The impact of compensation on job satisfaction: Work experience and education relationship

https://doi.org/10.35912/ahrmr.v5i3.2888
Published: Sep 10, 2025

Abstract:

Purpose: To explore the effect of compensation on job satisfaction by mediating the relationship between work experience and education among manufacturing workers in Bekasi City's food and beverage industry.

Methodology: A quantitative approach with non-probability sampling. Data from 180 participants were analyzed using Structural Equation Modeling – Partial Least Squares (SEM-PLS) through SmartPLS to assess variable relationships.

Results: Work experience is positively associated with higher income and greater job satisfaction. Education likewise shows a significant positive relationship with salary and satisfaction. In addition, work-life balance enhances satisfaction. Furthermore, compensation operates as a mediating mechanism linking work experience and education to job satisfaction, indicating that gains from experience and education translate into satisfaction through pay.

Conclusions: Compensation plays a pivotal mediating role in translating work experience and educational background into job satisfaction. Implementing competitive and equitable compensation strategies can effectively enhance job satisfaction among workers in the food and beverage manufacturing sector.

Limitations: Non-probability sampling and focus on Bekasi City's food and beverage sector limit the generalizability of results.

Contribution: Provides useful insights for HR managers and contributes to human resource management and organizational behavior literature on compensation and job satisfaction.

Keywords:
1. Compensation
2. Education
3. Job Satisfaction
4. Work Experience
Authors:
1 . Anita Novialumi
Bina Insani University, Bekasi, Jawa Barat, Indonesia
2 . Siti Dewi Winata
Bina Insani University, Bekasi, Jawa Barat, Indonesia
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Novialumi, A., & Winata, S. D. (2025). The impact of compensation on job satisfaction: Work experience and education relationship. Annals of Human Resource Management Research, 5(3), 579–591. https://doi.org/10.35912/ahrmr.v5i3.2888
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Issue & Section
Vol. 5 No. 3 (2025): September
Articles
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References

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    Chen, C.-L., & Chen, L.-C. (2021). The Impact of Higher Education Expansion on the Educational Wage Premium in Taiwan: 1985 to 2015. International Journal of Financial Studies, 9(3), 1-12. doi:https://doi.org/10.3390/ijfs9030038

    Dua, J., & Sharma, A. K. (2024). Unveiling the ESG-Dividend Nexus: The Moderating Role of Investor Protection and Regulatory Enforcement. Journal of Indian Business Research, 16(2), 265-286. doi:https://doi.org/10.1108/JIBR-09-2023-0297

    Dua, S., Gupta, D., Singhal, A., & Thomas, N. J. (2024). Role of Public Schools in Education Decisions in Rural India. Review of Education, 12(3), e70010. doi:https://doi.org/10.1002/rev3.70010

    Gagliardi, N., Grinza, E., & Rycx, F. (2023). Workers’ Tenure and Firm Productivity: New Evidence from Matched Employer?Employee Panel Data. Industrial Relations: A Journal of Economy and Society, 62(1), 3-33. doi:https://doi.org/10.1111/irel.12309

    Gupta, V., Singhal, P., & Khattri, V. (2024). Enhancing Predictive Accuracy in Education: A Detailed Analysis of Student Performance Using Machine Learning Models. Tuijin Jishu/Journal of Propulsion Technology, 45(3), 1053-1070. doi:https://doi.org/10.52783/tjjpt.v45.i03.7313

    Hair Jr, J. F., Matthews, L. M., Matthews, R. L., & Sarstedt, M. (2017). PLS-SEM or CB-SEM: Updated Guidelines on Which Method to Use. International Journal of Multivariate Data Analysis, 1(2), 107-123. doi:https://doi.org/10.1504/IJMDA.2017.087624

    Hermawan, A., Wulandari, A., Buana, A. M., & Sanjaya, V. (2021). Pengaruh Kompetensi, Insentif dan Pengalaman Kerja Terhadap Kinerja Karyawan di Lampung. Studi Ilmu Manajemen dan Organisasi, 1(1), 71-83. doi:https://doi.org/10.35912/simo.v1i1.149

    Hernawan, B. D., & Srimulyani, V. A. (2021). Dampak Kompensasi terhadap Retensi Karyawan dengan Kepuasan Kerja sebagai Pemediasi. Reviu Akuntansi, Manajemen, dan Bisnis, 1(2), 115-125. doi:https://doi.org/10.35912/rambis.v1i2.888

