The influence of employability on

employee performance and employee

commitment and the effect of the type of

contract on these relations.

Director to HR manager: "What if we invest in our people and then they go away?

HR Manager: “What if we do not invest and they stay?”

Bachelor Thesis Human Resource Management

Author Amarins Nonhebel (848097)

Supervisor René Schalk

Project period January 2016 until May 2016

Abstract

Employability is a concept whose advantages, disadvantages and other consequences are still

ambiguous. The concept is often related to employee performance and employee commitment.

The question whether to stimulate employability or not is often debated in human resource

management. The so-called management paradox states that employability relates to positive

performance, but also to reduced commitment. This research examines this paradox. The theory

based hypotheses of this research state that the extent to which a manager promotes

employability stimulates employee commitment and employee performance. Moreover, the

relationship between employability and commitment was expected to be stronger and the

relationship between employability and performance was expected to be weaker for employees

with a temporary contract. Data to examine these relationships was gathered cross-sectional

and cross-national by administering questionnaires among 5345 respondents. The expectation

that employability leads to better performance and more commitment was confirmed within

this research. However, the expectation that the type of contract has an effect on these relations

was not confirmed within this research. Practical implications on the use of employability for

employee commitment and performance are discussed.

Keywords: employability, employee commitment, employee performance, type of contract,

social exchange theory, management paradox.

Introduction

Unemployment has been increasing in the European Union since 2008 as a result of the global

economic crisis. The figures for unemployment in the Netherlands are increasing from a total

percentage of 3.7 in 2008 to a total percentage of 6.9 in 2015 (Central Bureau for Statistics,

2016). In times of crisis and unemployment, employability is getting more important to prevent

unemployment. Employability is a concept of being capable of getting and keeping fulfilling

work (Hillage & Pollard, 1998) and it has received an increasing amount of attention over the

past years (Thijssen, van der Heijden, & Rocco, 2008). Lifetime employment used to be the

standard, but the labour market is changing and is becoming more flexible. When an employee

is employable, it increases the chance to find and keep a suitable job. In other words, the need

to be employable increases (Thijssen et al., 2008).

Besides the capability of getting and keeping fulfilling work, employability can be

described as the possibility to survive in the internal or external labour market (Thijssen et al,

2008). The question whether to stimulate employability or not is often debated in human

resource policy (De Cuyper & De Witte, 2011). On the positive side, employability leads to

positive outcomes for both career and firm (van der Heijde & van der Heijden, 2006).

Negatively, employability may increase the self-interest of employees (De Cuyper & De Witte,

2011). Hence, employability leads to the so called management paradox (van der Heijde & van

der Heijden, 2006). This paradox describes the idea that employability relates to performance,

but also to reduced commitment. The higher one’s employability, the higher one’s perception

about other available jobs which increases the change of employable employees taking another

job (van der Heijde & van der Heijden, 2006).

Based on the management paradox, this research will argue that employability leads to

a situation wherein employees are less committed but performance increases and that these

relations are dependent of the type of contract of the employee.

Employee commitment has often been related to employability (Fagiano, 1993;

Waterman, Waterman, & Collard, 1994; Iles, Forster, & Tinline, 1996; Estienne, 1997; Galunic

& Anderson, 2000; Craig, Kimberly, & Bouchikhi, 2002). Employee commitment is defined as

a strong belief in the organization's goals and values, a willingness to exert considerable effort

on behalf of the organization, and a strong desire to remain a member of the organization

(Mowday, Porter, & Steers, 1979). The relation between employability and employee

commitment has been studied several times, but it remains vague to what extent employability

influences employee commitment. Greater employability can both have a positive and negative

effect on employee commitment. Employability is beneficial for employees because of their

increased value, both on the internal and the external labour market (Schotman, 2012). For

employers, it is a risk to invest in employability when the value of their employees for other

companies will increase and their commitment to the organization will not increase at the same

time. This risk will not apply when an investment in the employability of employees leads to

more employee commitment of those employees (Schotman, 2012). Hence, employee

commitment is important on both the individual employee level and on the company

performance level. In fact, employee commitment has been recognized as one of the major

determinants of organizational effectiveness (Schein, 1970; Steers, 1975), higher levels of job

performance, lower absenteeism, and lower turnover (Mowday et al, 1979, 1982; Porter et al,

1976; Steers, 1977; Koch & Steers, 1978; Angle & Perry, 1980; Price & Mueller, 1983; Fukami

& Larson, 1984, as cited in Bush, Fallan & Petterson, 1998). Moreover, highly committed

employees report better well-being, including higher job satisfaction; better mental and physical

wellbeing (Siu, 2002).

The third variable from the management paradox (2006) is employee job performance.

Employee job performance is defined as the total expected value to the organization of discrete

behaviors that an individual carries out over a standard period of time (Motowidlo, 2003).

Employee job performance is a broad concept that also defines performance outside the core

activities, like performance in training programs, absence and creativity (Ng & Veldman, 2008).

The relationship between employability and performance can be explained through social

exchange mechanisms and reciprocity. The employer makes an effort to invest in employability,

and in turn the employee feels obliged to give something in return (de Cuyper & de Witte,

2011).

