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ER
26,2 Work motivation and job
satisfaction in the Nordic
122
countries
Jacob K. Eskildsen and Kai Kristensen
Received March 2002 Center for Corporate Performance, The Aarhus School of Business,
Revised June 2003 Aarhus, Denmark, and
Accepted July 2003
Anders H. Westlund
The Stockholm School of Economics, Stockholm, Sweden

Keywords Job satisfaction, Motivation (psychology), Denmark, Sweden, Norway, Finland

Abstract This paper studies differences in job satisfaction and intrinsic work motivation between
employees with different characteristics. Based on a study of the literature assumptions regarding
these differences are developed and tested on data from a survey in the Nordic countries. In this
survey 9,623 employees from randomly selected households in the Nordic countries participated.
Among the findings are that Danish workers were found to be the most satisfied and that there is
no difference between the genders with respect to job satisfaction in the Nordic countries.

Introduction
The world market is becoming an increasingly complex place in which to
operate for today’s businesses putting up new demands for corporate
information systems. Most information systems are based solely on accounting
data and thus insufficient with respect to describing the company’s general
situation and future financial health (Kaplan and Norton, 1996). The
information systems of the future will include measures of intangibles such
as customer and employee/job satisfaction since these intangibles are in
account for more than half of the book value in most industries in both the USA
and Europe (Kaplan and Norton, 1996; Kristensen et al., 2002). These future
information systems will require standardised methods for measuring
intangibles (Kristensen and Westlund, 2001) and this is already well
underway in the field of customer satisfaction through national indices such
as ACSI in the USA and EPSI Rating in Europe.
Less has happened in the field of job satisfaction with respect to developing
standardised measuring methods (Kristensen and Westlund, 2001) and most of
the studies done on job satisfaction and intrinsic work motivation are limited to
specific countries or even specific organisations. As a consequence these
Employee Relations studies report different and sometimes contradictory findings with respect to
Vol. 26 No. 2,
pp. 122-136
the effect that employee characteristics such as gender, age and educational
q Emerald Group Publishing Limited
0142-5455
level have on intrinsic work motivation and job satisfaction (Finlay et al., 1995;
DOI 10.1108/01425450410511043 Clark et al., 1996; Miles et al., 1996; Ganzach, 1998; Robie et al., 1998; Gaertner,
1999; Groot and Maasen van den Brink, 1999; Sousa-Poza and Sousa-Poza, Work motivation
2000). and job
The aim of this paper is therefore to study the literature and test satisfaction
assumptions regarding the differences in intrinsic work motivation and
employee/job satisfaction among employees with different characteristics. This
analysis will focus on the following demographic and other categories:
123
.
country of origin;
.
gender;
.
age;
.
managers vs employees;
. educational level; and
.
company size.
The data for this analysis stem from The Nordic Employee Indexe, which is a
recent attempt to develop a standardised way to measure job satisfaction. The
Nordic Employee Indexe was launched in August 2001 as a joint project
between the two independent market research companies MarkedsConsult A/S
and CFI Group and is based on approximately 9,600 responses form Denmark,
Norway, Sweden and Finland.

