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DETERMINANTS OF SATISFACTION LEVEL OF KOREAN EMPLOYERS FROM
FOREIGN GRADUATES
Akbarova Sevara
Correspondent author.
research student, Soongsil University, Department of Lifelong Education
Kisung Lee
Author(s).
Professor, Soongsil University, Department of Lifelong Education
https://doi.org/10.5281/zenodo.8254210
Abstract.
Today there are a lot of factors that can impact on having successful career in
Korea for foreign graduates, however not all of them can have statistical significance. Conducted
research aims to determine the significant variables of satisfaction level of Korean employers from
foreign graduates. Surveys, interviews as well as questionnaires have been conducted among
Korean employers on satisfaction level, in order to develop conclusion and create guides for
stakeholders. The results show that age and Korean language speaking skills, internship period
have statistical significance in the first three models, however age and Korean language skills
have positive relationship with employer satisfaction which means over years they may learn more
about culture and head of the company and increase employers’ satisfaction. The factors can be
strengthened, that contribute to employee satisfaction and mitigate the factors that contribute to
employee dissatisfaction, whether it's the work environment or salary, the relationship between
colleagues or the relationship with the supervisor, and how empowering employees and delegating
necessary authority enables them to complete the job perfectly
Key words:
job satisfaction, foreign graduates, employee performance, company
employers, strengthen the relationship.
ДЕТЕРМИНАНТЫ УРОВНЯ УДОВЛЕТВОРЕННОСТИ КОРЕЙСКИХ
РАБОТОДАТЕЛЕЙ ИНОСТРАННЫМИ ВЫПУСКНИКАМИ
Аннотация.
Сегодня есть много факторов, которые могут повлиять на успешную
карьеру в Корее для иностранных выпускников, однако не все из них могут иметь
статистическую значимость. Проведенное исследование направлено на определение
значимых
переменных
уровня
удовлетворенности
корейских
работодателей
иностранными выпускниками. Опросы, интервью, а также анкетирование были
проведены среди корейских работодателей по уровню удовлетворенности с целью
подготовки выводов и создания руководств для заинтересованных сторон. Результаты
показывают, что возраст и знание корейского языка, период стажировки имеют
статистическую значимость в первых трех моделях, однако возраст и знание корейского
языка имеют положительную связь с удовлетворенностью работодателя, что означает,
что с годами они могут больше узнать о культуре и руководителе компании и повысить
удовлетворенность работодателей. Можно усилить факторы, способствующие
удовлетворенности
сотрудников,
и
смягчить
факторы,
способствующие
неудовлетворенности сотрудников, будь то рабочая среда или заработная плата,
отношения между коллегами или отношения с руководителем, а также то, как
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расширение возможностей сотрудников и делегирование необходимых полномочий
позволяет им чтобы выполнить работу идеально.
Ключевые слова:
удовлетворенность работой, иностранные выпускники,
эффективность работы сотрудников, компании-работодатели, укрепление отношений.
I.
Introduction
Foreign workforce policy in Korea.
From the late 1980s onwards, as industrialization
and income levels increased, a shortage of low-skilled workers developed. Since the early 1990s,
an influx of foreign workers has occurred, primarily as a result of the industrial trainee system.
However, poor system management resulted in issues such as corrupt brokers and workers fleeing
their jobs. Later, as a result of improvements such as the 2003 introduction of a foreign
employment permit system, regulations governing the employment of foreign workers were
loosened and employment protections for foreign workers were strengthened. As a result, the
number of these workers rapidly increased.
Foreigners with long-term visas who are eligible to work in Korea can be classified into
two broad categories under the current employment permit system: non-professionals and
professionals. Non-professional workers are typically granted visas for non-professional
employment (E-9), working visit (H-2), or compatriot (F-4). After arriving in Korea, foreign
workers with working visit and compatriot visas can search for jobs independently, and they can
work in a broader range of industries than those with non-professional employment visas.
Professional workers are few in number, and language instructors make up the lion's share of them.
Foreign worker quotas are currently in place to ensure their orderly entry and management. In the
case of the general employment permit system (E-9), each year, industry is assigned a quota of
approximately 50,000 new general foreign workers. In the case of foreign workers with working
visit (H-2) visas, the total number was 303,000, with a cap on the total.