    Herzberg, C. (2022). Understanding the Paleoproterozoic Circum-Superior Large Igneous Province Constrains the Thermal Properties of Earth’s Mantle Through Time. Precambrian Research, 375. doi:https://doi.org/10.1016/j.precamres.2022.106671

    Judge, T. A., Piccolo, R. F., Podsakoff, N. P., Shaw, J. C., & Rich, B. L. (2010). The Relationship between Pay and Job Satisfaction: A Meta-Analysis of the Literature. Journal of Vocational Behavior, 77(2), 157-167. doi:https://doi.org/10.1016/j.jvb.2010.04.002

    Khan, M. M. R. (2020). Strategic Human Resource Management in Facilitating the Organizational Performance: Birds-Eye View from Bangladesh. Annals of Management and Organization Research, 2(1), 13-24. doi:https://doi.org/10.35912/amor.v2i1.575

    Lai, V., Chen, C., Liao, Q. V., Smith-Renner, A., & Tan, C. (2021). Towards a Science of Human-AI Decision Making: A Survey of Empirical Studies. Proceedings of the 2023 ACM Conference on Fairness, Accountability, and Transparency, 1369-1385. doi:https://doi.org/10.48550/arXiv.2112.11471

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    Lee, V. R., Wilkerson, M. H., & Lanouette, K. (2021). A Call for a Humanistic Stance Toward K–12 Data Science Education. Educational Researcher, 50(9), 664-672. doi:https://doi.org/10.3102/0013189X211048810

    Lin, M.-T., Kao, K.-Y., & Hsu, H.-H. (2022). Linking Mentoring to Organizational Citizenship Behavior: The Roles of Protégés’ Task Performance and Job Satisfaction. Journal of Career Development, 49(5), 1137-1151. doi:https://doi.org/10.1177/08948453211027955

    Mabaso, C. M., & Dlamini, B. I. (2017). Impact of Compensation and Benefits on Job Satisfaction. Research Journal of Business Management, 11(2), 80-90. doi:https://doi.org/10.3923/rjbm.2017.80.90

    Maulidah, K., Ali, S., & Pangestuti, D. C. (2022). Pengaruh Beban Kerja dan Kepuasan Kerja terhadap Turnover Intention Karyawan RSU “ABC” Jakarta Selatan. Jurnal Akuntansi, Keuangan dan Manajemen, 3(2), 159-176. doi:https://doi.org/10.35912/jakman.v3i2.611

    Nam, M.-W., Chung, J., Park, S., Lee, W., Park, J., Koh, D.-H., . . . Park, D.-U. (2022). Characteristics of Workers’ Compensation Claim Applications for COVID-19 Infections in South Korea. Industrial health, 61(1), 78-87. doi:https://doi.org/10.2486/indhealth.2021-0271

    Nimtur, B. M., Kusa, N. D., & Olanrewaju, D. S. (2023). Job Satisfaction on Talent Management and Turnover Intention among Private Secondary Schools. Annals of Human Resource Management Research, 3(2), 129-140. doi:https://doi.org/10.35912/ahrmr.v3i2.1878

    Patel, M., Kumar, R., Kishor, K., Mlsna, T., Pittman Jr, C. U., & Mohan, D. (2019). Pharmaceuticals of Emerging Concern in Aquatic Systems: Chemistry, Occurrence, Effects, and Removal Methods. Chemical Reviews, 119(6), 3510-3673. doi:https://doi.org/10.1021/acs.chemrev.8b00299

    Peramatzis, G., & Galanakis, M. (2022). Herzberg’s Motivation Theory in Workplace. Psychology, 12(1), 971-978. doi:https://doi.org/10.17265/2159-5542/2022.12.009

    Phina, O. N., Ogechukwuand, N. N., & Shallom, A. A. (2021). Organizational Climate and Employee Engagement: A Commercial Bank Perspective in Southeast Nigeria. Annals of Management and Organization Research, 2(3), 161-173. doi:https://doi.org/10.35912/amor.v2i3.805

    Purnama, C., Fatmah, D., Rahmah, M., Hasani, S., Rahmah, Y., & Rahmah, Z. Z. (2024). Understanding How Organizational Culture and Job Satisfaction Drive Commitment and Citizenship Behavior in SMEs. Journal of Human Resource Management, 27(2), 158-168. doi:https://doi.org/10.46287/ktem1048

    Robbins, S. P., & Judge, T. (2022). Organizational Behavior. New York: Perason Education.

