type of contract on the relationship between employment and
employee commitment and the relationship between employment and employee job
performance.
Next to the scientific relevance of adding additional knowledge about this topic, this
study also has practical implications, since it will aid managers to make a decision about the
investment in employability. Employability can be both positive and negative in certain
situations and the type of contract could be a condition that will make the difference. For
managers, being able to make the right decisions will generate maximum benefit from the
positive consequences of employee commitment and will reach maximum employee job
performance. The result of this research will create broader and deeper knowledge about this
subject.
Thus, the research question is formulated as:
“To what extent is employability related to employee commitment and employee performance,
and how does the type of contract influence these relationships?”
The following section will argue the effect of employability on the commitment and
performance of employees and to what extent these relations are dependent of the type of
contract of the employee. After studying these relationships, four hypotheses will be
formulated. Lastly, the conceptual model will be presented.
The relationship between employability and employee commitment
Employability
According to Thijssen, van der Heijden and Rocco (2008), many different definitions are used
for employability. Generally, employability helps workers to survive on the internal and
external labour market by actively adapting to the changes on the labour market and the career
opportunities that arise (Fugate, Kinicki, & Ashfort, 2004) (Thijssen, van der Heijden, & Rocco,
2008). There are two forms of employability; internal and external employability (Schotman,
2012). Internal employability refers to the employees’ estimated chance of a better or different
job within the current organization, whereas external employability refers to the employee’s
estimated chance of a better or other job with another employer (Schotman, 2012). During the
past decades, the labour market changed and attention to employability has increased because
of this (Thijssen, van der Heijden, Rocco, 2008). Formerly, it was the standard for employees
to be employed at the same organization for a lifetime. However, organizations these days have
to deal with more and faster changes in and outside the organization than before. For this
reason, they are in need of flexible labour, which leads to a greater turnover in employees
(Baruch, 2001). Employability is a reaction to this new labour market. Instead of a stable
workplace and long-term commitment, an employer can now promise employability to his
employees, so they are more attractive for other employers when they have to leave the
organization which makes it easier to switch jobs (Baruch, 2001). Employees that are
employable can survive and satisfy current job demands and qualifications because of their up-
to-date knowledge and skills. (Thijssen, van der Heijden, Rocco, 2008).
Employee commitment
The concept of employee commitment has evolved over the years. Where Becker (1960, p.33)
described employee commitment as “the tendency to engage in consistent lines of activity
because of the perceived costs associated with leaving the organization,” Mowday, Porter, &
Steers (1982, p.26) defined the concept as “the relative strength of an individual’s identification
with and involvement in an organization” and made a distinction between attitudinal and
behavioral commitment. Two decades later, Siu (2002) made another division of the concept
and argued that employee commitment can be divided in three subjects: An acceptance of the
organization’s goals, a willingness to work hard for the organization, and the desire to stay with
the organization. This last definition will be used in this paper.
The social exchange theory
The relationship between employability and commitment can be explained through the social
exchange theory. The social exchange theory sees the relationship between employee and
employer as an exchange of interactions between multiple actors that are made in a state of
mutual interdepence that generate obligations (Blau, 1964) (Emerson, 1976). Thus, social
exchange theory explains that if one does something for you, you feel obliged to do something
for him in exchange, which balances each other out. When the employer invests in the
employability of his employees, this will have an effect on the exchange relation between
employer and employee as the employee will try to balance this relation by giving something
in return (Schotman, 2012). According to social exchange, a series of interactions between
employee and employer will evolve into trust, loyalty and mutual commitment (Cropanzano &
Mitchell, 2005). Thus, employees will repay their employers when they invest in employability,
through their level of commitment.
Previous research has found a positive influence of employability on employee
commitment. In a study conducted by Schotman (2012), it was concluded that internal
employability has a significant effect on employees’ affective commitment. This means that
employees who have a high estimated chance of another or better job at the same organization,
experience a higher emotional involvement and are more committed. Moreover, a study of
Benson (2006) stated that organizational and employee commitment was higher when spending
more days in an on-the-job training. Additionally, De Graaf, Peeters, & van der Heijden (2011)
stated that on-the-job training is a positive predictor for employability when the training is
attended in an adjacent area of expertise and in a study conducted by Benson (2006), on-the-
job training was found to have a positive effect on the employee commitment of employees.
The aforementioned leads to the following hypotheses:
H1: The more employable an employee is, the more committed to the organization he will be.