The effect of employee characteristics

As stated above most of the studies done on intrinsic work motivation and job
satisfaction are limited to specific countries or even specific organisations. As a
consequence these studies report different and sometimes contradictory
findings with respect to the effect of employee characteristics on intrinsic work
motivation and job satisfaction. Some studies have tried to include counties
from different parts of the world and in one of these studies most of the Nordic
countries were included (Sousa-Poza and Sousa-Poza, 2000). This study
covered a total of 15,324 employees from 21 countries and the results showed
that Denmark was ranked number one in terms of job satisfaction and Sweden
and Norway were ranked as number 9 and 10 respectively. Based on this result
the following assumption A1 will be tested in the following:
A1. Danish workers are more satisfied than workers from the other Nordic
countries.
Apart from cultural differences, age is another employee characteristic often
thought to affect the level of job satisfaction. Many studies have studied this
phenomenon and it is often observed that age differences in job satisfaction are
greater than those associated with for instance gender or education (Clark et al.,
1996). One of the most recent studies was conducted in the UK on a random
sample of more than 5,000 employees (Clark et al., 1996). Here the relationship
between age and satisfaction was found to be u-shaped but this relationship
ER does not hold true for the US labour market. Here low levels of job satisfaction
26,2 among young employees have typically been observed (Clark et al., 1996).
The Nordic labour market is considered more similar to the UK labour
market than the US labour market. This is due to the fact that EU legislation
concerning labour-related issues is applying in both the UK and the Nordic
countries.
124 Therefore the relationship between age and job satisfaction is assumed to be
u-shaped in the Nordic countries as well. Although the effect of age on job
satisfaction is accepted this is not necessarily the same for intrinsic work
motivation. One study has reported no effect from age on intrinsic work
motivation (Howard and Frink, 1996), but generally job satisfaction and
internal work motivation are found to be related (Howard and Frink, 1996; Eby
et al., 1999; Lu, 1999; de Jonge et al., 2001), and therefore the relationship
between age and internal work motivation is also assumed to be u-shaped. The
following assumptions A2 and A3 will be tested in subsequent chapters:
A2. The relationship between age and job satisfaction is u-shaped.
A3. The relationship between age and intrinsic work motivation is
u-shaped.
Gender is another employee characteristic which is often found to cause
variations in reported levels of job satisfaction (Clark et al., 1996; Sousa-Poza
and Sousa-Poza, 2000). Many studies have confirmed these differences and in
most of these studies it turned out that women were more satisfied than men
(Clark et al., 1996; Sousa-Poza and Sousa-Poza, 2000; Wharton et al., 2000;
Kalleberg and Mastekaasa, 2001). There have been many suggested
explanations to this phenomenon ranging from genetic differences to an
overrepresentation of women with part-time jobs. Based on these studies
employees in the Nordic countries are expected to report similar differences in
job satisfaction with respect to gender and the assumption A4 to be tested on
the data countries is therefore:
A4. Women are more satisfied with their job than men.
The first two employee characteristics dealt with gender and age but studies
have also shown differences in reported job satisfaction with respect to other
demographic characteristics. Educational level, especially, has been found to
affect the level of job satisfaction and in many studies job satisfaction has been
found to decrease with increasing educational level (Clark et al., 1996; Robie
et al., 1998; Sousa-Poza and Sousa-Poza, 2000; Wharton et al., 2000). In one
study the effect of educational level of on intrinsic work motivation was in
focus but no significant relationship was found (Howard and Frink, 1996). This
has led to the following assumptions A5 and A6 regarding the relationship
between educational level and job satisfaction as well as intrinsic work
motivation:
 A5. Employees with a high education are less satisfied. Work motivation
A6. Educational level has no impact on intrinsic work motivation. and job
satisfaction
The last group of assumptions deal with more organisational characteristics of
the employees. The previously mentioned study from the UK found that
managers reported higher levels of job satisfaction than regular employee and
this phenomenon has also been found in other studies (Clark et al., 1996;
125
Howard and Frink, 1996; Robie et al., 1998; Kalleberg and Mastekaasa, 2001).
Furthermore job satisfaction was found to be negatively related to company
size. This has led to the following assumptions A7 and A8 that will be tested in
the following:
A7. Managers are more satisfied than regular workers.
A8. Job satisfaction decreases with company size.
The eight assumptions developed above will be tested in the following but first
the sampling and the methodology of the study will be described.

The Nordic Employee Indexe

The Nordic Employee Indexe is based on a general model for employee
satisfaction, motivation and loyalty. The model, which is shown in Figure 1,
captures employee satisfaction, motivation and loyalty based on the
corporation’s or organisation’s image, senior management, immediate
superior, co-operation, and work conditions (which includes salary, work
tasks and professional and personal development opportunities).

Figure 1.
The conceptual model
behind The Nordic
Employee Indexe
ER The model rests on a solid foundation of academic research in the field (Baker,
26,2 1995; Allen and Meyer, 1996; Eby et al., 1999; Gaertner, 1999; Clark, 2001; de
Jonge et al., 2001; Eskildsen et al., 2002) and is thought to provide a generic
approach to employee satisfaction measurements that can be applied in any
organisational setting. The way in which the seven constructs has been
operationalised is shown in Table I were the items for each construct are
126 shown.
The focus of the following section is on the data used for testing the
conceptual model and the eight assumptions previously developed.