    Sabater, J., Best, P. N., Tasse, C., Hardcastle, M. J., Shimwell, T. W., Nisbet, D., . . . Zaroubi, S. (2021). The LOFAR Two-Meter Sky Survey: Deep Fields Data Release 1-II. The ELAIS-N1 LOFAR Deep Field. Astronomy & Astrophysics, 648, 1-20. doi:https://doi.org/10.1051/0004-6361/202038828

    Skinner, B. F. (1965). Science and Human Behavior. New York: The Free Press.

    Smith, H. A., Besunder, J. B., Betters, K. A., Johnson, P. N., Srinivasan, V., Stormorken, A., . . . Acinelli, L. (2022). 2022 Society of Critical Care Medicine Clinical Practice Guidelines on Prevention and Management of Pain, Agitation, Neuromuscular Blockade, and Delirium in Critically Ill Pediatric Patients With Consideration of the ICU Environment and Early Mobility. Pediatric Critical Care Medicine, 23(2), 74-110. doi:https://doi.org/10.1097/pcc.0000000000002873

    Suripto, T. (2016). Meningkatkan Kinerja Karyawan Melalui Expectancy Theory dalam Motivasi. JESI (Jurnal Ekonomi Syariah Indonesia), 5(2), 115-123. doi:http://dx.doi.org/10.21927/jesi.2015.5(2).115-123

    Vinichenko, M. V., Rybakova, M. V., Chulanova, O. L., Barkov, S. A., Makushkin, S. A., & Karacsony, P. (2021). Views on Working with Information in a Semi-Digital Society: Its Possibility to Develop as Open Innovation Culture. Journal of Open Innovation: Technology, Market, and Complexity, 7(2), 1-19. doi:https://doi.org/10.3390/joitmc7020160

    Wang, C., Xiao, A., & Zhou, Y. (2024). Teamwork and Human Capital Development. Journal of Human Resources, 59(5), 1425-1457. doi:https://doi.org/10.3368/jhr.0121-11400r2

    Wang, Z., Xu, H., & Liu, Y. (2018). Servant Leadership as a Driver of Employee Service Performance: Test of a Trickle-Down Model and its Boundary Conditions. Human relations, 71(9), 1179-1203. doi:https://doi.org/10.1177/0018726717738320

    Whelan, J., Brown, A. D., Coller, L., Strugnell, C., Allender, S., Alston, L., . . . Bell, C. (2021). The Impact of COVID-19 on Rural Food Supply and Demand in Australia: Utilising Group Model Building to Identify Retailer and Customer Perspectives. Nutrients, 13(2), 1-11. doi:https://doi.org/10.3390/nu13020417

    Whelan, S. F., & Hally, M. (2020). Compensation for Wrongful Injury in Ireland: Principles, Practice and Cost to the State. The Economic and Social Review, 51(3), 425-460.

    Wu, J.-C., Chen, H.-W., Chiu, Y.-J., Chen, Y.-C., Kang, Y.-N., Hsu, Y.-T., . . . Kuo, S.-Y. (2022). Comparison of Simulation-Based Interprofessional Education and Video-Enhanced Interprofessional Education in Improving the Learning Outcomes of Medical and Nursing Students: A Quasi-Experimental Study. Nurse education today, 118. doi:https://doi.org/10.1016/j.nedt.2022.105535

    Zhang, M., Zhou, M., Tang, F., Wang, Y., Nie, H., Zhang, L., & You, G. (2020). Knowledge, Attitude, and Practice Regarding COVID-19 among Healthcare Workers in Henan, China. Journal of Hospital Infection, 105(2), 183-187. doi:https://doi.org/10.1016/j.jhin.2020.04.012

    Zhang, X., & Liu, S. (2022). Understanding Relationship Commitment and Continuous Knowledge Sharing in Online Health Communities: A Social Exchange Perspective. Journal of Knowledge Management, 26(3), 592-614. doi:https://doi.org/10.1108/JKM-12-2020-0883