In addition to employability, employee commitment and employee job performance, the

influence of the type of contract (permanent and non-permanent) is investigated in this research,

as previous research showed that the type of contract can be of significant influence on the

relationship between employability and employee commitment (De Cuyper, Notelaers & de

Witte, 2009). De Cuyper, Notelaers and de Witte (2009) found a significant negative

relationship between employability and employee commitment for temporary workers, where

this was not significant for permanent workers. Little is known about the influence of the type

of contract on the relationship between employment and employee job performance, so there is

a possibility to extend this information. Therefore, the type of contract is included in this

research.

The aim of this research is to investigate the relationship between employability,

employee job performance and employee commitment and the role of the type of contract on

this relationship. Employability is an upcoming concept that is believed to have an influence

on both employee commitment and its multiple positive individual and organizational outcomes

and on employee job performance. The relationship between employability and employee

commitment is often investigated but a clear conclusion is still missing. Opinions are also

divided about the relationship between employability and employee job performance. It is still

unclear about the influence of type of contract on the relationship between employment and

employee commitment and the relationship between employment and employee job

performance.

Next to the scientific relevance of adding additional knowledge about this topic, this

study also has practical implications, since it will aid managers to make a decision about the

investment in employability. Employability can be both positive and negative in certain

situations and the type of contract could be a condition that will make the difference. For

managers, being able to make the right decisions will generate maximum benefit from the

positive consequences of employee commitment and will reach maximum employee job

performance. The result of this research will create broader and deeper knowledge about this

subject.

Thus, the research question is formulated as:

“To what extent is employability related to employee commitment and employee performance,

and how does the type of contract influence these relationships?”

The following section will argue the effect of employability on the commitment and

performance of employees and to what extent these relations are dependent of the type of

contract of the employee. After studying these relationships, four hypotheses will be

formulated. Lastly, the conceptual model will be presented.

The relationship between employability and employee commitment

Employability

According to Thijssen, van der Heijden and Rocco (2008), many different definitions are used

for employability. Generally, employability helps workers to survive on the internal and

external labour market by actively adapting to the changes on the labour market and the career

opportunities that arise (Fugate, Kinicki, & Ashfort, 2004) (Thijssen, van der Heijden, & Rocco,

2008). There are two forms of employability; internal and external employability (Schotman,

2012). Internal employability refers to the employees’ estimated chance of a better or different

job within the current organization, whereas external employability refers to the employee’s

estimated chance of a better or other job with another employer (Schotman, 2012). During the

past decades, the labour market changed and attention to employability has increased because

of this (Thijssen, van der Heijden, Rocco, 2008). Formerly, it was the standard for employees

to be employed at the same organization for a lifetime. However, organizations these days have

to deal with more and faster changes in and outside the organization than before. For this

reason, they are in need of flexible labour, which leads to a greater turnover in employees

(Baruch, 2001). Employability is a reaction to this new labour market. Instead of a stable

workplace and long-term commitment, an employer can now promise employability to his

employees, so they are more attractive for other employers when they have to leave the

organization which makes it easier to switch jobs (Baruch, 2001). Employees that are

employable can survive and satisfy current job demands and qualifications because of their up-

to-date knowledge and skills. (Thijssen, van der Heijden, Rocco, 2008).

Employee commitment

The concept of employee commitment has evolved over the years. Where Becker (1960, p.33)

described employee commitment as “the tendency to engage in consistent lines of activity

because of the perceived costs associated with leaving the organization,” Mowday, Porter, &

Steers (1982, p.26) defined the concept as “the relative strength of an individual’s identification

with and involvement in an organization” and made a distinction between attitudinal and

behavioral commitment. Two decades later, Siu (2002) made another division of the concept

and argued that employee commitment can be divided in three subjects: An acceptance of the

organization’s goals, a willingness to work hard for the organization, and the desire to stay with

the organization. This last definition will be used in this paper.

The social exchange theory

The relationship between employability and commitment can be explained through the social

exchange theory. The social exchange theory sees the relationship between employee and

employer as an exchange of interactions between multiple actors that are made in a state of

mutual interdepence that generate obligations (Blau, 1964) (Emerson, 1976). Thus, social

exchange theory explains that if one does something for you, you feel obliged to do something

for him in exchange, which balances each other out. When the employer invests in the

employability of his employees, this will have an effect on the exchange relation between

employer and employee as the employee will try to balance this relation by giving something

in return (Schotman, 2012). According to social exchange, a series of interactions between

employee and employer will evolve into trust, loyalty and mutual commitment (Cropanzano &

Mitchell, 2005). Thus, employees will repay their employers when they invest in employability,

through their level of commitment.

Previous research has found a positive influence of employability on employee

commitment. In a study conducted by Schotman (2012), it was concluded that internal

employability has a significant effect on employees’ affective commitment. This means that

employees who have a high estimated chance of another or better job at the same organization,

experience a higher emotional involvement and are more committed. Moreover, a study of

Benson (2006) stated that organizational and employee commitment was higher when spending

more days in an on-the-job training. Additionally, De Graaf, Peeters, & van der Heijden (2011)

stated that on-the-job training is a positive predictor for employability when the training is

attended in an adjacent area of expertise and in a study conducted by Benson (2006), on-the-

job training was found to have a positive effect on the employee commitment of employees.