However, due to the relatively strict requirements for obtaining these visas, approximately
270,000 compatriots were reported to have such visas as of the end of 2016. Manufacturing (45%)
employs the largest share of the total foreign workforce, followed by wholesale and retail,
restaurants and hotels (20%), business, personal, and public services and others (19%), and
construction (19%).12 (9 percent). Male foreign workers are concentrated in manufacturing (55%),
while female foreign workers are concentrated in wholesale and retail, as well as restaurants and
hotels (40 percent). When foreign workers are considered as a percentage of total employment,
they make up a much larger proportion of the manufacturing sector, as well as the business,
personal, and public services sectors, which include workers dispatched by temporary work
agencies.
Graduate employment studies defined generic competencies as the skills, abilities, and
characteristics that employees need to perform their jobs effectively. Employers prefer candidates
who possess generic competencies such as interpersonal and leadership abilities (Mason, 1992).
Raymond (1993) conducted a survey of students and employers to ascertain their perceptions of
the most critical entry-level employee skills. Employers ranked oral skills, dependability,
interpersonal skills, written skills, and self-starter/motivation as the top five essential skills and
abilities for success (in order of relative importance). Interestingly, students ranked oral
communication skills, interpersonal communication skills, dependability, motivation, and written
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communication skills as the most important. Levenburg (1996)interviewed business school faculty
and practitioners to ascertain the general management skills that business school graduates should
possess. Oral and written communication abilities, presentation abilities, multimedia presentation
abilities, teamwork, initiative, honesty and integrity, dependability, technical report writing,
research/library skills, global awareness, decision-making abilities, computer skills, leadership,
problem analysis and project management abilities, and multicultural appreciation were all
evaluated.
Thornburg (1997) identified the following success skills: oral communication, written
communication, computer literacy, problem solving, interpersonal relations, leadership, and
delegation. Tanyel (1999) noted that the most important characteristics that newly recruited
business school graduates should possess (in order of importance) are responsibility and
accountability, ethical values, interpersonal skills, oral communication, time management and
punctuality, and the ability to work in teams. Similarly, among university faculty respondents, the
most important attributes are responsibility and accountability, oral communication, interpersonal
skills, written communication, creativity and critical thinking, time management and punctuality,
and decision-making and analytical ability.
According to the literature review on the satisfaction level, (Yoon, et al., 2020) use the
variables dividing them into three groups: personal information (gender, age, higher education
type, GPA, school location), satisfaction with the quality of higher education, participation in
career development goals (job training program, internship, etc). However this research is about
the satisfaction level of graduates from the job. It can be used in the current research as well. Those
graduates who have internship are more satisfied than those who just having short term programs.
Jisun & Lee (2016) determined that university prestige also impacts on satisfaction level.
Foreign workers are frequently preferred over Korean workers if their job skills or work
capacities are comparable, owing to the lower reservation wages paid to foreign workers. This is
why, with the exception of highly skilled foreign workers with professional expertise, the majority
of countries protect their citizens' labor markets by emphasizing the role of foreign workforce
inflow as a complement to the domestic labor market. In other words, countries seek to mitigate
the negative consequences of foreign workers entering their labor markets by placing them
primarily in sectors avoided by domestic workers(Lee & Park, 2008).
1.1 Purpose of the study:
To conduct literature review on determinants of Korean employers’ satisfaction from
foreign graduates;
To determine whether Korean companies need foreign graduates and what requirements
employers have;
To analyze the determinants of satisfaction level of Korean employers from foreign
graduates;
To develop conclusions and recommendation according to the research results
1.2. Research questions
What are the factors that impact on the satisfaction level of Korean employers from
foreign graduates?
How can foreign graduates increase the satisfaction level of Korean employers from their
performance?
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II.
Review of Literature
Preferred Attributes by Employers.
Employing new employees is a critical task for any
business. As a result, employers prefer applicants who can work independently quickly in the
absence of an in-house training program (Kelley &Gaedeke, 1990; Webster & Taylor, 1995). This
is understandable, as accepted applicants are expected to take on the job with little supervision.
This is not always the case, however. For instance, a study conducted in four European countries
discovered that employers were skeptical of graduates' abilities in key knowledge areas and
generic competencies (Azevedo, et al., 2012). Numerous countries have developed a
comprehensive account of how skills are used and how organizational practices contribute to the
development of these skills or help eliminate skill imbalances and low-skills traps (OECD, 2012a).
Indeed, the Organization for Economic Co-operation and Development (OECD) places a premium
on the three pillars of skills strategy, namely developing relevant skills, activating the skills supply,
and putting skills to effective use (OECD, 2012a), in order to ensure that graduates are employable
and prepared for work. Employers desire employees who possess the necessary skills or
characteristics for the job for which they have been hired. Though companies have varying job
requirements, the debate over employability and what employers want continues (Bills, Di Stasio,
&Grxhani, 2017; Cumming, 2010; Cunningham &Villaseor, 2016; Frankham, 2017;
McQuiad&Lindasy, 2005; Tymon, 2013).
