Studies of workplace learning tend tofocus on largefirms even though small businesses constitute 98 percent of u. s. firms. Recent studies have found evidence of extensive HRD in small businesses. Other recent studies found a higher level of job satisfaction among employees of small firms than employees of larger firms. This study measured the nature and extent of HRD; the level ofjob satisfaction among workers; and determined the correlation between workplace learning activities and job satisfaction in small to mid-sized businesses.
This study is also looking at cross-country comparisons and . mplications with Australia. Malaysia is a resource rich country and a major socio-economic force in the AsiaPacific region. Historically, the economy of Malaysia was based on agriculture and natural resources. Over the past 25 years, the pace of development of the Malaysian economy has been rapid. Throughout the 1980s and early 90s, the economy grew at an average annual rate of 7. 8 per cent. Strong growth in public investment and exports during this period stimulated domestic demand and contributed to a consistent rise in income and employment.
But the Asian economic recession of the late 1990s and the severe worsening of ! v1alaysia’s external terms of trade led to a general slow-down in the growth performance. Various adjustment measures were used by the Government to restore balance and stability. The economy now appears to be emerging from the recession and recording GDP growth rates around 4 per cent per annum. In its efforts to transform Malaysia to a dev~loped and industrialized country, the Government began to focus on developing human resources.
In recognizing the need for training government employees and to set an example for business and industry the National Institute of Public Administration, Malaysia (INT AN) was established in 1972. To further encourage and stimulate the private sector to introduce training and development for its employees, the Malaysian Legislature passed an Act of Parliament entitled Human Resource Development Act 1992. This legislation requires a manufacturing company which has more than fifty employees to contribute one per cent of its monthly payroll to a fund which would then be used to promote training.
Wan (1994) reports that until these relatively recent undertakings “enterprise training in Malaysia received little attention from policy makers. Even now not much is known about it, despite the fact it is one of the most important sources of job-specific skill development”. In fact, Chalkley (1991) reports that the realization of the importance of training is a recent concept in Asia. The companies tackling such problems represent the exception rather than the norm. On average, companies in Malaysia and Indonesia undertake more training days than their counterparts in Singapore and Hong Kong, but spend less.
This is because management training receives greater emphasis in Hong Kong, South Korea, and Singapore, while in Volume 4 Page 127 CLWR 7th Annual International Conference on Post-compulsory Education and Training, 1999 Malaysia there is a greater emphasis on skills training, which is generally cheaper to organize. The estimates are that Malaysia spends an average of US$200 on training per employee per year. By comparison, British firms invest approximately US$5,000 annually per employee and Germany invests an average of US$7,500 annually per employee. U. S. irms invest, on average, US$l ,800 per year per employee in training and development, or by another estimate a total of US$60. 7 billion a year.
Furthermore, estimates suggest that about 8 percent of new employees receive formal training in their first year of employment in U. S. firms and 20 percent of new employees receive such training in European firms, and 74 percent receive such training in Japanese firms. Developing the human resources of a company would seem to be key to increasing production and closing the gap between the level of worker skill and present and future needs.
Businesses that have made training, education, and development a priority have seen it payoff through greater profitability and increased worker job satisfaction. Recent studies have found that job satisfaction is rarely tied to pay and promotion; but rather, workers are more interested in such things as feeling appreciated, being “in on things,” and career development all of which have linkages to workplace learning. Job satisfaction is simply how people feel about their jobs and different aspects of their jobs.
There are important reasons why organizations should be concerned with job satisfaction, which can be classified according to the focus on the employee or the organization. First, the humanitarian perspective is that people deserve to be treated fairly and with respect. Job satisfaction is to some extent a reflection of good treatment. It also can be considered an indicator of emotional well being or psychological health. Second, the utilitarian perspective is that job satisfaction can lead to behavior by employees that affects organizational functioning, as well as a reflection on organizational functioning.
Differences among organizational units in job satisfaction can be diagnostic of potential trouble spots. Each reason is sufficient to justify concern with job satisfaction. Combined they explain and justify the attention that is paid to this important variable. Indeed, Buhler (1994) emphasizes the point when she talks about the continued effort organizations must place on employee satisfaction and the economic importance to the company. “Organizations that believe that workers are easily replaced and do not invest in their workers send a dangerous message.