The aforementioned leads to the following hypotheses:

H1: The more employable an employee is, the more committed to the organization he will be.

The effect of the type of contract on the relationship between employability and employee

commitment.

Types of contract

Most employees still have a full-time, open-ended employment contract, but the group of

employees with alternative employment options is growing (Bernhard-Oettel, Sverke, & de

Witte, 2005). Alternative employment options, that is other than full-time, exist in different

forms. First, there is fixed-term employment for the duration of a project or as a temporary

replacement. Secondly, there is temporary agency work where employees are involved in a

tripartite employment relationship: they are employed and hired out by the agency to perform

work at an organization. Thirdly, on-call employment where employees fill in short-term

vacancies for a limited number of hours or days (Bernhard-Oettel, Sverke, & de Witte, 2005)

(De Cuyper, Notelaers, & de Witte, 2009). This growth in temporary employment is related to

the emergence of boundaryless careers and a growing demand for career flexibility (Forrier &

Sels, 2003). This trend can be both positive and negative. On one hand, temporary employment

can be seen as a way of freedom for employees because they are not tied to one employer,

whereas it is also positive for organizations because it provides them with flexibility on the

labour market. On the other hand, temporary employment affects employees negatively in terms

of more job insecurity (De Cuyper, Notelaers, & de Witte, 2009).

Temporary work, employability and commitment

As a reaction to the growth in temporary work, more temporary employees will choose to invest

in employability to protect their labour market position since lifetime employment is no longer

the standard (Forrier & Sels, 2003). This may mean that employability is more related to

temporary workers compared to permanent workers (De Cuyper, Notelaers, & de Witte, 2009).

Temporary employees also have a higher exit probability and for this reason it can be expected

that temporary employment leads to under-investment in human capital from both the side of

the employer and employee (Forrier & Sels, 2003). Becker (1964) stated in his Human Capital

theory that both employee and employer are only willing to carry the costs of training if they

can recoup their training. Herefore, it is expected that employers are less willing to fund training

for their temporary employees and temporary employees are less willing to invest in training,

since the chance they can regain this investment with their current employer is small. Agency

workers, for example, are not employed by the company they work for, but at the agency office,

so their employer will be less inclined to invest in training. Long-term temporary workers will

get more access to training in comparison to short-term temporary workers, since their exit

probability is lower (Forrier & Sels, 2003). In addition, it is expected that temporary employees

with a good chance to move into a permanent job will receive more funded training in

comparison with their temporary co colleagues with a smaller chance at a permanent job

(Forrier & Sels, 2003). For this reason, it is expected that temporary employees participate less

in training than permanent employees and are therefore less developing their employability

(Forrier & Sels, 2003).

Along with the increase in temporary work, warnings about disadvantageous effects for

the individual arose. This development can be shown through the flexible firm model by

Atkinson (1984). This model states that temporary workers are associated with the

organization’s periphery and permanent workers with the core of the organization. The

periphery workers are the nonpermanent workers with no benefits and poor working conditions,

such as less job security and less opportunities for training and development. Their jobs are

designed for a quick and easy transfer of workers with minimal investment from the employer

(De Cuyper, Notelaers, & de Witte, 2009). In contrast, the core workers are crucial to the

organization and are therefore assigned to the most stable jobs with mostly a permanent

contract. (De Cuyper, Notelaers, & de Witte, 2009). This core – periphery model is assumed to

result in negative consequences for temporary employees, for example lower levels of job

satisfaction and lower levels of employee commitment (Mauno, Kinnunen, Mäkikangas, &

Nätti, 2005).

In conclusion, the type of contract can have different effects on the relationship between

employability and employee commitment. De Cuyper, Notelaers, and de Witte (2009) state that

employability is more related to temporary workers compared to permanent workers. Moreover,

Forrier and Sels (2003) expect temporary employees to participate less in training in

comparison with permanent employees which less develops their employability. Furthermore,

Mauno, Kinnunen, Mäkikangas and Nätti (2005) state that the core – periphery model results

in lower levels of employee commitment for temporary employees.

There is empirical evidence that shows that the type of contract influences the

relationship between employability and commitment, but there are few studies about

employability in relation to temporary and permanent experiences. Also, results and findings

of those few studies are contradictory (De Cuyper, Notelaers, & de Witte, 2009). For example,

De Cuyper, Notelaers and de Witte (2009) found a negative relationship between employability

and affective employee commitment for fixed-term contract workers and temporary agency

workers, but this relationship was not significant for permanent workers. In contrast, McDonald

and Makin (2000) found that nonpermanent employees were actually more satisfied with their

jobs and more committed to their organization than their permanent colleagues. However, De

Cuyper & de Witte (2006) did not find clear-cut differences between temporaries and

permanents on employee commitment.

The aforementioned leads to the following hypotheses:

H2: The relationship between employability and employee commitment is stronger for

employees with a temporary contract.