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  2. Chen, C.-L., & Chen, L.-C. (2021). The Impact of Higher Education Expansion on the Educational Wage Premium in Taiwan: 1985 to 2015. International Journal of Financial Studies, 9(3), 1-12. doi:https://doi.org/10.3390/ijfs9030038
  3. Dua, J., & Sharma, A. K. (2024). Unveiling the ESG-Dividend Nexus: The Moderating Role of Investor Protection and Regulatory Enforcement. Journal of Indian Business Research, 16(2), 265-286. doi:https://doi.org/10.1108/JIBR-09-2023-0297
  4. Dua, S., Gupta, D., Singhal, A., & Thomas, N. J. (2024). Role of Public Schools in Education Decisions in Rural India. Review of Education, 12(3), e70010. doi:https://doi.org/10.1002/rev3.70010
  5. Gagliardi, N., Grinza, E., & Rycx, F. (2023). Workers’ Tenure and Firm Productivity: New Evidence from Matched Employer?Employee Panel Data. Industrial Relations: A Journal of Economy and Society, 62(1), 3-33. doi:https://doi.org/10.1111/irel.12309
  6. Gupta, V., Singhal, P., & Khattri, V. (2024). Enhancing Predictive Accuracy in Education: A Detailed Analysis of Student Performance Using Machine Learning Models. Tuijin Jishu/Journal of Propulsion Technology, 45(3), 1053-1070. doi:https://doi.org/10.52783/tjjpt.v45.i03.7313
  7. Hair Jr, J. F., Matthews, L. M., Matthews, R. L., & Sarstedt, M. (2017). PLS-SEM or CB-SEM: Updated Guidelines on Which Method to Use. International Journal of Multivariate Data Analysis, 1(2), 107-123. doi:https://doi.org/10.1504/IJMDA.2017.087624
  8. Hermawan, A., Wulandari, A., Buana, A. M., & Sanjaya, V. (2021). Pengaruh Kompetensi, Insentif dan Pengalaman Kerja Terhadap Kinerja Karyawan di Lampung. Studi Ilmu Manajemen dan Organisasi, 1(1), 71-83. doi:https://doi.org/10.35912/simo.v1i1.149
  9. Hernawan, B. D., & Srimulyani, V. A. (2021). Dampak Kompensasi terhadap Retensi Karyawan dengan Kepuasan Kerja sebagai Pemediasi. Reviu Akuntansi, Manajemen, dan Bisnis, 1(2), 115-125. doi:https://doi.org/10.35912/rambis.v1i2.888
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  11. Judge, T. A., Piccolo, R. F., Podsakoff, N. P., Shaw, J. C., & Rich, B. L. (2010). The Relationship between Pay and Job Satisfaction: A Meta-Analysis of the Literature. Journal of Vocational Behavior, 77(2), 157-167. doi:https://doi.org/10.1016/j.jvb.2010.04.002
  12. Khan, M. M. R. (2020). Strategic Human Resource Management in Facilitating the Organizational Performance: Birds-Eye View from Bangladesh. Annals of Management and Organization Research, 2(1), 13-24. doi:https://doi.org/10.35912/amor.v2i1.575
  13. Lai, V., Chen, C., Liao, Q. V., Smith-Renner, A., & Tan, C. (2021). Towards a Science of Human-AI Decision Making: A Survey of Empirical Studies. Proceedings of the 2023 ACM Conference on Fairness, Accountability, and Transparency, 1369-1385. doi:https://doi.org/10.48550/arXiv.2112.11471
  14. Lee, C., & Park, S. (2021). Changing Factors of Employee Satisfaction with Working Conditions: An Analysis of the Korean Working Conditions Survey. Safety and health at work, 12(3), 324-338. doi:https://doi.org/10.1016/j.shaw.2021.04.003
  15. Lee, V. R., Wilkerson, M. H., & Lanouette, K. (2021). A Call for a Humanistic Stance Toward K–12 Data Science Education. Educational Researcher, 50(9), 664-672. doi:https://doi.org/10.3102/0013189X211048810
  16. Lin, M.-T., Kao, K.-Y., & Hsu, H.-H. (2022). Linking Mentoring to Organizational Citizenship Behavior: The Roles of Protégés’ Task Performance and Job Satisfaction. Journal of Career Development, 49(5), 1137-1151. doi:https://doi.org/10.1177/08948453211027955
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  18. Maulidah, K., Ali, S., & Pangestuti, D. C. (2022). Pengaruh Beban Kerja dan Kepuasan Kerja terhadap Turnover Intention Karyawan RSU “ABC” Jakarta Selatan. Jurnal Akuntansi, Keuangan dan Manajemen, 3(2), 159-176. doi:https://doi.org/10.35912/jakman.v3i2.611