The effect of the type of contract on the relationship between employability and employee
commitment.
Types of contract
Most employees still have a full-time, open-ended employment contract, but the group of
employees with alternative employment options is growing (Bernhard-Oettel, Sverke, & de
Witte, 2005). Alternative employment options, that is other than full-time, exist in different
forms. First, there is fixed-term employment for the duration of a project or as a temporary
replacement. Secondly, there is temporary agency work where employees are involved in a
tripartite employment relationship: they are employed and hired out by the agency to perform
work at an organization. Thirdly, on-call employment where employees fill in short-term
vacancies for a limited number of hours or days (Bernhard-Oettel, Sverke, & de Witte, 2005)
(De Cuyper, Notelaers, & de Witte, 2009). This growth in temporary employment is related to
the emergence of boundaryless careers and a growing demand for career flexibility (Forrier &
Sels, 2003). This trend can be both positive and negative. On one hand, temporary employment
can be seen as a way of freedom for employees because they are not tied to one employer,
whereas it is also positive for organizations because it provides them with flexibility on the
labour market. On the other hand, temporary employment affects employees negatively in terms
of more job insecurity (De Cuyper, Notelaers, & de Witte, 2009).
Temporary work, employability and commitment
As a reaction to the growth in temporary work, more temporary employees will choose to invest
in employability to protect their labour market position since lifetime employment is no longer
the standard (Forrier & Sels, 2003). This may mean that employability is more related to
temporary workers compared to permanent workers (De Cuyper, Notelaers, & de Witte, 2009).
Temporary employees also have a higher exit probability and for this reason it can be expected
that temporary employment leads to under-investment in human capital from both the side of
the employer and employee (Forrier & Sels, 2003). Becker (1964) stated in his Human Capital
theory that both employee and employer are only willing to carry the costs of training if they
can recoup their training. Herefore, it is expected that employers are less willing to fund training
for their temporary employees and temporary employees are less willing to invest in training,
since the chance they can regain this investment with their current employer is small. Agency
workers, for example, are not employed by the company they work for, but at the agency office,
so their employer will be less inclined to invest in training. Long-term temporary workers will
get more access to training in comparison to short-term temporary workers, since their exit
probability is lower (Forrier & Sels, 2003). In addition, it is expected that temporary employees
with a good chance to move into a permanent job will receive more funded training in
comparison with their temporary co colleagues with a smaller chance at a permanent job
(Forrier & Sels, 2003). For this reason, it is expected that temporary employees participate less
in training than permanent employees and are therefore less developing their employability
(Forrier & Sels, 2003).
Along with the increase in temporary work, warnings about disadvantageous effects for
the individual arose. This development can be shown through the flexible firm model by
Atkinson (1984). This model states that temporary workers are associated with the
organization’s periphery and permanent workers with the core of the organization. The
periphery workers are the nonpermanent workers with no benefits and poor working conditions,
such as less job security and less opportunities for training and development. Their jobs are
designed for a quick and easy transfer of workers with minimal investment from the employer
(De Cuyper, Notelaers, & de Witte, 2009). In contrast, the core workers are crucial to the
organization and are therefore assigned to the most stable jobs with mostly a permanent
contract. (De Cuyper, Notelaers, & de Witte, 2009). This core – periphery model is assumed to
result in negative consequences for temporary employees, for example lower levels of job
satisfaction and lower levels of employee commitment (Mauno, Kinnunen, Mäkikangas, &
Nätti, 2005).
In conclusion, the type of contract can have different effects on the relationship between
employability and employee commitment. De Cuyper, Notelaers, and de Witte (2009) state that
employability is more related to temporary workers compared to permanent workers. Moreover,
Forrier and Sels (2003) expect temporary employees to participate less in training in
comparison with permanent employees which less develops their employability. Furthermore,
Mauno, Kinnunen, Mäkikangas and Nätti (2005) state that the core – periphery model results
in lower levels of employee commitment for temporary employees.
There is empirical evidence that shows that the type of contract influences the
relationship between employability and commitment, but there are few studies about
employability in relation to temporary and permanent experiences. Also, results and findings
of those few studies are contradictory (De Cuyper, Notelaers, & de Witte, 2009). For example,
De Cuyper, Notelaers and de Witte (2009) found a negative relationship between employability
and affective employee commitment for fixed-term contract workers and temporary agency
workers, but this relationship was not significant for permanent workers. In contrast, McDonald
and Makin (2000) found that nonpermanent employees were actually more satisfied with their
jobs and more committed to their organization than their permanent colleagues. However, De
Cuyper & de Witte (2006) did not find clear-cut differences between temporaries and
permanents on employee commitment.