The relationship between employability and performance

Job performance is a central subject in organizational psychology. Viswesvaran and Ones

(2000) defined job performance as the scalable actions, behavior and outcomes that employees

engage in or bring about that are linked with and contribute to organizational goals. Job

performance is an important indicator in the hiring and selection process, as the employees who

are likely to perform better on the job are preferred and are more likely to get selected. Next to

that, training and assessment programs are designed to improve job performance (Viswesvaran

& Ones, 2000). \

The social exchange theory

The relationship between employability and job performance can be explained through social

exchange mechanisms. As explained before, social exchange theories involve reciprocity:

investments from one party are returned by investments from the other party. It defines an

exchange of a series of interactions between employer and employee; the employer makes an

effort to invest in employability, and in turn the employee feels obliged to give something in

return by delivering a better performance (de Cuyper & de Witte, 2011). Several studies have

confirmed this theory. For example, Van der Heijde and van der Heijden (2006) found that

employability is advantageous for both present performances on-the-job as well as career

outcomes, which is long-term performance. Moreover, Stoffers and van der Heijden (2009)

argued that stimulating and investing in employability is expected to contribute to

organizational performance.

Based on the assumptions mentioned above, on the relationship between employability and

employee job performance, the following hypothesis can be formulated:

H3: The more employable an employee is, the better his job performance will be.

The effect of the type of contract on the relationship between employability and employee

performance.

As mentioned before, there is a connection between type of contract and employability. De

Cuyper, Notelaers, and de Witte (2009) state that employability is more related to temporary

workers compared to permanent workers, Forrier and Sels (2003) expect temporary employees

to participate less in training in comparison to permanent employees and in this way less

developing their employability and performance. De Cuyper & de Witte (2006) did not find

clear differences between temporary workers and permanent workers on self-rated

performance. Pearce and Randel (1998) also found no differences between temporary and

permanent workers in their levels of job performance in their study with a small sample of

highly specialized contract workers. However, Ang and Slaughter (2001) did find a relationship

between type of contract and performance. They argued, based on a small Singapore sample of

information systems workers, that supervisors make a difference in the rating of performance

between temporary and permanent workers. In addition, Guest (2004) found that work

performance of temporary employees is rated lower than that of permanent employees

The aforementioned leads to the following hypothesis:

H4: The relation of employability and performance is weaker for employees with temporary

contracts.

Resulting from the aforementioned information, the following conceptual model can be

developed:

Figure 1. Conceptual model.

Method

Participants and procedure

This research had a cross-sectional and cross-national design and the population consisted of

employees of different participating countries. The requirements to participate in this research

were: 1) they had to have a permanent or temporary contract and 2) they had to work in one of

the following sectors: Food industry, Education or Retail. The following criteria for the choice

of sectors were used: Has to be present in all participating countries, a reasonable amount of

temporary employed employees can be found within the sector, sectors represent a broader class

of organizations and they are likely to be important in terms of future employment (de Cuyper,

de Witte, Rigotti, & Mohr, 2004). All respondents in the sample of this research (N=5345) met

these requirements and were used for the research. 62.7 percent of the respondents had a

permanent contract (n=3351) and 37.3 percent had a temporary contract (N=1993). There was

a small over-representation of female respondents, the number of male respondents was 2370

(44,3%) and there were 2906 female respondents (54.4%). The average age of the respondents

was 37,1 years (SD = 11.5 years).

Data was collected using surveys to employees. In order to collect data, the researchers

either visited the organizations, distributed and collected the questionnaires or sent the

questionnaires to the organizations and they then managed this process (de Cuyper, de Witte,

Rigotti, & Mohr, 2004). Because of the cross-national design, attention had to be payed to the

translation of the questionnaires. In this process the following steps were taken. First, there was

searched for existing tested versions of the instrument in the requested language. When there

was no suitable version available, the translation process started. In all national teams, at least

one translator was employed using translation / back translation as technique. This is the most

efficient translation technique, as it yields to high informativeness, and high source language

transparency (Behling & Law, 2000, as cited in de Cuyper, de Witte, Rigotti, & Mohr, 2004).

After this translation process, outcomes were discussed and translation errors were solved

together with the team. Before distributing the questionnaires, a small test was conducted with

at least five persons per country to find out if there were still any mistakes or ambiguities in the

questionnaire. It was stated beforehand that the respondents had to comply with the two

previously described requirements in order to be selected for analysis. Within the sample frame

of the three sectors, further specifications were established. In order to be selected for the

research sample, people had to work as a professional within the education sector or as a blue

collar worker doing tasks in the core business of food industry plants. It was also stated that the

minimum sample of each country should be 600 employees and the respondents should be

approximately equally divided between the three sectors. In order to ensure that one

organization did not had too much impact on the final results, it was stated that one organization

can not represent more than 33 percent of the sector. This is the same for the subgroups of

permanent and non-permanent workers. Furthermore, at least five employees should have a

non-permanent contract in one organization and at least seven organizations per country per

sector should be sampled. Therefore, in can be concluded that the sampling method in this

research was convenience sampling in combination with stratified sampling. Respondents were

selected due to their convenient accessibility due to the fact that companies and organizations

had to be willing to participate in this study. Further, each set of questionnaires had to match

certain strata, due to the equal deviation between the three sectors, between the employees with

the different types of contract and because of the limited impact of 33 percent per organization.

