Human resource practices, employee attitudes and small firm performance

Yanqing Lai, George Saridakis, Stewart Johnstone

Research output: Contribution to journalArticle

25 Citations (Scopus)

Abstract

This article uses the matched employee–employer dataset from the Workplace Employment Relations Study of 2011 (WERS2011) in Britain to empirically examine the direct relationship between human resource management (HRM) practices and small and medium-sized enterprise (SME) performance in the United Kingdom, as well as the potential moderating effect of organisational commitment/job satisfaction on the HRM-performance linkage. We find a positive and direct relationship between the use of certain formalised human resource (HR) practices and SME performance, measured by financial performance and labour productivity. More importantly, we find that the positive relationship between HR practices and financial performance varies between SMEs with high job satisfaction and low job satisfaction, and that the relationship is weakened in SMEs with high job satisfaction. The results suggest that certain HR policies and practices may improve small firm performance, especially within firms with low levels of commitment and satisfaction.

Original languageEnglish
Pages (from-to)470-494
Number of pages25
JournalInternational Small Business Journal: Researching Entrepreneurship
Volume35
Issue number4
Early online date4 Apr 2016
DOIs
Publication statusPublished - 1 Jun 2017

Keywords

  • employee attitudes
  • human resource practices
  • microeconometrics
  • small firm performance
  • WERS

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