The aforementioned leads to the following hypotheses:
H2: The relationship between employability and employee commitment is stronger for
employees with a temporary contract.
The relationship between employability and performance
Job performance is a central subject in organizational psychology. Viswesvaran and Ones
(2000) defined job performance as the scalable actions, behavior and outcomes that employees
engage in or bring about that are linked with and contribute to organizational goals. Job
performance is an important indicator in the hiring and selection process, as the employees who
are likely to perform better on the job are preferred and are more likely to get selected. Next to
that, training and assessment programs are designed to improve job performance (Viswesvaran
& Ones, 2000). \
The social exchange theory
The relationship between employability and job performance can be explained through social
exchange mechanisms. As explained before, social exchange theories involve reciprocity:
investments from one party are returned by investments from the other party. It defines an
exchange of a series of interactions between employer and employee; the employer makes an
effort to invest in employability, and in turn the employee feels obliged to give something in
return by delivering a better performance (de Cuyper & de Witte, 2011). Several studies have
confirmed this theory. For example, Van der Heijde and van der Heijden (2006) found that
employability is advantageous for both present performances on-the-job as well as career
outcomes, which is long-term performance. Moreover, Stoffers and van der Heijden (2009)
argued that stimulating and investing in employability is expected to contribute to
organizational performance.
Based on the assumptions mentioned above, on the relationship between employability and
employee job performance, the following hypothesis can be formulated:
H3: The more employable an employee is, the better his job performance will be.
The effect of the type of contract on the relationship between employability and employee
performance.
As mentioned before, there is a connection between type of contract and employability. De
Cuyper, Notelaers, and de Witte (2009) state that employability is more related to temporary
workers compared to permanent workers, Forrier and Sels (2003) expect temporary employees
to participate less in training in comparison to permanent employees and in this way less
developing their employability and performance. De Cuyper & de Witte (2006) did not find
clear differences between temporary workers and permanent workers on self-rated
performance. Pearce and Randel (1998) also found no differences between temporary and
permanent workers in their levels of job performance in their study with a small sample of
highly specialized contract workers. However, Ang and Slaughter (2001) did find a relationship
between type of contract and performance. They argued, based on a small Singapore sample of
information systems workers, that supervisors make a difference in the rating of performance
between temporary and permanent workers. In addition, Guest (2004) found that work
performance of temporary employees is rated lower than that of permanent employees
The aforementioned leads to the following hypothesis:
H4: The relation of employability and performance is weaker for employees with temporary
contracts.
Resulting from the aforementioned information, the following conceptual model can be
developed:
Figure 1. Conceptual model.
Method
Participants and procedure
This research had a cross-sectional and cross-national design and the population consisted of
employees of different participating countries. The requirements to participate in this research
were: 1) they had to have a permanent or temporary contract and 2) they had to work in one of
the following sectors: Food industry, Education or Retail. The following criteria for the choice
of sectors were used: Has to be present in all participating countries, a reasonable amount of
temporary employed employees can be found within the sector, sectors represent a broader class
of organizations and they are likely to be important in terms of future employment (de Cuyper,
de Witte, Rigotti, & Mohr, 2004). All respondents in the sample of this research (N=5345) met
these requirements and were used for the research. 62.7 percent of the respondents had a
permanent contract (n=3351) and 37.3 percent had a temporary contract (N=1993). There was
a small over-representation of female respondents, the number of male respondents was 2370
(44,3%) and there were 2906 female respondents (54.4%). The average age of the respondents
was 37,1 years (SD = 11.5 years).
Data was collected using surveys to employees. In order to collect data, the researchers
either visited the organizations, distributed and collected the questionnaires or sent the
questionnaires to the organizations and they then managed this process (de Cuyper, de Witte,
Rigotti, & Mohr, 2004). Because of the cross-national design, attention had to be payed to the
translation of the questionnaires. In this process the following steps were taken. First, there was
searched for existing tested versions of the instrument in the requested language. When there
was no suitable version available, the translation process started. In all national teams, at least
one translator was employed using translation / back translation as technique. This is the most
efficient translation technique, as it yields to high informativeness, and high source language
transparency (Behling & Law, 2000, as cited in de Cuyper, de Witte, Rigotti, & Mohr, 2004).
