Index

ABSTRACT

The term millennial generation is being heard, often called generation me or echo boomers. There is no specific demographic in determining this generation group. Millennial generation is a generation between 20-36 years old. One of the problems of the millennial generation in the workplace is the low level of organizational commitment due to environmental influences at work, such as work-life balance, compensation, and job satisfaction. However, if you are able to manage the millennial generation, it can be more beneficial for organizations because they tend to be more creative. This study aims to analyze the effect of work-life balance, compensation, and job satisfaction on organizational commitment. Conducted on front liner employees at Hotel Melia Bali with a sample size of 65 respondents. The collected data were analyzed using multiple linear regression. The results show that work-life balance, compensation, and job satisfaction can significantly increase organizational commitment of millennial generation employees. Implication of this research also informs that increasing organizational commitment can be done by providing flexibility in working time, setting clearer reward standards and implementing transparent employee promotions.

Keywords:Work-life balance, Compensation, Job satisfaction, Organizational commitment.

DOI: 10.20448/807.6.2.139.147

Citation | Ni Putu Laras Alda Risma Elpariani; I Gede Riana; Ida Bagus Ketut Surya (2020). Coherency Work-life Balance, Compensation, Job Satisfaction and Organizational Commitments Millennial Generations. Global Journal of Social Sciences Studies, 6(2): 139-147.

Copyright: This work is licensed under a Creative Commons Attribution 3.0 License

Funding : This study received no specific financial support.

Competing Interests: The authors declare that they have no competing interests.

History : Received: 28 September 2020 / Revised: 19 October 2020 / Accepted: 29 October 2020 / Published: 23 November 2020 .

Publisher: Online Science Publishing

1. INTRODUCTION

Sustainable Development Goals (SDGs) aims to promote inclusive and sustainable economic growth, full and productive employment and decent work for all people around the world. Referring to the SDGs goal, most organizations are now starting to employ employees at a productive age, namely millennials. Millennials are those born between years of 1981 until 2000 (Ali & Purwandi, 2017). Millennials are increasingly dominating the work environment because the number reaches 63.5 million of the total productive age population in Indonesia (Utomo & Noormega, 2020). One of the main problems of the millennial generation in the world of work is low organizational commitment. Organizational commitment is an attitude that reflects an individual knowing and being attached to the organization (Moorhead & Griffin, 2013). Millennials are a generation with a low level of loyalty to the organization, because the work span of 2-3 years in one organization is considered the most ideal (Utomo & Noormega, 2020). Millennials are also shown to have low levels of patience, high egoism and tend to choose to change workplaces if they have the opportunity (Smith & Nichols, 2015). Attempting to satisfy and involve this generation in order to have high organizational commitment is a potentially difficult task for organizations. Millennials focus on family and therefore need to have a better work-life balance (Smith & Nichols, 2015). Weeks and Schaffert (2019) shows that most millennials choose to work in jobs that they find fun, satisfying, and integrating work-life balance. One of the ways to create work-life balance is by giving a high degree of freedom and flexibility to complete tasks. Flexible work arrangements refer to flexible working hours, part-time work arrangements, and division of labor tasks (Molineux, Mirshekary, & Scarparo, 2015). Abdirahman, Najeemdeen, Abidemi, and Ahmad (2020) explained work-life balance and job satisfaction can increase organizational commitment. Likewise, giving good compensation will motivate employees to commit to organizations that have met their life needs (Folakemi, 2017). Compensation is anything that employees receive as part of the employment relationship and can be divided into two types, namely financial compensation and non-financial compensation (Rivai & Sagala, 2005). Providing fair compensation to employees can increase organizational commitment because they feel that their performance is appreciated by the leadership (Desniari & Dewi, 2020). Sari and Riana (2018) shows that compensation has a significant effect on organizational commitment.

As with work-life balance and compensation, job satisfaction can also increase organizational commitment (Frempong, Agbenyo, & Darko, 2018). Employees who have a high level of job satisfaction tend to have a higher work commitment (Baporikar, 2017; Culibrk, Delić, Mitrović, & Culibrk, 2018; Malik, Haider, & Hussain, 2019) . The results of Jang and Juliana (2020) study found that job satisfaction felt by millennials will make this generation survive and loyal to the organization, and will even feel that leaving the organization is a bad thing to do. Rene and Wahyuni (2018) found that work-life balance did not have a significant effect on organizational commitment. The results of this study have differences with previous studies (Buzza, 2017) that work-life balance has a significant effect in increasing the organizational commitment of the millennial generation. Likewise, the research of Da Silva, Dutra, Veloso, Fischer, and Trevisan (2015) and Pradhan, Jena, and Kumari (2016) that there is a significant relationship between work-life balance and organizational commitment. This study aims to analyze the effect of work-life balance, compensation, and job satisfaction on organizational commitment to the millennial generation. Organizational commitment is an attitude that shows more than just formal membership, but also includes an attitude of liking the organization and a willingness to put forth high efforts for the benefit of the organization (Suparyadi, 2015). Robbins and Judge (2017) defines organizational commitment as a condition where a worker sides with a particular organization and the desire to maintain membership in the organization. Allen and Meyer (1993) state organizational commitment as a psychological state that characterizes the relationship between employees and the organization so that it affects whether employees remain in the organization or not, which is identified in three components, namely affective commitment, continuous commitment, and normative commitment.