Sampling
The data for The Nordic Employee Index were collected in August 2001
through a postal survey. A total of 85,000 questionnaires were sent to
employees in the Nordic countries; 20,000 in Denmark, 25,000 in Sweden; 20,000
in Norway and 20,000 in Finland. The questionnaire contains generic questions

Construct Items

Image Overall image

Corporate leadership
Immediate manager
Cooperation
Conditions of work
Motivation and satisfaction
Loyalty
Table I.
Construct items
Proud to tell
Perception of others
Overall evaluation
Ability to make right decisions
Ability to inform employees
Corporate ethics
Overall evaluation
Professional skills
Leadership skills
Professional cooperation
Climate
Social belonging
Job content
Work environment
Pressure
Pay and benefits
Job security
Attention to professional and personal development
Overall satisfaction
Comparison to ideal
Feel motivated
Look forward to go to work
Intend to stay
Looking for another job
Recommendation to friends
Willingness to change
Willingness to do extra effort
Colleagues think I do well
that can be answered by any employee irrespective of industry, education etc. Work motivation
The survey also contains a number of demographic and other questions such and job
as age, education, size of company and whether or not the respondent holds a satisfaction
managerial position. The questionnaires were sent to randomly selected
households in the Nordic countries. The selection in Denmark and Norway was
based on the telephone companies’ database of fixed-line customers. In Sweden
and Finland the selection was based on the national register. In order to fill in 127
the questionnaire the respondent had to meet the following criteria:
.
be employed, but not self-employed;
.
work at least 25 hours a week for the same employer; and
.
be at least 18 years old.
If several members of the household fulfilled the criteria, the person whose
birthday passed most recently was asked to complete the questionnaire. About
9,600 responses were collected, of which there were about 2,650 in Denmark,
2,050 in Norway, 1,900 in Sweden and 3,000 in Finland. The response rate is
11.3 per cent but since a substantial amount of the Nordic households do not
have people that fulfil the criteria above, the response rate is considerably
higher in reality. All in all, the response rate is perceived as satisfactory.

Methodology
There are quite a number of statistical techniques that can be applied for
testing causal relationships but the method used to estimates the model behind
The Nordic Employee Index is partial least squares (PLS). The reason for this
choice is that the focus of the study is on predicting employee loyalty and PLS
is a technique well suited for this purpose (Jöreskog and Wold, 1982) since it is
not sensitive to skewed distributions, multicollinearity and misspecifications in
the model as other structural equation modelling techniques (Cassel et al.,
1999). The PLS model consists of three parts: inner relation, outer relations, and
weight relations (Wold, 1980; Fornell and Cha, 1994). The inner relations depict
the relations between the latent variables as shown in equation (1):
h ¼ Bh þ G j þ z : ð1Þ
Here h is a vector of the latent endogenous variables and B the corresponding
coefficient matrix (Fornell and Cha, 1994). j is a vector of the latent exogenous
variables, G the corresponding coefficient matrix and finally an error term, z, is
included. The second part of the model is the outer relations (Fornell and Cha,
1994). Here the relationship between the latent variables and the manifest
variables are defined and in contrast to LISREL these can both be reflective and
formative by nature (Jöreskog and Wold, 1982). In a reflective relationship the
manifest variables are determined by the latent variable whereas the latent
variable is determined by the manifest variables in formative relationships
(Jöreskog and Wold, 1982).
ER Since the analysis performed here is based on reflective outer relations only
26,2 this situation is mentioned in the following. The general formula for reflective
outer relations is shown in equation (2):
y ¼ Ly h þ 1y
ð2Þ
128 x ¼ Lx j þ 1 x :
Here y is a vector of the observed indicators of h and x is a vector of the
observed indicators of j. Ly and Lx are matrices that contain the li coefficients
which link the latent and the manifest variables together and d and 1 are the
error of measurement for x and y, respectively (Fornell and Cha, 1994). The
weight relations are the final part of the PLS model. In PLS each case value of
the latent variables can be estimated through the weight relations shown in
equation (3) as linear aggregates of their empirical indicators:
h^ ¼ vh y
ð3Þ
j^ ¼ vj x:
The ability to calculate case values for the latent variables is another reason
why PLS has preferred over LISREL. In LISREL case values cannot be
calculated without factor indeterminancy, which means that they should be
used with caution (Bollen, 1989). This is not a problem in PLS estimation.

Empirical results
The Nordic Employee Indexe is estimated using the statistical technique PLS
and the outcome is shown below in Figure 2. In the estimation procedure the
respondents have been weighted with respect to country, region, sex, age as
well as education in order to make the results more representative.
There is a range of measures that can be used to assess the fit of a PLS
model. Three of the most commonly applied are composite reliability, average
variance extracted, and R 2 (Fornell and Cha, 1994; Chin et al., 1996; Hulland,
1999). The three fit measures for the empirical model are shown in Table II. The
first measure in Table II is the composite reliability given by equation (4). Here
li is the factor loadings and Qi are the unique/error variances (Chin et al., 1996).
!2
Xk
li
i¼1
rc ¼ !2 : ð4Þ
X
k X
k
li þ ui
i¼1 i¼1