Employability, as defined by the Confederation of British Industry (1999, as cited in
Bridgstock, 2009), is "the individual's possession of the qualities and competencies necessary to
meet the changing needs of employers and customers" (p. 32-33). Numerous attempts have been
made to provide a more comprehensive understanding of it. For example, Finch, Hamilton,
Baldwin, and Zehner (2013) discovered two levels of understanding employability when
conducting a review of the literature. These included both specific employability skills (e.g.,
listening abilities, writing abilities, and academic performance) and higher-level categories. They
identified five factors under higher-order categories: soft skills; problem-solving abilities; job-
specific functional abilities; pre-graduate experience; and academic reputation. In a similar vein,
Osmani et al. (2015) reviewed 39 articles on employability published in Scopus journals and
discovered 53 graduate characteristics. The most significant ones were communication, teamwork,
problem-solving, technological abilities, creativity, interpersonal abilities, leadership abilities,
self-management, and adaptability/flexibility.
Performance.
Performance is a fundamental and critical concept for organizations in
general, serving as the common denominator for management scientists' attention; it is almost a
phenomenon inclusiveness and a central element of all distinctions and fields of administrative
knowledge, as well as the most significant dimension of various organizations, revolving around
the organization's existence or non-existence (Al- Chaoui, 2010). Organizational growth has
increased and broadened the scope of work, occupying the theme of performance as an area of
interest for thinkers and practitioners, and becoming the subject of a number of academic studies.
It is a core activity of human resource management, including human resource planning, selection,
appointment, determining salaries and wages, and other activities (Abu-Nasr, 2008). Farooqui and
Nagendra (2014) noted that an organization's performance is highly dependent on the job
performance of its employees. When an employee is inefficient, he or she has poor functional
performance, and as a result, the tact with which they speak and communicate information can be
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an indicator of his or her performance at work, as this skill will reflect positively on their work
results and strengthen the relationship with their direct manager. Employee performance
evaluation is a critical topic in the managerial process because it motivates administrative systems
to work energetically and actively, where it requires managers to monitor their subordinates' duties
and responsibilities on a continuous basis, and motivates subordinates to work effectively. It also
demonstrates the importance of this medium when examining the areas that make use of the
performance evaluation results, and most importantly, it demonstrates the importance of this
medium when examining the areas that make use of the performance evaluation results (Abu
Sheikha, 2010).
Concept of job performance.
Job performance refers to the degree to which an individual
achieves and completes tasks that are part of his or her function, and reflects how the tasks can be
accomplished or how the individual can meet his or her job requirements. Often, the distinction
between performance and effort is unambiguous, with effort referring to the energy expended and
performance based on the results achieved by an individual. For example, a student may expend
considerable effort to prepare for a test (Abu crack 0.2010).
Andreia (2012) noted that job performance is the most critical functional outcome, and he
defines job performance as the accumulated value from activities in which the employee will
participate directly and individually in achieving organizational goals, either positively or
negatively. According to Al-Taamnh (2009), job performance is the most critical professional
work axis in any functional area; if this performance is exceptional in light of the work
environment's commitment to justice and equality, it makes sense to elevate this performance to a
prominent position within the organization in which he works; and in a world of rapid change and
intense competition, organizations cannot compete unless high performance is one of their most
important characteristics. Al-Saraireh et al. (2009) defined performance as the result of two
interaction factors, namely ability and motivation. In the absence of motivation, an individual's
ability to perform work improperly, and if he has the motivation to work without ability, he cannot
perform as he should. Al-Dawy (2009) defined performance as an act that results in the work being
performed properly; this act is characterized by unmatched and continuous effort, or by acting in
a manner that results in the achievement of predetermined goals. Grandey (2013) demonstrates
that workplace rewards are more powerful when accompanied by pay-for-performance incentives
and commissions. As such, bonuses may reinforce good performance behaviors while decreasing
intrinsic motivation to perform. Intrinsic motivation to perform is derived from the satisfaction
and joy associated with engaging in the same activity.
Job Satisfaction.
The success of organizations is largely determined by the effectiveness
with which individual employees perform their functions and duties, which is influenced by their
level of job satisfaction, because it is entirely natural for individual performance to vary when an
employee is satisfied with his or her work, when an employee is dissatisfied with his or her work,
or when an employee believes that his or her employer is unconcerned about his or her level of
satisfaction.