After this translation process, outcomes were discussed and translation errors were solved
together with the team. Before distributing the questionnaires, a small test was conducted with
at least five persons per country to find out if there were still any mistakes or ambiguities in the
questionnaire. It was stated beforehand that the respondents had to comply with the two
previously described requirements in order to be selected for analysis. Within the sample frame
of the three sectors, further specifications were established. In order to be selected for the
research sample, people had to work as a professional within the education sector or as a blue
collar worker doing tasks in the core business of food industry plants. It was also stated that the
minimum sample of each country should be 600 employees and the respondents should be
approximately equally divided between the three sectors. In order to ensure that one
organization did not had too much impact on the final results, it was stated that one organization
can not represent more than 33 percent of the sector. This is the same for the subgroups of
permanent and non-permanent workers. Furthermore, at least five employees should have a
non-permanent contract in one organization and at least seven organizations per country per
sector should be sampled. Therefore, in can be concluded that the sampling method in this
research was convenience sampling in combination with stratified sampling. Respondents were
selected due to their convenient accessibility due to the fact that companies and organizations
had to be willing to participate in this study. Further, each set of questionnaires had to match
certain strata, due to the equal deviation between the three sectors, between the employees with
the different types of contract and because of the limited impact of 33 percent per organization.
The data was derived on the employee- and employer level. The data was gathered over a period
of 33 months, starting in December 2002.
Measures
Employability was measured using the scale employability by de Witte (2000). This scale
consisted of five items. An example of an item that measured employability was: “I am
confident that I could quickly get another job at about the same pay, without having to move
house.” Respondents answers were rated on a five point Likert-scale (strongly disagree to
strongly agree). None of the items in the employability scale was reversed, because they were
all formulated in the same direction. From the factor-analysis and in accordance with the scree
plot, it was found that the scale employability consisted of one component with an eigenvalue
of 3.005 and a KMO of 0.831. In addition, a reliability analysis was performed and resulted in
a Cronbach’s alpha of 0.889, which implies that the reliability was good. All items contributed
to the reliability.
Organisational commitment was measured using the employee commitment scale by
Cook and Wall (1980). This scale consisted of five items. An example of an item that measured
employee commitment was: “I feel myself to be part of the organization.” Respondents answers
were rated on a five point Likert-scale (strongly disagree to strongly agree). None of the items
in the employability scale was reversed, because they were all formulated in the same direction.
When factor analysis was performed, it was found that the scale organisational commitment
consisted of one component with an eigenvalue of 2.297 and a KMO of 0.771. The scree plot
confirmed this finding. In the reliability analysis, a Cronbach’s alpha of 0.679 was reported.
One item did not contribute to the reliability. When this item would be deleted, Cronbach’s
alpha would be 0.718. However, the results from the factor analysis show that this item is
contributing to the component of organisational commitment with a score of .437. For this
reason, it was decided to keep the item in the scale.
Performance was measured using the scale perceived performance by Abramis (1994).
This scale consisted of six items all starting with: “In your own judgement, how well did you
fulfil the following tasks?” An example of an item that measured performance was:
“Perform without mistakes?” Respondents answers were rated on a five point Likert-scale (very
badly to very well). From the factor-analysis and in accordance with the scree plot, it was found
that the scale performance consisted of one component with an eigenvalue of 2.891 and a KMO
of 0.801. During the reliability analysis, a Cronbach’s alpha of 0.784 was found and all items
contributed to this scale.
Type of contract was measured using the scale type of contract by Psycones (2007).
Respondents had to answer the following item: “Do you have a permanent contract with this
organization?” In this research, the only distinction is been made between respondent without
a permanent contract (no = 0) and with a permanent contract (yes = 1).
Four control variables were added to the existing model, to investigate whether these
variables influenced the relationships in the original model. These variables were gender, age,
educational level and intention to quit.
Firstly, Gender. Respondents had to answer the following item: “Are you…” where the
answer could be female or male. Hereby the number of males and females could be identified
and these numbers could then be used to control for gender. This variable was a dummy
variable, where the value 0 was for female and the value 1 for male. The influence of gender
on employee commitment is researched before. Marsden, Kalleberg and Cook (1993) found
that men tend to have slightly higher overall levels of employee commitment than women. Here
fore, gender was chosen as a control variable.