Work-life balance (WLB) is defined as a condition of satisfaction and good functioning at work and at home with minimal role conflict (Clark, 2000). Buzza (2017) informs that millennial employees are significantly more interested in work when there is a high work-life balance. The existence of work-life balance has been shown to increase employee loyalty and organizational commitment for the millennial generation (Capnary, Rachmawati, & Agung, 2018). A number of studies have found that work-life balance has a significant effect on organizational commitment (Da Silva et al., 2015; Hofmann & Stokburger-Sauer, 2017; Pradhan et al., 2016) . Abdirahman et al. (2020) stated that work-life balance has a significant effect in increasing the organizational commitment of millennial employees at the University.

Talukder (2019) found the same results that work-life balance has a significant effect on organizational commitment of financial sector employees in Australia. The results of the same study were conducted by Olawale, Fapohunda, and Ilesnmi (2017) on working postgraduate students at Lagos State University. Compensation involves calculating an equal that is considered something comparable (Mangkunegara & Prabu, 2015). Rivai and Sagala (2005) explains that compensation includes financial and non-financial rewards as well as benefits received by employees as part of the employment relationship. Compensation is a substitute for contributions to the organization (Simamora, 2004). Walden, Jung, and Westerman (2017) found compensation has a significant effect on the organizational commitment of millennial generation employees in the United States. Other studies have also found compensation has a significant effect on organizational commitment (Almutairi & Al Sawalha, 2020; Arta & Surya, 2017; Desniari & Dewi, 2020; Sari & Riana, 2018) .

The results of research by Cahyaningtyas and Hadi (2017) on employees of the Patra Jasa Convention Hotel Semarang, as well as research by Farla, Diah, and Bakri (2019) on MSME employees in Palembang also show that compensation has a significant effect on organizational commitment. Furthermore, job satisfaction is a positive emotional state which is the result of evaluating one's work experience (Luthans, 2009). A positive attitude is based on the results of an evaluation of what is expected to be obtained through the efforts made in carrying out the work with the rewards received (Suparyadi, 2015). Employees with high job satisfaction levels tend to have higher work commitment (Malik et al., 2019). Mishra, Yavagal, and Bagwe (2018) found that job satisfaction felt by millennials can increase organizational commitment so that they want to stay in the organization. Saragih, Widodo, and Prasetyo (2016) found that job satisfaction has a significant effect on the organizational commitment of millennial employees in Jakarta. Research results (Jang & Juliana, 2020) shows that job satisfaction can increase the organizational commitment of millennial generation employees in the education industry in Jakarta. Meanwhile, research by Andrade, Westover, and Miller (2020) in the hotel industry employees from 37 countries also found that job satisfaction has a significant effect on organizational commitment.

H1: Work-life balance has a significant positive effect on organizational commitment.
H2: Compensation has a significant positive effect on organizational commitment.
H3: Job satisfaction has a significant positive effect on organizational commitment.

2.METHOD

The research location was conducted at the Melia Bali Hotel with a population of 189 millennial generation employees spread over 15 departments. The number of samples was determined using probability random sampling technique with the Slovin approach. Based on the calculation, the number of samples that must be met is 65 employees. Primary data sources were obtained directly through a research questionnaire. Secondary data were obtained from the Human Resources Department of Hotel Melia Bali. The questionnaire was compiled with a number of question items, work-life balance variable (X1) was adopted from the research of Poulose and Sudarsan (2017) compensation variable (X2) was adopted from Farla et al. (2019) job satisfaction variable (X3) was adopted from Baporikar (2017) and organizational commitment (Y) was adopted from Desniari and Dewi (2020) with several modifications to suit the research object. Before all data were collected and analyzed, the research instrument was tested using 30 samples. The test results show that all items have a product moment correlation value ≥ 0.30 and Cronbach Alpha value ≥ 0.60 so that the research instrument is declared valid (Sugiyono, 2014) and reliable (Arikunto, 2013). Furthermore, all data collected were analyzed using multiple regression analysis. The profile of respondents is described in Table 1, as follows.

3. RESULTS

The results of the inter-variable effect hypothesis testing using regression analysis found the results shown in Table 2.
The regression equation obtained from the results of data processing in Table 2 is as follows.

To find out whether the regression model prepared is correct and shows a significant and representative relationship, a classic assumption test is carried out consisting of normality, multicollinearity and heteroscedasticity tests. The normality test is carried out to test whether the regression model between the independent variables on the dependent variable has a normal distribution or not. The normality test was carried out by the Kolmogorov-Smirnov test. The data is said to be normally distributed if the significance of the residual value is > 0.005 Table 3.