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  20. Nimtur, B. M., Kusa, N. D., & Olanrewaju, D. S. (2023). Job Satisfaction on Talent Management and Turnover Intention among Private Secondary Schools. Annals of Human Resource Management Research, 3(2), 129-140. doi:https://doi.org/10.35912/ahrmr.v3i2.1878
  21. Patel, M., Kumar, R., Kishor, K., Mlsna, T., Pittman Jr, C. U., & Mohan, D. (2019). Pharmaceuticals of Emerging Concern in Aquatic Systems: Chemistry, Occurrence, Effects, and Removal Methods. Chemical Reviews, 119(6), 3510-3673. doi:https://doi.org/10.1021/acs.chemrev.8b00299
  22. Peramatzis, G., & Galanakis, M. (2022). Herzberg’s Motivation Theory in Workplace. Psychology, 12(1), 971-978. doi:https://doi.org/10.17265/2159-5542/2022.12.009
  23. Phina, O. N., Ogechukwuand, N. N., & Shallom, A. A. (2021). Organizational Climate and Employee Engagement: A Commercial Bank Perspective in Southeast Nigeria. Annals of Management and Organization Research, 2(3), 161-173. doi:https://doi.org/10.35912/amor.v2i3.805
  24. Purnama, C., Fatmah, D., Rahmah, M., Hasani, S., Rahmah, Y., & Rahmah, Z. Z. (2024). Understanding How Organizational Culture and Job Satisfaction Drive Commitment and Citizenship Behavior in SMEs. Journal of Human Resource Management, 27(2), 158-168. doi:https://doi.org/10.46287/ktem1048
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  27. Skinner, B. F. (1965). Science and Human Behavior. New York: The Free Press.
  28. Smith, H. A., Besunder, J. B., Betters, K. A., Johnson, P. N., Srinivasan, V., Stormorken, A., . . . Acinelli, L. (2022). 2022 Society of Critical Care Medicine Clinical Practice Guidelines on Prevention and Management of Pain, Agitation, Neuromuscular Blockade, and Delirium in Critically Ill Pediatric Patients With Consideration of the ICU Environment and Early Mobility. Pediatric Critical Care Medicine, 23(2), 74-110. doi:https://doi.org/10.1097/pcc.0000000000002873
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  30. Vinichenko, M. V., Rybakova, M. V., Chulanova, O. L., Barkov, S. A., Makushkin, S. A., & Karacsony, P. (2021). Views on Working with Information in a Semi-Digital Society: Its Possibility to Develop as Open Innovation Culture. Journal of Open Innovation: Technology, Market, and Complexity, 7(2), 1-19. doi:https://doi.org/10.3390/joitmc7020160
  31. Wang, C., Xiao, A., & Zhou, Y. (2024). Teamwork and Human Capital Development. Journal of Human Resources, 59(5), 1425-1457. doi:https://doi.org/10.3368/jhr.0121-11400r2
  32. Wang, Z., Xu, H., & Liu, Y. (2018). Servant Leadership as a Driver of Employee Service Performance: Test of a Trickle-Down Model and its Boundary Conditions. Human relations, 71(9), 1179-1203. doi:https://doi.org/10.1177/0018726717738320
  33. Whelan, J., Brown, A. D., Coller, L., Strugnell, C., Allender, S., Alston, L., . . . Bell, C. (2021). The Impact of COVID-19 on Rural Food Supply and Demand in Australia: Utilising Group Model Building to Identify Retailer and Customer Perspectives. Nutrients, 13(2), 1-11. doi:https://doi.org/10.3390/nu13020417
  34. Whelan, S. F., & Hally, M. (2020). Compensation for Wrongful Injury in Ireland: Principles, Practice and Cost to the State. The Economic and Social Review, 51(3), 425-460.
  35. Wu, J.-C., Chen, H.-W., Chiu, Y.-J., Chen, Y.-C., Kang, Y.-N., Hsu, Y.-T., . . . Kuo, S.-Y. (2022). Comparison of Simulation-Based Interprofessional Education and Video-Enhanced Interprofessional Education in Improving the Learning Outcomes of Medical and Nursing Students: A Quasi-Experimental Study. Nurse education today, 118. doi:https://doi.org/10.1016/j.nedt.2022.105535
  36. Zhang, M., Zhou, M., Tang, F., Wang, Y., Nie, H., Zhang, L., & You, G. (2020). Knowledge, Attitude, and Practice Regarding COVID-19 among Healthcare Workers in Henan, China. Journal of Hospital Infection, 105(2), 183-187. doi:https://doi.org/10.1016/j.jhin.2020.04.012
  37. Zhang, X., & Liu, S. (2022). Understanding Relationship Commitment and Continuous Knowledge Sharing in Online Health Communities: A Social Exchange Perspective. Journal of Knowledge Management, 26(3), 592-614. doi:https://doi.org/10.1108/JKM-12-2020-0883