The composite reliability is used to assess the reliability of the latent

variables. Cronbach’s a could have been used instead but this measure is
 Work motivation
and job
satisfaction

129

Figure 2.
Empirical results for The
Nordic Employee
Indexe

Composite reliability AVE R2

Image 0.9383 0.8353

Senior management 0.9421 0.8028
Immediate superior 0.9475 0.8577
Cooperation 0.9182 0.7895
Conditions of work 0.8484 0.4876
Motivation and satisfaction 0.9450 0.8113 0.7131 Table II.
Loyalty 0.8681 0.5299 0.6930 Fit-measures for the
Total for model 0.6900 empirical model

calculated under the assumption of tau equivalence among the measures and
therefore composite reliability will provide a better estimate of the true
reliability (Chin et al., 1996). In this case the composite reliability of the
latent variables are above 0.90 except for “Conditions of Work” which is just
below 0.85. This is satisfactory and the latent variables are therefore thought
to be reliable.
The second measure shown in Table II is average variance extracted (AVE)
given by equation (5). This measure calculates the amount of variance captured
by the latent variables in relation to the amount due to measurement error
(Fornell and Cha, 1994):
ER
X
k
26,2 l2i
i¼1
AVE ¼ : ð5Þ
X
k

l2i þ ui
130 i¼1

In this case the AVEs are all above 0.5 except for “Conditions of work”. An
analysis of the individual items showed that the item dealing with job security
is the main reason for this. This might be due to specific structure of the labour
markets in the Nordic countries. In these countries the labour market is highly
regulated and employees are therefore guaranteed some degree of job security.
Therefore job security might not be as important for them as for employees
from other cultural settings.
This problem could be solved simply by omitting this item from the
questionnaire but. However, since the purpose of The Nordic Employee Indexe
is to develop a generic model applicable across cultural differences the item has
remained apart of the “Conditions of work” construct.
The third and last fit-measure in Table II is the R 2s of the latent endogenous
variables. This measure express the proportion of variance in the latent
endogenous variables explained by the structural relationships (Fornell and
Cha, 1994) just as in simple regression. The two R 2s stemming from this
analysis are both quite high so the fit of the model is also satisfactory on this
account.

The level of satisfaction

Based on the overall model indices for intrinsic work motivation and job
satisfaction have been calculated on a 0-100 scale. It is these two indices that
will be used to test the eight assumptions in the following. When calculating
indices the respondents have been weighted with respect to region, sex, age as
well as education in order to make the results more representative.
The first assumption, A1, to be tested is whether or not Danish workers
report a higher level of job satisfaction than workers from the other Nordic
countries. Results on both job satisfaction and intrinsic work motivation for all
four Nordic countries are shown in Figure 3. The overall Nordic result is
calculated as a weighted average of the four countries so that the result is
representative for the Nordic countries as a whole.
From Figure 3 it is evident that A1 can be confirmed. Danish workers report
a significantly higher level of job satisfaction ( p , 0.001). The differences in
job satisfaction can almost be replicated in internal work motivation although
there is no significant difference between the reported levels from Danish and
Finnish workers in this instance ( p = 0.929). This indicates that job satisfaction
 Work motivation
and job
satisfaction

131

Figure 3.
Job satisfaction and
intrinsic work
motivation in the Nordic
countries

and internal work motivation is highly related and at the overall Nordic level
the correlation between the two concepts is 0.795.
With respect to both job satisfaction and internal work motivation Swedish
workers report significant lower levels ( p , 0.001) than workers from other
Nordic countries and this is surprising since previous research showed that
reported job satisfaction in Sweden was at the same level as Norway
(Sousa-Poza and Sousa-Poza, 2000).
The reasons for these conflicting results can be twofold. First the sample
sizes in the previous research were a lot lower (Sousa-Poza and Sousa-Poza,
2000) than in The Nordic Employee Indexe study. Second, the results reported
in the previous research do not appear to have been weighted with respect to
region, sex, age as well as education in order to make the results more
representative.
Nevertheless if the trend from the sited study holds true one would actually
expect that employees from a large number of countries would evaluate their
job situation worse than the Swedish employees do if The Nordic Employee
Indexe was expanded to other countries (Sousa-Poza and Sousa-Poza, 2000).