The data was derived on the employee- and employer level. The data was gathered over a period

of 33 months, starting in December 2002.

Measures

Employability was measured using the scale employability by de Witte (2000). This scale

consisted of five items. An example of an item that measured employability was: “I am

confident that I could quickly get another job at about the same pay, without having to move

house.” Respondents answers were rated on a five point Likert-scale (strongly disagree to

strongly agree). None of the items in the employability scale was reversed, because they were

all formulated in the same direction. From the factor-analysis and in accordance with the scree

plot, it was found that the scale employability consisted of one component with an eigenvalue

of 3.005 and a KMO of 0.831. In addition, a reliability analysis was performed and resulted in

a Cronbach’s alpha of 0.889, which implies that the reliability was good. All items contributed

to the reliability.

Organisational commitment was measured using the employee commitment scale by

Cook and Wall (1980). This scale consisted of five items. An example of an item that measured

employee commitment was: “I feel myself to be part of the organization.” Respondents answers

were rated on a five point Likert-scale (strongly disagree to strongly agree). None of the items

in the employability scale was reversed, because they were all formulated in the same direction.

When factor analysis was performed, it was found that the scale organisational commitment

consisted of one component with an eigenvalue of 2.297 and a KMO of 0.771. The scree plot

confirmed this finding. In the reliability analysis, a Cronbach’s alpha of 0.679 was reported.

One item did not contribute to the reliability. When this item would be deleted, Cronbach’s

alpha would be 0.718. However, the results from the factor analysis show that this item is

contributing to the component of organisational commitment with a score of .437. For this

reason, it was decided to keep the item in the scale.

Performance was measured using the scale perceived performance by Abramis (1994).

This scale consisted of six items all starting with: “In your own judgement, how well did you

fulfil the following tasks?” An example of an item that measured performance was:

“Perform without mistakes?” Respondents answers were rated on a five point Likert-scale (very

badly to very well). From the factor-analysis and in accordance with the scree plot, it was found

that the scale performance consisted of one component with an eigenvalue of 2.891 and a KMO

of 0.801. During the reliability analysis, a Cronbach’s alpha of 0.784 was found and all items

contributed to this scale.

Type of contract was measured using the scale type of contract by Psycones (2007).

Respondents had to answer the following item: “Do you have a permanent contract with this

organization?” In this research, the only distinction is been made between respondent without

a permanent contract (no = 0) and with a permanent contract (yes = 1).

Four control variables were added to the existing model, to investigate whether these

variables influenced the relationships in the original model. These variables were gender, age,

educational level and intention to quit.

Firstly, Gender. Respondents had to answer the following item: “Are you…” where the

answer could be female or male. Hereby the number of males and females could be identified

and these numbers could then be used to control for gender. This variable was a dummy

variable, where the value 0 was for female and the value 1 for male. The influence of gender

on employee commitment is researched before. Marsden, Kalleberg and Cook (1993) found

that men tend to have slightly higher overall levels of employee commitment than women. Here

fore, gender was chosen as a control variable.

Secondly, Age. To find out what age the respondents were, they had to answer the item

“What is your age?” For analysis, this item was centred on zero. The choice of age as a control

variable was made because age and employability are often associated with each other in other

research. For example, Machielsen (2015) studied the influence of age on job crafting and found

that as people age they are less likely to craft by increasing demands, which decreases

engagement and employability.

Thirdly, Education. This question was different for every country, because every

country had to look for a measurement that could be transformed to the ISCED classification

of educational levels from 1 to 6. In this way, it was possible to measure results between

different countries, despite the different educational systems. This control variable can be

important for this research because it can have effect on type of job and the position in an

organization and therefore also on performance, employability and commitment.

Lastly, intention to quit. This concept was measured using the scale intention to quit by

Price (1997). The scale consisted of four items. An example of an item that measured intention

to quit was: “These days, I often feel like quitting.” Respondents answers were rated on a five

point Likert-scale (strongly disagree to strongly agree). One item in the intention to quit scale

was reversed, because it was formulated in a different direction than the other items that

measured this variable. For analysis, this item was centred on zero. This control variable was

chosen because previous research found a negative relation between intention to quit and

commitment (Loi, Hang-Yue, & Foley, 2006). It was striking to see that more than half of the

respondents (52.8%) answered very low on this scale with 1.00, 1.25 of 1.50.

Analysis

Employee commitment and performance were both regressed on employability and with an

interaction effect of type of contract with multiple regression analysis. Multiple regression

analysis was applied to the variables to test for significance and correlations.

Results

Descriptive results

In Table 1 the correlations, means and standard deviations of the variables are presented.

Employability was shown to have a significant positive relationship with performance (r = .096

, p < .01) . The positive relationship (r = .019) between employability and employee

commitment was not significant. Type of contract was shown to have a positive significant

relationship with both performance and employee commitment (r = .066, p <0.01; r = .079, p <

0.01), this means that employees with a permanent contract scored higher on performance and

employee commitment than employees without a permanent contract. This assumption is

checked and confirmed with a T-Test. Permanent employees had an average score of 4.07 (SD

= .51) on performance where temporary employees scored 4.00 (SD = .53). Permanent

employees also scored slightly higher on employee commitment with an average of 3.84 (SD

= .66) where temporary employees scored 3.73 (SD = .72). Type of contract and employability

were not significant related (r = -.017).