Secondly, Age. To find out what age the respondents were, they had to answer the item
“What is your age?” For analysis, this item was centred on zero. The choice of age as a control
variable was made because age and employability are often associated with each other in other
research. For example, Machielsen (2015) studied the influence of age on job crafting and found
that as people age they are less likely to craft by increasing demands, which decreases
engagement and employability.
Thirdly, Education. This question was different for every country, because every
country had to look for a measurement that could be transformed to the ISCED classification
of educational levels from 1 to 6. In this way, it was possible to measure results between
different countries, despite the different educational systems. This control variable can be
important for this research because it can have effect on type of job and the position in an
organization and therefore also on performance, employability and commitment.
Lastly, intention to quit. This concept was measured using the scale intention to quit by
Price (1997). The scale consisted of four items. An example of an item that measured intention
to quit was: “These days, I often feel like quitting.” Respondents answers were rated on a five
point Likert-scale (strongly disagree to strongly agree). One item in the intention to quit scale
was reversed, because it was formulated in a different direction than the other items that
measured this variable. For analysis, this item was centred on zero. This control variable was
chosen because previous research found a negative relation between intention to quit and
commitment (Loi, Hang-Yue, & Foley, 2006). It was striking to see that more than half of the
respondents (52.8%) answered very low on this scale with 1.00, 1.25 of 1.50.
Analysis
Employee commitment and performance were both regressed on employability and with an
interaction effect of type of contract with multiple regression analysis. Multiple regression
analysis was applied to the variables to test for significance and correlations.
Results
Descriptive results
In Table 1 the correlations, means and standard deviations of the variables are presented.
Employability was shown to have a significant positive relationship with performance (r = .096
, p < .01) . The positive relationship (r = .019) between employability and employee
commitment was not significant. Type of contract was shown to have a positive significant
relationship with both performance and employee commitment (r = .066, p <0.01; r = .079, p <
0.01), this means that employees with a permanent contract scored higher on performance and
employee commitment than employees without a permanent contract. This assumption is
checked and confirmed with a T-Test. Permanent employees had an average score of 4.07 (SD
= .51) on performance where temporary employees scored 4.00 (SD = .53). Permanent
employees also scored slightly higher on employee commitment with an average of 3.84 (SD
= .66) where temporary employees scored 3.73 (SD = .72). Type of contract and employability
were not significant related (r = -.017).
When considering the control variables, gender was not shown to have any significant
relationships, except for the positive relationship with type of contract (r = .029, p < 0.05). This
statement was tested with the Chi-Square test (p < 0.05). From all women, 61,36% has a
permanent contract where this is for men 64,20%. There is no credible evidence that there is a
difference between men and women on their level of performance or employee commitment by
employability. Age has significant effects on employee commitment (r = .165, p < 0.01),
performance (r = .121, p < 0.01), employability (- 0.207, p < 0.01) and the type of contract (r =
.329, p < 0.01). This suggest that when an employee gets older, he gets more committed, his
performance gets better, his employability decreases and the change that the employee has a
permanent contract gets higher. Educational level has a significant effect on employability (r =
.114, p < 0.01), gender (r = -.086, p <0.01) and age (r = .037, p < 0.01). In other words,
employees with higher education are expected to be more employable, older and men are higher
educated than women. Lastly, intention to quit has significant effects on employee commitment
(r = -.545, p <0.01), performance (r = -.253, p < 0.01), employability (r = .112, p < 0.01), type
of contract (r = .071, p < 0.01), age (r = -.081, p < 0.01) and educational level (r = 0.030, p
<0.05). This suggest that employees who are more intended to quit are less committed to the
organization, their performance gets worse, they are more employable, they are more likely to
have a permanent contract , they are younger and they are expected to have a higher educational
level. Only the correlation between employee commitment and intention to quit was strong
according to the criteria stated bij Pallant (2007), as a strong correlation should lie between .5
and 1.0.
All the variables presented in Table 1 were included in the regression analysis. The
variables were included to determine whether they have an effect on the assumed moderation
of type of contract on the relationship between employability and employee commitment and
the relationship between employability and performance.
Table 1.
