The mediating role of pension contribution schemes in relationship between organizational commitment and job satisfaction

Abstract

Purpose. The aim of this study is to clarify the influence of job satisfaction on organizational commitment, with a pension contribution scheme as a mediating variable. The study employed life cycle theory and pension productivity theory to clarify the interaction of the variables used to describe the mediating role of pension contribution systems in the context of job satisfaction and organizational commitment. Method. The research used a “structural equation modelling’ approach to examine the gathered date. For analysis purpose, a cross-sectional survey design was developed and empirically verified with data (N = 550) obtained from a random sample of Lagos state government workers. Findings. Results showed that job satisfaction (β = 0.75, t =12.49; p < 0.05) was positively and significantly associated with pension contribution schemes. There is also a significant positive correlation between job satisfaction (β = 0.58, t = 5.85; p < 0.05) and organizational commitment. This means that job satisfaction and pension contributions are predictors of organizational commitment. Pension contribution schemes were also shown to partially mediate job satisfaction and organizational commitment with β-value of0.16 and p-value of 0.000. The results are presented taking into consideration the relevant research as well as the practical implications for the governments and private organizations at all levels to pay greater attention to the financial well-being and social security of retired workers. Velue of results. The novel theoretical contribution that was made by this current study is its emphasis that pension schemes are the platform through which job satisfaction and organizational engagement pave the way for the financial well-being and social security of employees in retirement.