The Influence of Salary on Employee Engagement with Organizations: the Case of Small and Medium Enterprises in Hanoi

Abstract

Objective: The study aimed to analyze the influence of salary on employee engagement with small and medium enterprises in Hanoi over the current period.   Method: The study used a pre-structured questionnaire to survey employees working for SMEs in Hanoi, with a sample size of 203. A linear structural model and Smart PLS software were used in analysis and testing to determine research hypotheses.   Results: Research results show that all five salary factors, including (i) basic salary, (ii) salary allowances, (iii) financial incentives, (iv) welfare, and (v) salary policy, have a positive effect on employee engagement with SMEs.   Conclusions: The structural model shows a significant relationship between salary and employee engagement with SMEs. The study provides policy recommendations to enhance employee engagement with SMEs.