The age effect

The next assumptions to be tested are the distribution of job satisfaction and
intrinsic work motivation in age. The actual relationship between age and job
satisfaction as well as intrinsic work motivation is shown in Figure 4.
It is obvious that the relationship between age and job satisfaction and age
and internal work motivation is far from u-shaped in the Nordic countries. In
ER
26,2

132

Figure 4.
The distribution of job
satisfaction and internal
work motivation by age

fact the relationship is close to being perfectly linear. A simple linear regression
model is significant ( p = 0.01) for both satisfaction and motivation with R 2s of
0.929 and 0.807 respectively. A2 and A3 have therefore not been confirmed in
this Nordic study.
In this respect the labour markets in the Nordic countries are more similar to
the US labour market than the UK labour market, since a linear relationship
between age and job satisfaction has previously been found in US studies
(Clark et al., 1996).

Other characteristics
In Figure 5 difference in job satisfaction and intrinsic work motivation are
given for the rest of the employee characteristics in focus in this study. Based
on Figure 5 the rest of the assumptions, A4-A8, can be tested.
A4 stated that women would be more satisfied with their job than men. This
assumption is not supported by the Nordic data since women and men appear
to be equally satisfied with their job ( p = 0.906). With regard to intrinsic work
motivation women appear to be more motivated but the difference between the
genders is not significant ( p = 0.172).
The reason for the difference between this study and previous studies
reporting a gender effect might be that the Nordic labour market is rather
homogenous with regard to gender. It might actually be a lack of homogeneity
that is the real reason for the reported differences in job satisfaction between
the genders in previous studies.
With regard to educational level A5 stated that highly educated employees
are less satisfied than other employees. From Figure 5 it is evident that this is
that case in the Nordic countries ( p , 0.001) so A5 is confirmed. In this context
 Work motivation
and job
satisfaction

133

Figure 5.
Difference in job
satisfaction and intrinsic
work motivation

the group of highly educated employees consists of those with a university

degree.
An interesting aspect is that although the employees with a high education
are less satisfied they are more motivated ( p = 0.03). A6 stated that educational
level should have no impact on intrinsic work motivation and therefore this
assumption has been disconfirmed by this study. The reason for this paradox
ER might be that the highly educated have more diversified and challenging tasks
26,2 that can motivate them despite their lower level of satisfaction.
From Figure 5 it is evident that A7 is also confirmed by this study.
Employees in managerial positions are significantly more satisfied ( p , 0.001)
than regular employees and the same is true for their intrinsic work motivation
( p , 0.001). The reason for this higher level of job satisfaction among
134 employees in managerial positions might be that they to a larger extent are able
to change elements of their vocational situation that they find unsatisfactory.
As was the case for the highly educated the employees that holds
managerial positions have more diversified and challenging tasks and this
might be the reason for the relative high level of intrinsic work motivation
among managers.
The last assumption to be tested is A8. This assumption stated that job
satisfaction should decrease with company size and results from the Nordic
countries are shown in Figure 5. From these data it is clear that there is no
significant difference in the reported levels of job satisfaction among employees
from companies with less than 50 employees and from companies with 50 to
499 employees ( p= 1.000).
The expected decrease in job satisfaction with company size occurs for
companies with 500 or more employees. Employees from the largest companies
report significant lower levels for both job satisfaction and intrinsic work
motivation ( p , 0001). Assumption A8 that job satisfaction decreases with
company size is therefore partially confirmed by this study in the Nordic
countries.

Concluding remarks
The aim of this paper was study the literature and test assumptions regarding
the differences in intrinsic work motivation and employee/job satisfaction
among employees with different characteristics. These assumptions where
then tested on data from 9,623 employees in the Nordic countries.
Previous research has shown that Danish workers are more satisfied than
workers from the other Nordic countries and this was confirmed by this study.
Other previous findings that were confirmed by this study includes that
employees with a high education are less satisfied, that managers are more
satisfied than regular workers and that job satisfaction decreases with
company size.
Job satisfaction between the genders has also been analysed in this study
and men and women in the Nordic countries were found to be equally satisfied
with their job. This contradicts previous findings where women were found to
be significantly more satisfied than men.
Furthermore this study on employees from the Nordic countries found that
job satisfaction and intrinsic work motivation are linear in age and that
employees with a high education report higher levels of intrinsic work Work motivation
motivation. These findings are also in conflict with previous findings. and job
It is clear from this study that job satisfaction and intrinsic work motivation satisfaction
are not globally uniform concepts and there is a need for further research
within this area especially on the differences between different cultural
settings. Therefore this study is now being expanded in an attempt to establish
a European Employee Index as a European standard for measuring employee
135
assets.

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