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Why high employee satisfaction does not equate to high morale

How can employees be highly satisfied with their work, yet have low morale?  This paradox is becoming a more frequent finding in recent employee surveys.  In analysing the results from more than 6,500 employees across 8 Australian organisations since 2000, The Ryder Self Group has identified that while employee satisfaction and morale are linked, they are driven by different factors.

Ensuring employees’ skills and abilities are matched to their jobs will drive higher job satisfaction.  Morale will improve through employees being led and managed well, given regular performance feedback and recognition, a pleasant work environment, customer focus and a clear direction for their organisation.

Currently, organisations are more successful in achieving employee satisfaction than high employee morale.

The Relationship between Employee Satisfaction and Morale

Employee Surveys measure a number of job and work related variables covering the physical work environment, resources, pay, leadership, communication, performance management, customer focus, recognition and reward, workload, stress etc.  In our surveys, individuals rate how important these attributes are to them and their current experiences in relation to those attributes. To identify the underlying drivers of satisfaction and morale, we correlate the ratings on workplace experiences with ‘gut feel’ questions where employees rate their overall satisfaction with working with their employer and their work morale.

Through this analysis we are able to confirm that employee satisfaction and morale are linked but not the same concepts:

  • The highest correlation coefficient is 0.715 and the lowest 0.383 across the 8 organisations (note: a correlation coefficient of 0.3 or more indicates a positive relationship). A correlation coefficient of at least 0.95 would indicate that these two constructs are the same. None of the coefficients in Chart 1 are close to 0.95, indicating that although the two concepts are linked, there are important differences to be discovered.

Chart 1: Correlation coefficients measured between Employee Satisfaction and Morale

Drivers of Employee Satisfaction and Morale

Analysing the results of all 8 organisations, we found only one attribute “using my skills and abilities in the job” correlated strongly with employee satisfaction. 

Many attributes, however, correlated strongly with employee morale namely:

  • Confidence in senior management’s abilities

  • Strong leadership from the management team

  • Having a clear direction for the organisation

  • Two-way communication between managers and employees

  • Open and approachable managers

  • Management follow through

  • Recognition for a job well done

  • Regular performance feedback

  • Customer focus

  • Pleasant atmosphere and workplace

  • Pride in the organisation

The gaps in meeting employee expectations on these items, particularly those relating to leadership, how people are managed and recognised[1], were much greater than the gap for “using my skills and abilities in the job”.  Hence, the paradox. Employees feel satisfied doing their job because they are mostly using their skills, while they believe that the performance of managers and the organisation does not meet their expectations to a great degree.

Furthermore, there were two other important findings that emerged from the analysis:

  • Where employees felt they were managed well and recognised, there was a greater possibility that they experienced high morale.

  • Where employees believed they were using their skills and abilities in the job, they were most likely to be highly satisfied with their work.

Finally, an important item that affects both employee satisfaction and morale is employees “feeling valued and respected”.  We have discussed this particular aspect of employee satisfaction extensively in our article on management communication[2]. It appears to be the ultimate outcome of effective two-way communication between managers and employees.

[1] A zero gap assumes employee expectations are met by their experiences at work.  Gaps range from –36 to –24 for attributes relating to leadership, how people are managed and recognised.  “Using my skills and abilities in the job” has a smaller gap of –19.
See article How communication can improve productivity

So what does this all mean?  While employee satisfaction and morale are related concepts they do not measure the same dynamic in organisations.   From an employee point of view, the findings are captured in the statement: “I love my job.  It’s just a pity how I’m managed”.

To achieve employee satisfaction, organisations need to ensure:

  • Employees’ skills and abilities are matched to their jobs

  • Employees have challenging and interesting jobs

Employee morale will need to be addressed through ensuring:

  • Senior management provide strong and clear leadership

  • Employees are involved in two-way communication with managers where they provide feedback on important decisions and receive regular performance feedback and recognition

  • The organisation has a healthy focus on customers

  • Employees have a pleasant work environment

By addressing both employee satisfaction and morale, it is expected that ultimately employees will feel valued and respected and have pride in their employers.  Currently, it appears that organisations are better at achieving employee satisfaction and less successful at ensuring high employee morale.

Our findings are based on research conducted between 2000 and 2002 with over 6,500 employees across the following organisations:

Organisation Type

Commercial Business to-Business service & product providers (3)

Education organisation

Internal Shared Services organisation (1)

Public Sector organisations (3)

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© The Ryder Self Group 2003


The Ryder Self Group
Ph: 0412 426 553