Workers want trust, not money

It may be both cheaper and more effective for employers to try to boost job satisfaction and trust than to increase their pay, according to a new study of Canadian workers John Helliwell and Haifang Huang. Published as NBER working paper No. 11759, How's the Job? Well-Being and Social Capital in the Workplace, the authors find that workers highly value task variety, skill intensity, having enough time to do the job and a work environment where they trust their boss. As the authors conclude:

The well-being results show strikingly large values for non-financial job characteristics, especially workplace trust and other measures of the quality of workplace social capital. The compensating differentials estimated for the quality of workplace social capital are so large as to suggest that they do not reflect a full equilibrium. Thus the current situation probably reflects the existence of unrecognized opportunities for managers and employees to alter workplace environments, or for workers to change jobs, so as to increase both life satisfaction and workplace efficiency.

Chris at Stumbling and Mumbling, who brought the paper to my attention, adds an important caveat:

One reason why it requires huge rises in income to compensate us for falls in job satisfaction is that our happiness doesn't rise much with incomes.

A full PDF of the paper is also available here for those who don't have access to NBER papers.

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