When considering the control variables, gender was not shown to have any significant

relationships, except for the positive relationship with type of contract (r = .029, p < 0.05). This

statement was tested with the Chi-Square test (p < 0.05). From all women, 61,36% has a

permanent contract where this is for men 64,20%. There is no credible evidence that there is a

difference between men and women on their level of performance or employee commitment by

employability. Age has significant effects on employee commitment (r = .165, p < 0.01),

performance (r = .121, p < 0.01), employability (- 0.207, p < 0.01) and the type of contract (r =

.329, p < 0.01). This suggest that when an employee gets older, he gets more committed, his

performance gets better, his employability decreases and the change that the employee has a

permanent contract gets higher. Educational level has a significant effect on employability (r =

.114, p < 0.01), gender (r = -.086, p <0.01) and age (r = .037, p < 0.01). In other words,

employees with higher education are expected to be more employable, older and men are higher

educated than women. Lastly, intention to quit has significant effects on employee commitment

(r = -.545, p <0.01), performance (r = -.253, p < 0.01), employability (r = .112, p < 0.01), type

of contract (r = .071, p < 0.01), age (r = -.081, p < 0.01) and educational level (r = 0.030, p

<0.05). This suggest that employees who are more intended to quit are less committed to the

organization, their performance gets worse, they are more employable, they are more likely to

have a permanent contract , they are younger and they are expected to have a higher educational

level. Only the correlation between employee commitment and intention to quit was strong

according to the criteria stated bij Pallant (2007), as a strong correlation should lie between .5

and 1.0.

All the variables presented in Table 1 were included in the regression analysis. The

variables were included to determine whether they have an effect on the assumed moderation

of type of contract on the relationship between employability and employee commitment and

the relationship between employability and performance.

Table 1.

Means (M), standard deviations (SD) and correlations (N=5345)

M SD 1 2 3 4 5 6 7 8

Employee

commitment¹

3,79 ,68 -

Performance¹ 4,04 ,52 ,360** -

Employability¹ 3,17 1,05 ,019 ,096** -

Type of

contract²

,63 0,48 ,079** ,066** -,017 -

Gender³ ,45 ,50 ,009 -,016 -,010 ,029

*

-

Age4 37,1

0

11,47 ,165** ,121** -

,207**

,329

**

,021 -

Educational

level5

4,14 1,52 ,001 -.026 ,114** .002 -

,086**

,037** -

Intention to quit¹ 1,84 ,90 -,545** -.253** ,112** .071

**

,013 -,081** ,030* -

**.Correlation is significant at the 0.01 level (2-tailed).

*. Correlation is significant at the 0.05 level (2-tailed).

¹ Measured on a 5 point likert-scale

² 0 = without permanent contract, 1 = with permanent contract

³ 0 = female, 1 = male 4 Measured as a continuous variable in years 5 Measured on a scale from 1 to 6

Testing the hypotheses

Using a multiple regression the hypotheses stated in this research were tested (Table 2).

Beforehand, there was checked for homoscedasticity using a scatterplot with the result that the

assumption of homoscedasticity was violated.

The first hypothesis was: The more employable an employee is, the more committed to

the organization he will be. This hypothesis was supported by the regression analysis, because

employability was shown to have a positive effect on employee commitment. However, this

effect was very small as you can see from the Beta and the explained variance. (β = .070, p <

0.001,). Model 2 showed an R2 change of .323. The explained variance (adjusted R square) was

.324 where 0.314 was explained by the control variables and only .011 by employability. The

part of the explained variance of employee commitment that is explained by employability was

significant, the effect from employability on employee commitment is significant. p <0.001.

The second hypothesis was stated as follows: The relationship between employability is

stronger for employees with a temporary contract. This hypothesis was not supported by the

regression analysis. Type of contract did have a positive significant effect on employee

commitment (β = .105, explained variance = .328, p < 0.001) which means that employees with

a permanent contract score higher on employee commitment. However, the interaction effect

was not significant. Model 3 showed an R2 change of .328. The part of the explained variance

of employee commitment that is explained by employability and type of contract was

significant, p < .001. However, the decreased influence of employability (β = .07 in model 2

and β = .06 in model 3) when adding type of contract to the model suggest that there is overlap

between these variables. The adjusted r square, which is the explained variance, is .328 where

only .005 is explained by model 3.

The third hypothesis was: The more employable an employee is, the better his job

performance will be. This hypothesis was supported by the regression analysis, because

employability was shown to have a positive effect on performance. However, again the effect

was very small as you can see through the beta and the explained variance (β = .077, p < 0.001,).

Model 2 showed an R2 change / explained variance of .099. The part of the explained variance

of organizational performance that is explained by employability was significant, p <0.001.