The results of the normality test showed a Kolmogorov-Smirnov value of 0.104 and a significance of 0.080. The test results inform that the significance value is 0.080 > 0.05. This indicates that the data has been normally distributed. Then, to detect the presence or absence of multicollinearity in the regression model, a multicollinearity test was performed by looking at the tolerance coefficient value > 0.10 and the VIF value < 10 for all independent variables.

The test results in Table 4 show that the tolerance coefficient of all variables is > 0.10 and the VIF value < 10. These results indicate that there is no multicollinearity symptom in this research model. Heteroscedasticity test tests the variance inequality of the regression model from the residuals of one observation to another using the Glejser test, if the significance level of each independent variable is > 0.05, it is concluded that there are no symptoms of heteroscedasticity. The results of the Glejser test in Table 4 inform that the regression model in this study is free from heteroscedasticity symptoms, seen from the significance value of all independent variables > 0.05. Meanwhile, the results of hypothesis testing Table 2 show that a coefficient of work-life balance has a value of 0.614 with a significance value of 0.000 (sig < 0.05) indicating that a good balance between work and personal life can increase the organizational commitment of the millennial generation. Furthermore, the compensation regression coefficient is 0.314 with a significance value of 0.000, indicating that the provision of appropriate compensation can increase the organizational commitment of the millennial generation. The regression coefficient of job satisfaction is 0.212 with a significance value of 0.036 (sig < 0.05), indicating that the job satisfaction felt by the millennial generation can increase organizational commitment. Then, to find out the percentage of the influence of the independent variable on the dependent variable can be seen in the results of the coefficient of determination (R2) Table 2. The R Square value of 0.657 informs that the work-life balance (X1), compensation (X2), job satisfaction (X3) variables are able explained that organizational commitment (Y) was 65.7 percent and the remaining 34.3 percent was influenced by other variables outside the research.

4. DISCUSSION

Millennial are indicated to have low organizational commitment to an organization if their needs are not met. Therefore, organizations must pay attention to a number of things in work, such as work-life balance, providing appropriate compensation and ensuring job satisfaction. The results of the study inform that work-life balance has a significant effect on organizational commitment. When millennial employees feel a balance between work and life, then organizational commitment can be even higher. The results of the analysis show that employees have organizational commitment because they are given flexibility in the workplace, such as working hours. Buzza (2017) states that millennial employees are more interested in work when they feel a high work-life balance. Work-life balance in organizations has also been shown to increase employee loyalty and organizational commitment (Capnary et al., 2018). Furthermore, Hofmann and Stokburger-Sauer (2017) found that there is a significant relationship between work-life balance and organizational commitment of millennial employees in the hotel industry. In fact, Abdirahman et al. (2020) conducted a study on millennial employees at the University found that work-life balance can increase organizational commitment.

Besides work life balance, the perceived fairness of compensation is also able to increase organizational commitment. The suitability of the compensation received by employees creates higher organizational commitment. Providing compensation that is felt to be fair can motivate employees to commit to the organization, because compensation has met the needs of life (Folakemi, 2017). Research (Walden et al., 2017) on millennial generation employees in the United States, Sari and Riana (2018) on employees of PT. Jenggala Keramik Bali, and research by Arta and Surya (2017) on the PRU Megas agent show that compensation has a significant impact on increasing organizational commitment. Job satisfaction also has an impact on the level of organizational commitment. This study informs that job satisfaction has a significant impact on organizational commitment. The high job satisfaction felt by millennial generation employees will further increase organizational commitment. Mishra et al. (2018) stated that the job satisfaction felt by millennials can increase organizational commitment so that they want to stay in the organization. Previous research (Andrade et al., 2020; Jang & Juliana, 2020) states that job satisfaction has a significant effect on the organizational commitment of millennial generation employees in the Jakarta education industry and the hospitality industry in 37 countries.

Millennial also known as Generation Y is a demographic group after Generation X (Gen-X). There is no definite time limit for the beginning and end of this group. Experts and researchers usually use the early 1980s as the beginning of the birth of this group and the mid-1990s to early 2000s as the end of birth. Retaining millennial generation employees can be done by knowing the factors that affect organizational commitment. The findings of this study state that work-life balance is proven to increase the organizational commitment of the millennial generation. The higher work-life balance of the millennial generation, the higher the organizational commitment so that they have no reason to leave the organization. Compensation is also proven to increase the organizational commitment of the millennial generation. This informs that compensation that is deemed appropriate can increase the organizational commitment of the millennial generation. Furthermore, job satisfaction has been shown to increase the organizational commitment of the millennial generation. Feelings of satisfaction with work and the work environment can increase the organizational commitment of the millennial generation. Implication of this research shows that the millennial generation will have a high organizational commitment when the organization is able to provide fair compensation so that it is considered appropriate and feels a work-life balance in the workplace.

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