Means (M), standard deviations (SD) and correlations (N=5345)
M SD 1 2 3 4 5 6 7 8
Employee
commitment¹
3,79 ,68 -
Performance¹ 4,04 ,52 ,360** -
Employability¹ 3,17 1,05 ,019 ,096** -
Type of
contract²
,63 0,48 ,079** ,066** -,017 -
Gender³ ,45 ,50 ,009 -,016 -,010 ,029
*
-
Age4 37,1
0
11,47 ,165** ,121** -
,207**
,329
**
,021 -
Educational
level5
4,14 1,52 ,001 -.026 ,114** .002 -
,086**
,037** -
Intention to quit¹ 1,84 ,90 -,545** -.253** ,112** .071
**
,013 -,081** ,030* -
**.Correlation is significant at the 0.01 level (2-tailed).
*. Correlation is significant at the 0.05 level (2-tailed).
¹ Measured on a 5 point likert-scale
² 0 = without permanent contract, 1 = with permanent contract
³ 0 = female, 1 = male 4 Measured as a continuous variable in years 5 Measured on a scale from 1 to 6
Testing the hypotheses
Using a multiple regression the hypotheses stated in this research were tested (Table 2).
Beforehand, there was checked for homoscedasticity using a scatterplot with the result that the
assumption of homoscedasticity was violated.
The first hypothesis was: The more employable an employee is, the more committed to
the organization he will be. This hypothesis was supported by the regression analysis, because
employability was shown to have a positive effect on employee commitment. However, this
effect was very small as you can see from the Beta and the explained variance. (β = .070, p <
0.001,). Model 2 showed an R2 change of .323. The explained variance (adjusted R square) was
.324 where 0.314 was explained by the control variables and only .011 by employability. The
part of the explained variance of employee commitment that is explained by employability was
significant, the effect from employability on employee commitment is significant. p <0.001.
The second hypothesis was stated as follows: The relationship between employability is
stronger for employees with a temporary contract. This hypothesis was not supported by the
regression analysis. Type of contract did have a positive significant effect on employee
commitment (β = .105, explained variance = .328, p < 0.001) which means that employees with
a permanent contract score higher on employee commitment. However, the interaction effect
was not significant. Model 3 showed an R2 change of .328. The part of the explained variance
of employee commitment that is explained by employability and type of contract was
significant, p < .001. However, the decreased influence of employability (β = .07 in model 2
and β = .06 in model 3) when adding type of contract to the model suggest that there is overlap
between these variables. The adjusted r square, which is the explained variance, is .328 where
only .005 is explained by model 3.
The third hypothesis was: The more employable an employee is, the better his job
performance will be. This hypothesis was supported by the regression analysis, because
employability was shown to have a positive effect on performance. However, again the effect
was very small as you can see through the beta and the explained variance (β = .077, p < 0.001,).
Model 2 showed an R2 change / explained variance of .099. The part of the explained variance
of organizational performance that is explained by employability was significant, p <0.001.
The last hypothesis was stated as: The relation of employability and performance is
weaker for employees with temporary contracts. This hypothesis was not supported by the
regression analysis. Type of contract did have a negative significant effect on performance (β
= .050, p < 0.01) which suggest that employees without a permanent contract would perform
better on-the-job. However, the interaction effect was not significant. Model 3 showed an R2
change of .100. The part of the explained variance of organizational performance that is
explained by employability and type of contract was significant, p < .001.
Table 2.
Regression analyses (N = 4756)
Model Organisational commitment Performance
1 2 3 1 2 3
β β β β β β
Gender .015 .014 .012 -.020 -.021 -.022
Age .007** .009** .007** .005** .006** 0.006**
Education .005 -.001 - 3.388E-5 -.008 -.015* -.015*
Intention to quit -.402** -.410** -.415** -.138** -.146** -.148**
Employability .070** .060** .077** .076**
Type of contract .105** -.050*
Type of contract
x Employability
.012 -.001
R2 31.3% 32.4% 32.9% 7.6% 10.0% 10.2%
∆ R2 .323** .328** .099** .100**
F 553.679
**
466.191
**
340.516** 99,77** 106,65** 77,80**
**p<0.001
* p<0.01
Discussion
In this study the following research question was examined: ““To what extent is employability
related to employee commitment and employee performance, and how does the type of contract
influence these relationships?” The results indicate that employability positively influences
employee commitment and performance. Furthermore, analyzes showed that type of contract
does not significantly influence these relationships. However, there where significant direct
effects from type of contract on employee commitment and performance.