The subject of job satisfaction piqued the interest of researchers in the fields of
management, psychology, and other sciences, resulting in the emergence of a plethora of research
and studies examining the concept of job satisfaction of the individual and determining the factors
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that contribute to satisfaction, and then achieving both his own and his work's objectives in a
complementary and interactive manner (Adel,.2010).
The physical work environment is critical for performance and employee satisfaction.
When the work environment is unfavorable, it can result in feelings of stress and pressure, which
can affect their performance at work. As a result, heterogeneous physical changes in employees
have an effect on their performance at work. As a result, changes to certain aspects of the work
environment, such as lighting, may result in an increase or decrease in employee performance.
Additionally, it was noted that exposure to noise, for example, has a detrimental effect on one's
sense of hearing, which can impair an employee's performance (Vischer, 2007).
Erkutlu (2008) discovered that employees perform better and feel better when responding
to workload when they believe they receive adequate compensation for their efforts. Additionally,
some believed that unfair and biased treatment constitutes significant pressure on the employee,
has a negative psychological and social impact on the employee, and thus contributes to prejudiced
behaviors and attitudes toward work.
Job satisfaction can be determined by an employee's behavior in the institutions where they
work, and this behavior is closely related to employee relations with employers and coworkers,
where job satisfaction is critical in industrial enterprises, as evidenced by the need to improve
employee work satisfaction (Soleimani et al., 2011).
Job satisfaction is one of the terms used to describe whether employees were satisfied and
convinced investigators of their desires and needs, as some measures indicate that job satisfaction
is a factor of motivation and a factor in achieving one's objectives, and is also considered an
important factor in developing an employee's positive work ethics (Bin Hussin, 2011).
The concept of Job Satisfaction.
The modern behavioral school contributed to the
development of the job satisfaction concept by viewing it as a response to multiple factors,
including job satisfaction, as well as the content and circumstances of those factors. They believe
that in order to understand job satisfaction, it is necessary to study job dimensions and standards,
which include employment, salary, promotion, and working conditions, supervision, and
coworkers. Numerous definitions have been published in an attempt to clarify the meaning of job
satisfaction, but there is no standard definition due to the multiplicity of studies and research that
have addressed this subject in unique ways; each of them attempts to develop a concept that is
consistent with the requirements of his or her research or study; additionally, the issue of job
satisfaction is frequently viewed as a personal and relative one, due to the fact that Thus, the most
critical definitions will be contained in order to address this concept.
Job satisfaction has multiple dimensions and is influenced by a variety of factors, some of
which are related to the work itself, while others are related to group work and the surrounding
work environment. It is a mistake to believe that just because an individual is satisfied with one
aspect of his work, he is necessarily satisfied with the rest of the job and its dimensions. Job
satisfaction is a relative rather than absolute concept, as there is no upper or lower limit, and the
sensation of satisfaction is the result of the interaction between the individual's desires and what
actually occurs in a particular position (Shawish, 2011).
Numerous studies have been conducted to determine employee satisfaction, as employee
satisfaction results in effective participation in the quality and excellence of organizational
performance, and there is a strong correlation between employee satisfaction and the effectiveness
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of their performance. (Piriyathanalai&Muenjohn, 2012) and Wahyudi et al. (2013) noted that job
satisfaction can be defined as a generalization of an employee's attitude toward the work
performed, which encompasses a variety of factors, and thus the employee's attitude toward his
work reflects both positive and negative work experiences, as well as future expectations.
According to Piriyathanalai and Muenjohn (2012, p90), job satisfaction is an employee's
overall assessment of his or her work, which is influenced by the employee's work location,
incentives and control mechanisms, and management system. Wang (2012) defines job satisfaction
as an employee's actions, responses, personal feelings, and physical and intellectual position in
relation to the work environment, as well as the general attitude toward his or her job duties.
Mansouri (2010) defines job satisfaction as 'the sum of what an employee expects from his
work and what happens to him, the result of which explains his job satisfaction'. While Abdul
Ghani (2008) defines job satisfaction as an employee's acceptance of his or her work in all
circumstances and conditions, this acceptance reflects the employee's feelings about the work they
are performing, and satisfaction results in increased production and achievement along with
normal tension (positive). Dissatisfaction results in unequal tension (negative) and a lack of
motivation for production.
