Compensation and Employee Productivity in Selected Manufacturing Companies in Rivers State, Nigeria

Full Article - PDF

Published: 2023-09-18

Page: 287-296

Uche Chima Richard *

University of Port Harcourt, Rivers State, Nigeria.

Ijeoma Emele Kalu

University of Port Harcourt, Rivers State, Nigeria.

Justice Gabriel

University of Port Harcourt, Rivers State, Nigeria.

*Author to whom correspondence should be addressed.


Motivation is pivotal in employees delivering efficiently. For organizations to leap to their goals, employees must be motivated. This ignited this study, as it unearths how compensation affect employees’ productivity. The focal area is manufacturing firms operating out of Rivers State. Compensation was studied using financial, fringe and non-financial benefits and correlated against employees’ productivity indicators (task accomplishment and job quality). We randomly selected 319 employees from a pool of employees engaged at the manufacturing companies. To collect data to test our hypotheses, we administered questionnaire to the 319 employees and the perception analysed using descriptive and inferential approaches. Our correlation results were welcoming and palatable as correlating financial, fringe and non-financial benefits against task accomplishment yielded strong positive correlation. Also, job quality was positively correlated with financial, fringe and non-financial benefits. Our result testifies to compensation being stimulator of employees’ productivity, giving empirical support to theoretical postulations. The recommendations put forward are that a bonus payment system be adopted and should be predicated on performance. To foster career growth, training programmes should be designed and employees trained on courses pertaining to their jobs.

Keywords: Compensation, employees’ productivity, financial benefit, fringe benefit, non-financial benefit

How to Cite

Richard , U. C., Kalu , I. E., & Gabriel , J. (2023). Compensation and Employee Productivity in Selected Manufacturing Companies in Rivers State, Nigeria. Asian Journal of Economics, Finance and Management, 5(1), 287–296. Retrieved from


Download data is not yet available.


Saman A. Effect of compensation on employee satisfaction and employee performance. International Journal of Economics, Business and Accounting Research (IJEBAR). 2020;4(01).

Jean KN, Ngui TK, Robert A. Effect of compensation strategies on employee performance: A Case Study of Mombasa Cement Limited. International Journal of Innovative Social Sciences & Humanities Research. 2017;5(3);25-42.

Uzoamaka EV, Innocent IE. Effects of Compensation plan on employee performance in the telecommunication industry, study of MTN Nigeria. International Journal of Economics and Business Management. 2018;4(6):21-34.

Candradewi I, Dewi IGAM. Effect of compensation on employee performance towards motivation as mediation variable. International research journal of management, IT and Social Sciences. 2019;6(5):134-143.

Adams JS. Inequity in social exchange. In Advances in experimental social psychology. Academic Press. Jan 1 1965; 2:267-299

Akhigbe OJ, Ifeyinwa EE. Compensation and employee loyalty among health workers in Nigeria. Archives of Business Research. 2017;5(11).

Heinz W, Mark VC, Koontz H. Management. New Delhi, india. Tata McGraw Hill Education private limited; 2011.

Adnan M, Zarrar S, Zaffar K. Employee empowerment and compensation as a consequence on employee job performance with the moderating role of employee accountability. iRASD Journal of Management. 2021;3(3):218-232.

Noor Z, Nayaz N, Solanki V, Manoj A, Sharma A. Impact of rewards system on employee motivation: a study of a manufacturing firm in Oman. International Journal of Business and Management Future. 2020;4(2):6-16.

Nnubia AL. Monetary incentives and employee performance of manufacturing firms in Anambra State. International Journal of Innovative Finance and Economics Research. 2020;8(1);10-22.

Orji MG, Ezinmuo ME. Effect of financial incentives on employee work habit and performance in Nigerian public enterprises. International Journal of Research in Finance and Management. 2019;2(2):13-22.

Chinyio E, Suresh S, Salisu JB. The impacts of monetary rewards on public sector employees in construction: A case of Jigawa state in Nigeria. Journal of Engineering, Design and Technology. 2018;16(1):125-142.

John L, Teru P. Effect of compensation/pay on staff retention in selected commercial banks in Adamawa State, Nigeria. International Journal of Scientific Research and Management (IJSRM). 2017;5(9):7033-7039.

Zirra CTO, Mambula CJI, Anyatonwu P. Impact of fringe benefits on employee performance: A study of Nasco Group, Jos Plateau State. International Journal of Education and Social Science. 2019;6(1): 25-33.