These results were not in line with the expectations beforehand. The design of this study
was based on the management paradox (van der Heijde & van der Heijden, 2006), that explains
how employability reduces commitment and increases performance. However, this research
found that employability leads to both increased commitment and performance. A reason for
the unexpected findings can be that the concept of employability used in the management
paradox is too general. When performing research about employability, different aspects should
be taken into account. A distinction should be made between internal and external labour
markets because of the different results for these different labour markets. In addition, there
should be a difference between opportunities for all jobs, which is a quantitative measure, and
opportunities for desired jobs, which is a qualitative measure (De Cuyper & De Witte, 2011).
Because of these distinctions in labour market and available job opportunities, the concept of
employability has several definitions depending on various situations. Employability as one
concept is too comprehensive since the different kinds of employability can be different
predictors for performance and commitment.
The social exchange theory assumed that employability leads to higher employee
commitment (hypothesis 1) and that interactions between employer and employee are based on
reciprocity (Cropanzano & Mitchell, 2005). Previous research by Schotman (2012) found that
internal employability positively influences affective commitment. This hypothesis was
supported by the findings in this research, although the effect was very small. In this research,
the social exchange theory has proven to be a good predictor for the relationship between
employability and employee work engagement. The more an employer invests in employability
of his employees, the more the employee will repay his employer through his level of
commitment.
Subsequently, it was hypothesized that the relationship between employability and
employee commitment is stronger for employees with a temporary contract (hypothesis 2). De
Cuyper, Notelaers and de Witte (2009) found a negative relationship between employability
and affective employee commitment for fixed-term contract workers and temporary agency
workers, but this relationship was not significant for permanent workers. These findings do not
correspond to the outcomes of this research. There was no significant result found for the
interacting effect of type of contract on the relationship between employability and employee
commitment, herefore the hypothesis was not confirmed by the results of the analyses.
However, it was confirmed that employees with a permanent contract score higher on employee
commitment. These findings are not consistent with existing research, for example von Hippel,
Magnum, Greenberger, Heneman and Skoglind (1997) found that those individuals who hope
to gain a permanent job were more committed to the employer than those who were not hoping
for a permanent contract. A possible explanation for these outcomes could be the fact that most
employees with a temporary contract are not hoping to get a permanent job in the end.
Third, it was assumed from the social exchange theory that employability leads to higher
performance (hypothesis 3). The employer makes an effort to invest in employability, and in
turn the employee feels obliged to give something in return by delivering a better performance
(de Cuyper & de Witte, 2011). Previous research has confirmed this theory. For example,
Stoffers and van der Heijden (2009) argued that stimulating and investing in employability is
expected to contribute to organizational performance. The hypothesis was confirmed by the
analyses in this research with a small positive effect of employability on performance. The
social exchange theory was a good predictor for this relationship.
Finally, it was hypothesized that the relation of employability and performance is
weaker for employees with temporary contracts (hypothesis 4). Forrier and Sels (2003) expect
temporary employees to participate less in training in comparison with permanent employees
and in this way less developing their employability and performance. Guest (2004) stated that
work performance of temporary employees is rated lower than that of permanent employees.
The hypothesis was not supported by the results of the analysis. There was no significant result
found for the interacting effect of type of contract on the relationship between employability
and performance. However, type of contract did have a negative significant effect on
performance which suggest that employees without a temporary contract would perform better
on-the-job. This result is in line with existing literature, for example Forrier and Sels (2003)
expect temporary employees to participate less in training in comparison to permanent
employees and in this way less developing their employability and performance. Therefore it
can be expected that permanent employees would perform better on the job.
A setback in this study was the fact that no significant result was found for the effect of
the type of contract on the relationships between employability and commitment and
employability and performance. A possible explanation for this is the fact that while there exist
many forms of alternative employment, they have been studied as one group in comparison
with permanent employment in this research.
Limitations and suggestions for future research
This research had some limitations, which can be used as suggestions for future research. Data
was gathered using paper and pencil surveys. By using a questionnaire, the chance on social
desirable answers increases. Employees had to score themselves with a questionnaire on the
variables employability, commitment and performance. Consequently, there is a change that
employees do not want to admit that they are not employable, committed or performing badly
and therefore scores might be higher than they really are. Therefore, it is suggested that for
future research these variables will not only be measured by the individual themselves, but also
by the use of colleagues or supervisors opinions which decreases the effects of social
desirability and increases the validity of the research (Van Der Heijde & Van Der Heijden,
2005).