The last hypothesis was stated as: The relation of employability and performance is

weaker for employees with temporary contracts. This hypothesis was not supported by the

regression analysis. Type of contract did have a negative significant effect on performance (β

= .050, p < 0.01) which suggest that employees without a permanent contract would perform

better on-the-job. However, the interaction effect was not significant. Model 3 showed an R2

change of .100. The part of the explained variance of organizational performance that is

explained by employability and type of contract was significant, p < .001.

Table 2.

Regression analyses (N = 4756)

Model Organisational commitment Performance

1 2 3 1 2 3

β β β β β β

Gender .015 .014 .012 -.020 -.021 -.022

Age .007** .009** .007** .005** .006** 0.006**

Education .005 -.001 - 3.388E-5 -.008 -.015* -.015*

Intention to quit -.402** -.410** -.415** -.138** -.146** -.148**

Employability .070** .060** .077** .076**

Type of contract .105** -.050*

Type of contract

x Employability

.012 -.001

R2 31.3% 32.4% 32.9% 7.6% 10.0% 10.2%

∆ R2 .323** .328** .099** .100**

F 553.679

**

466.191

**

340.516** 99,77** 106,65** 77,80**

**p<0.001

* p<0.01

Discussion

In this study the following research question was examined: ““To what extent is employability

related to employee commitment and employee performance, and how does the type of contract

influence these relationships?” The results indicate that employability positively influences

employee commitment and performance. Furthermore, analyzes showed that type of contract

does not significantly influence these relationships. However, there where significant direct

effects from type of contract on employee commitment and performance.

These results were not in line with the expectations beforehand. The design of this study

was based on the management paradox (van der Heijde & van der Heijden, 2006), that explains

how employability reduces commitment and increases performance. However, this research

found that employability leads to both increased commitment and performance. A reason for

the unexpected findings can be that the concept of employability used in the management

paradox is too general. When performing research about employability, different aspects should

be taken into account. A distinction should be made between internal and external labour

markets because of the different results for these different labour markets. In addition, there

should be a difference between opportunities for all jobs, which is a quantitative measure, and

opportunities for desired jobs, which is a qualitative measure (De Cuyper & De Witte, 2011).

Because of these distinctions in labour market and available job opportunities, the concept of

employability has several definitions depending on various situations. Employability as one

concept is too comprehensive since the different kinds of employability can be different

predictors for performance and commitment.

The social exchange theory assumed that employability leads to higher employee

commitment (hypothesis 1) and that interactions between employer and employee are based on

reciprocity (Cropanzano & Mitchell, 2005). Previous research by Schotman (2012) found that

internal employability positively influences affective commitment. This hypothesis was

supported by the findings in this research, although the effect was very small. In this research,

the social exchange theory has proven to be a good predictor for the relationship between

employability and employee work engagement. The more an employer invests in employability

of his employees, the more the employee will repay his employer through his level of

commitment.

Subsequently, it was hypothesized that the relationship between employability and

employee commitment is stronger for employees with a temporary contract (hypothesis 2). De

Cuyper, Notelaers and de Witte (2009) found a negative relationship between employability

and affective employee commitment for fixed-term contract workers and temporary agency

workers, but this relationship was not significant for permanent workers. These findings do not

correspond to the outcomes of this research. There was no significant result found for the

interacting effect of type of contract on the relationship between employability and employee

commitment, herefore the hypothesis was not confirmed by the results of the analyses.

However, it was confirmed that employees with a permanent contract score higher on employee

commitment. These findings are not consistent with existing research, for example von Hippel,

Magnum, Greenberger, Heneman and Skoglind (1997) found that those individuals who hope

to gain a permanent job were more committed to the employer than those who were not hoping

for a permanent contract. A possible explanation for these outcomes could be the fact that most

employees with a temporary contract are not hoping to get a permanent job in the end.

Third, it was assumed from the social exchange theory that employability leads to higher

performance (hypothesis 3). The employer makes an effort to invest in employability, and in

turn the employee feels obliged to give something in return by delivering a better performance

(de Cuyper & de Witte, 2011). Previous research has confirmed this theory. For example,

Stoffers and van der Heijden (2009) argued that stimulating and investing in employability is

expected to contribute to organizational performance. The hypothesis was confirmed by the

analyses in this research with a small positive effect of employability on performance. The

social exchange theory was a good predictor for this relationship.

Finally, it was hypothesized that the relation of employability and performance is

weaker for employees with temporary contracts (hypothesis 4). Forrier and Sels (2003) expect

temporary employees to participate less in training in comparison with permanent employees

and in this way less developing their employability and performance. Guest (2004) stated that

work performance of temporary employees is rated lower than that of permanent employees.

The hypothesis was not supported by the results of the analysis. There was no significant result

found for the interacting effect of type of contract on the relationship between employability

and performance. However, type of contract did have a negative significant effect on

performance which suggest that employees without a temporary contract would perform better

on-the-job. This result is in line with existing literature, for example Forrier and Sels (2003)

expect temporary employees to participate less in training in comparison to permanent

employees and in this way less developing their employability and performance. Therefore it

can be expected that permanent employees would perform better on the job.