This often results in high turnover, which is accompanied by high training costs, as well as hiring costs it fosters the same type of attitude in the employee, that the company can be- replaced and little loyalty is felt”. These studies make it clear that companies must take advantage of all workplace learning opportunities if they are to remain successful. However, until recently, most studies like the ones by Coblentz (1988), Beatty (1996), and Hitt (1998), for example, have been conducted in large corporations. Few firms in the samples have had annual sales of less than US$l billion.
Most U. S. businesses are small to mid-sized with annual sales well under US$lO million (Lee 1991). No exact figures are available on the nature and extent of small businesses in Malaysia, but it is clear that they constitute a substantial part of the overall economy.
In the same year, their contributions to total manufacturing output and employment amounted to 15 percent and 18 percent, respectively. Small businesses are playing an increasingly important role in the world economy as well. Small businesses (those employing 100 people or less) constitute 98 percent of U. S. businesses and “small businesses are responsible for 82 percent of the jobs created in the United States”. Yet, of the more than six hundred thousand small businesses started each year in the U.S. , 80 to 85 percent fail in the first five years (Small Business Handbook 1990).
The economic wel,l-being of some regions of the United States is dependent upon small businesses where the majority of businesses (88 percent) employ fewer than 200 people. To date, little is known about the relationship between workplace learning and employee satisfaction in small to mid-sized companies. Studies by Des Reis (1993) and Rowden (1995) have found that such firms may not even he aware of the nature and extent of learning in their workplaces.
Yet it is likely that the success of such companies is at least attributable to the ways in which employees are attended to, formally and informally trained, and developed. Statement of the problem Conventional wisdom says that small businesses do not have the financial resources nor the time to do very much, if any, training and development or workplace learning. These views on training in small businesses have generally been supported each time quantitative research has been conducied in a variety of small businesses. However, a recent qualitative study found that, in fact, U.S. small businesses do engage in a considerable range of formal, informal, and incidental workplace learning, activities. The information gleaned from the interviews, observations, and documents provide a new foundation upon which questionnaires can be developed that can assess the extent of workplace learning from a perspective that small businesses truly understand. Another recent study found that workers in U. S. small businesses were generally more satisfied with their employment situation than were workers in larger companies.
The study found that 44 percent of the workers in small businesses said they were “extremely satisfied” with their jobs, compared with 28 percent at companies with 1,000 or more workers. It was speculated that factors such as job security, empowerment, and the ability to do what they do best might explain job satisfaction. While workplace learning was not one of the indicators in the study, the respondents reported that they could learn and grow on the job. An assumption of this study is that a sense of satisfaction a person feels about his or her employment can be directly linked to workplace learning.
That is, employees who have opportunities to grow and learn in their job will express higher levels of job satisfaction. To test this assumption, this study first established the nature and extent of workplace learning in small to mid-sized businesses; established the level of job satisfaction reported in the same small to mid-sized businesses; and established the relationship between these learning opportunities and the level of employee satisfaction in these organizations. Volume 4 Page 129 CLWR 7th Annual International Conference on Post-compulsory Education and Training, 1999 Purpose and research questions
The overall purpose of this study is to understand workplace learning in the Malaysian context. The specific research questions are: 1. 2. 3. What is the nature and extent of workplace learning in small to mid-sized Malaysian businesses? What is the relationship among three types of workplace learning (formal, informal, and incidental) in the Malaysian context? To what extent do those three types of workplace learning explain job satisfaction? Methodology A survey research design was deemed the most appropriate way to understand the relationship between workplace learning and employee job satisfaction.
A survey instrument was developed that captures the essence of the findings on workplace learning revealed by the Rowden (1995) study combined with the Spector Job Satisfaction Survey (1997). Description of the sample Five Malaysian companies agreed to participate in the study. Potential companies were identified through contact with the local university. Students from the HRD program at the university administered the surveys at the companies. A total of 228 surveys were returned. The five companies consisted of a manufacturing firm, two financial services firms, an educational/training company, and a non-government organization (NGO).