As mentioned before, it is suggested for future research to make a distinction in the types
of temporary contracts and to make a distinction in the types of employability while studying
this subject. Both concepts are comprehensive and this can cause errors in research when using
them as one concept instead of seeing the concept as a set of different sub components.
This study has a cross sectional design where data was gathered at one specific moment
in time. The downside of this is that no assumptions about causality can be made which means
that it cannot be concluded that a more employable employee will be more committed or will
perform better, since it can only be stated that these variables influence each other. Future
research might conduct longitudinal studies with multiple moments of testing in a longer time
frame. In that way, conclusions about causality can be made.
During the analysis, homoscedasticity was violated. This violation can lead to an
underestimation of the results.
Subsequently, the sampling method can be discussed. The sampling method used in this
research was convenience and stratified sampling. This implies that respondents were
approached based on ease of access. For this reason, the results of this study need to be
interpreted with caution since this study is not randomly conducted. The validity of this research
can be increased by the use of a random sample.
Next to that, it is recommended to increase the number of items that measure a variable.
In this research, some scales consisted of only four questions to measure a variable. Moreover,
future studies also need to incorporate casual workers to a higher degree and perhaps other
sectors.
Practical implications
This study has some practical implications that could contribute to the field of HR and the
performance of organizations and employees in the future. The two interviews with managers
revealed that employability is an increasingly important concept in nowadays business. Because
of the continuous changes in organizations, managers need employees who can adapt to this
continuous flow of movement and change in order to succeed. Employable employees are
becoming more needed and more important. Employees who can only perform one specific task
and do not want or are not able to learn anything else are becoming less valuable.
The increase of employability is likely to positively influence employee commitment. In earlier
research, committed employees are related to different positive outcomes, such as
organizational effectiveness, improved performance and improved well-being. The increase of
employability is also likely to positively influence performance. Therefore, employability is
beneficial for the organizational performance, individual performance and individual well-
being. It can be stated that increasing employability is an investment to consider for the
employer, as it can lead to these positive outcomes. It can be beneficial for organizations,
employers and employees to invest in employability. Human Resource Departments should
focus on the employability of their employees. For example, they should invest in training and
development in order to keep their employees up to date and ready for changes.
This study implies that employability could have many beneficial organizational
outcomes like increased employee commitment and better performance, employers across
countries and organizations could improve their performance by trying to invest in the
employability of their employees.
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Appendixes
Appendix 1 –Summary interviews Bachelor thesis
For my bachelor thesis I interviewed two employees. The first interviewed employee was
team manager expertise and advise at the big insurance company Univé. He managed a team
of 20 employees. The second interviewed employee was team manager culture and sport at
the municipality Steenwijkerland. She managed a team of 5 employees.
First, I explained the subject of my research. I explained the concept employability and I
explained my research question: “To what extent is employability related to employee
commitment and employee performance, and how does the type of contract influence these
relationships?”
They both expect that employability leads to more performance and more commitment. They
also expect that employees with a temporary contract will try harder to improve their
performance, in order to stand out in a positive way in comparison with employees with a
permanent contract. They expect a stronger relationship between employability and
performance for temporary employees and a stronger relationship between employability and
commitment for employees with a permanent contract.
When I ask for practical examples, they mostly start talking about the fact that permanent
employees are often reluctant to change. They experience employees with a permanent contract
as passive employees who find it difficult to adapt to changes in the organization. Those people
are less employable than people with a temporary contract who have an active attitude and are
open for changes.
They argue that organizations need different people nowadays. The manager at Univé has a
quote they use to explain this statement. ‘Panta Rhei’. This means everything flows, everything
is always moving and changing. To succeed as an organization, you need employees who can
adapt to this continuous flow of movement and change. Employable employees are getting more
needed and more important. Employees who can only perform one specific task and don’t want
to learn anything else are becoming less valuable. There is no place for static jobs anymore.
We can conclude that employability is an important issue for companies nowadays, as
employable employees can adapt to all the changes the company is experiencing.
The interview at the municipality Steenwijkerland ends with an applicable quote: Stel dat we
investeren in onze werknemers en ze vertrekken? Maar stel dat ze het niet doen, en ze blijven.
Translated as: "What if we invest in our people and then they go away? What if we do not
invest and they stay?” I found this quote so relevant to my research that I decided to use it as a
subtitle.
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