A setback in this study was the fact that no significant result was found for the effect of

the type of contract on the relationships between employability and commitment and

employability and performance. A possible explanation for this is the fact that while there exist

many forms of alternative employment, they have been studied as one group in comparison

with permanent employment in this research.

Limitations and suggestions for future research

This research had some limitations, which can be used as suggestions for future research. Data

was gathered using paper and pencil surveys. By using a questionnaire, the chance on social

desirable answers increases. Employees had to score themselves with a questionnaire on the

variables employability, commitment and performance. Consequently, there is a change that

employees do not want to admit that they are not employable, committed or performing badly

and therefore scores might be higher than they really are. Therefore, it is suggested that for

future research these variables will not only be measured by the individual themselves, but also

by the use of colleagues or supervisors opinions which decreases the effects of social

desirability and increases the validity of the research (Van Der Heijde & Van Der Heijden,

2005).

As mentioned before, it is suggested for future research to make a distinction in the types

of temporary contracts and to make a distinction in the types of employability while studying

this subject. Both concepts are comprehensive and this can cause errors in research when using

them as one concept instead of seeing the concept as a set of different sub components.

This study has a cross sectional design where data was gathered at one specific moment

in time. The downside of this is that no assumptions about causality can be made which means

that it cannot be concluded that a more employable employee will be more committed or will

perform better, since it can only be stated that these variables influence each other. Future

research might conduct longitudinal studies with multiple moments of testing in a longer time

frame. In that way, conclusions about causality can be made.

During the analysis, homoscedasticity was violated. This violation can lead to an

underestimation of the results.

Subsequently, the sampling method can be discussed. The sampling method used in this

research was convenience and stratified sampling. This implies that respondents were

approached based on ease of access. For this reason, the results of this study need to be

interpreted with caution since this study is not randomly conducted. The validity of this research

can be increased by the use of a random sample.

Next to that, it is recommended to increase the number of items that measure a variable.

In this research, some scales consisted of only four questions to measure a variable. Moreover,

future studies also need to incorporate casual workers to a higher degree and perhaps other

sectors.

Practical implications

This study has some practical implications that could contribute to the field of HR and the

performance of organizations and employees in the future. The two interviews with managers

revealed that employability is an increasingly important concept in nowadays business. Because

of the continuous changes in organizations, managers need employees who can adapt to this

continuous flow of movement and change in order to succeed. Employable employees are

becoming more needed and more important. Employees who can only perform one specific task

and do not want or are not able to learn anything else are becoming less valuable.

The increase of employability is likely to positively influence employee commitment. In earlier

research, committed employees are related to different positive outcomes, such as

organizational effectiveness, improved performance and improved well-being. The increase of

employability is also likely to positively influence performance. Therefore, employability is

beneficial for the organizational performance, individual performance and individual well-

being. It can be stated that increasing employability is an investment to consider for the

employer, as it can lead to these positive outcomes. It can be beneficial for organizations,

employers and employees to invest in employability. Human Resource Departments should

focus on the employability of their employees. For example, they should invest in training and

development in order to keep their employees up to date and ready for changes.

This study implies that employability could have many beneficial organizational

outcomes like increased employee commitment and better performance, employers across

countries and organizations could improve their performance by trying to invest in the

employability of their employees.

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Appendixes

Appendix 1 –Summary interviews Bachelor thesis

For my bachelor thesis I interviewed two employees. The first interviewed employee was

team manager expertise and advise at the big insurance company Univé. He managed a team

of 20 employees. The second interviewed employee was team manager culture and sport at

the municipality Steenwijkerland. She managed a team of 5 employees.

First, I explained the subject of my research. I explained the concept employability and I

explained my research question: “To what extent is employability related to employee

commitment and employee performance, and how does the type of contract influence these

relationships?”

They both expect that employability leads to more performance and more commitment. They

also expect that employees with a temporary contract will try harder to improve their

performance, in order to stand out in a positive way in comparison with employees with a

permanent contract. They expect a stronger relationship between employability and

performance for temporary employees and a stronger relationship between employability and

commitment for employees with a permanent contract.

When I ask for practical examples, they mostly start talking about the fact that permanent

employees are often reluctant to change. They experience employees with a permanent contract

as passive employees who find it difficult to adapt to changes in the organization. Those people

are less employable than people with a temporary contract who have an active attitude and are

open for changes.

They argue that organizations need different people nowadays. The manager at Univé has a

quote they use to explain this statement. ‘Panta Rhei’. This means everything flows, everything

is always moving and changing. To succeed as an organization, you need employees who can

adapt to this continuous flow of movement and change. Employable employees are getting more

needed and more important. Employees who can only perform one specific task and don’t want

to learn anything else are becoming less valuable. There is no place for static jobs anymore.

We can conclude that employability is an important issue for companies nowadays, as

employable employees can adapt to all the changes the company is experiencing.

The interview at the municipality Steenwijkerland ends with an applicable quote: Stel dat we

investeren in onze werknemers en ze vertrekken? Maar stel dat ze het niet doen, en ze blijven.

Translated as: "What if we invest in our people and then they go away? What if we do not

invest and they stay?” I found this quote so relevant to my research that I decided to use it as a

subtitle.