The manufacturing firm has been in business for 11 years, employs 54 people, and has gross annual revenues of RM 3, 000,000 (RM [ringgitt] 3. 8=$1 USD at the time of this writing). The financial services companies have been in business for around 10 years, employ a combined 150 people, and produce annual gross revenues of RM 360,000,000. The training company has been in business for eight years, employs 100 people, and has gross revenues of RM 3,000,000. The NGO has been in business for 12 years, employs 124 people, and while it does not generate revenue it has an annual budget of RM 2,000,000.
All the respondents worked full time. Fifty two percent were female. Eighty seven percent were between the ages of 21 and 44. Sixty percent were married. Thirty eight percent worked at companies with fewer than 100 employees and 59 percent worked for companies that employed between 100 and 200. Eighty six percent have been employed by their current company for less than 10 years. Sixty five percent are non-supervisory and 69 percent earned between RM $1000 and RM $3000 per month. Seventy four percent worked in service industries while 26 percent worked in manufacturing.
A description of the respondents is contained in Table 1. Instrument There is limited research on HRD in small to mid-sized businesses. Most people believe that small businesses do little, if any, development of their workers. For example, Training Magazine, which annually conducts a study of the training industry in the U. S. annually, does not even attempt to contact businesses with fewer than 100 employees and only 16 percent of their sample consist of companies with between 100 and 500 workers. Even the Malaysian HRDA ignores manufacturing firms with fewer than 50 employees.
Volume 4 Page 130 CLWR 7th Annual InternationalcConference on Post-compulsory Education and Training. Several attempts have been made to determine the nature and extent of workplace learning in small business. Invariably, the studies concluded that, in fact, little HRD occurs in small businesses. A review of several of the studies determined that a likely cause of the lack of discovery of workplace learning in small businesses was due to the design of the surveys.
A qualitative study by Rowden did reveal numerous indices of workplace learning in small to mid-sized businesses in the U. S. By looking at the field notes and transcripts of interviews of workers, it was believed that previous attempts to capture workplace learning in small to mid-sized businesses was due in large part by the language of the questionnaire. Making every attempt to stay as close as possible to the language and references used by actual workers in small to mid-sized businesses, a survey was developed to attempt to capture the natu”re and extent of workplace learning in these businesses.
The research on job satisfaction in small businesses mirrors that of HRD in small businesses. Until a recent study little attention had been paid to worker job satisfaction in small businesses. This study found that workers in small businesses, generally, were more satisfied with their work than were workers in larger businesses. The study did not, however, seek to determine why the workers were more satisfied. The study mentioned ideas like better communication, a feeling of being in on things, and a smaller power distance-but no factors were actually measured.
Again based on the Rowden (1995) study, a possible connection could be made between workplace learning and job satisfaction. To determine if this hypothesis were true, workplace learning and job satisfaction would have to be measured in the same small businesses. Then, correlational measures could be made to determine if small to midsized businesses with high measures of workpiace learning also had high measures of job satisfaction.
The Spector (1997) Job Satisfaction Survey was determined to be the best-validated and reliable instrument for determining job satisfaction. A modified version was incorporated into the questionnaire along with request for background data. , Once developed, the instrument was subjected to critique sessions by area experts and graduate HRD classes to ensure for content validity. The process was continued until saturation was reached; that is, until no more distinct categories could be ascertained. The Malaysian version required some modification for cultural differences.
For example, religious education had to be added since this is often provided for by Muslim employers and the “married-not married” question had to be expanded to cover all possibilities since feedback indicated “not married” sounded too much like a “curse” to them. The results of the development process was a six page self-administered questionnaire. The instrument is divided into three sections-workplace learning, job satisfaction, and background information. The three constructs or dependent variables for the workplace learning portion were formal, informal, and incidental learning.
The reliability for each measure was conducted using Chronbach’s alpha. The formal learning scale included items measuring respondent’s perceptions of planned, organized, training activities. The informal learning scale included items measuring respondent’s perceptions of unplanned or spontaneous activities that lead to perceived learning on the job. The incidental learning scale included items designed to measure respondents perception of normal workplace activities that resulted in learning even though that was not the purpose of the activity.