According to Liham (2009), job satisfaction is determined by the employees' negative and
positive attitudes toward their work or certain aspects of their work. Employee job satisfaction
reflects an individual's emotional reaction to a particular job, and if an organization wishes to
increase production and improve performance, it should place a premium on employee job
satisfaction, as ignoring satisfaction factors would imply ignoring a sizable portion of the
organization's objectives. (2012) (Piriyathanalai&Muenjohn).
Kermani (2013) defines job satisfaction as a pleasurable and positive emotional state that
results from an employee's evaluation of his or her work and practical experience. Here, we can
strengthen the factors that contribute to employee satisfaction and mitigate the factors that
contribute to employee dissatisfaction, whether it's the work environment or salary, the
relationship between colleagues or the relationship with the supervisor, and how empowering
employees and delegating necessary authority enables them to complete the job perfectly.
III.
Method
Type of research.
The research studies the factors affecting employer satisfactions from
foreign graduates in Korea. As mentioned above Korean companies are attractive to foreigners in
terms of working conditions and salary opportunities. In the research the relationship between
dependent and independent variables will be checked. The variables will be chosen according to
the literature review. Satisfaction level of employers is a dependent variable and it is measured in
a Likert scale 1 to 5. The characteristic of variables is shown in the following table. In order to
collect data, the survey is conducted and analyzed in STATA.
Variables
Measurement
Control
variables
Age
criterion variable
Years of
schooling
After high school years
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Control of
origin
English speaking country =1
Non-English-speaking
country=0
Independent
variables
Language
skills:
Listening
skills
(Korean)
criterion variable
Writing skills
(Korean)
Speaking
skills (Korea)
University
prestige:
SKY
Universities
graduates or
not
SKY Universities graduate = 1,
Others=0
Internship
How long he/she had an
internship in Korea
Wage
The average monthly salary (Ln
form)
Punctuality
Whether employers are satisfied
from graduates in terms of
meeting deadlines (5 point Likert
scale)
Dependent
variable
Overall
satisfaction
from a
worker
Five-point Likert scale
Table 1. Variable sources
In the research different questions are used, especially those that are considered to be
control variables, such as gender, age, country of origin. As dependent variables language skills in
terms of listening, writing and speaking are used, and they are measured by the five-point Likert
scale to differentiate. In order to check the University Prestige is used, because employers tend to
pay more salaries for the graduates of prestigious universities. Having an internship in Korea is
also important factor, because graduates get to know Korean culture and traditions, ethics. It will
help them to get used to new company faster. Wage is used as an average amount for a month to
estimate if employers are satisfied from the performance of the workers for the salaries they pay.
As dependent variable overall satisfaction level of the employer is measured using five-point
Likert scale.
Data source:
Overall satisfaction of employers from the performance of employees
Data on this variable is collected through survey and it measures in general how Korean
employers are satisfied from the work performance of foreign graduates.
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Language skills.
Korean language skills are important even though English is widely
spoken in South Korea, still speaking Korean is appreciated and gives comparative advantage. The
data on this variable is divided on three sub categories such as speaking skills, listening skills,
writing skills of Korean language and measurement of it also used five-point Likert scale.
Internship period.
Internship while studying is not obligatory in Korea, however
foreigners may learn more about Korean companies’ corporate culture, employee expectations and
working ethics during internship period, therefore the period of internship is also checked it is
measured by the days of internship period.
University prestige.
The SKY abbreviation is the first letters of the names of South Korea's
most respected universities: Seoul National University, Korea University, and Yonsei University.
It is believed that absolutely all graduates of these universities get a high-paying job, and at the
same time a privileged status in society. There are several reasons why SKY universities are so
popular such as ranking, tuition fee, international environment. I would like to check if the
university prestige has a statistical significance on the satisfaction level of Korean employees. It
is considered as a dummy variable.
Wage.
Although there are certain standards in Korea regarding salaries, in some cases it is
negotiated between employers and employees. Therefore, we would like to check if this variable
is statistically significant and the sign of the relationship. It is measured ln of monthly average
salary of the employees
Punctuality.
One of the most appreciated qualities by employers is punctuality. It means
how foreign employees meet deadline set by employers.
Econometric model.
Perhaps the most frequently used statistical technique in the social
sciences is regression analysis. Regression is a technique for determining the relationship between
two or more object attributes. By defining and quantifying attitudes, you can gain a better
understanding of what is happening on the ground, forecast where something will occur, and begin
testing the reasons why events occur in the places they do.
OLS is the most widely used method for regression analysis. Additionally, it serves as a
good starting point for all spatial regression techniques. The method entails the construction of a
global model of the variable or process being studied or predicted; he then generates a regression
equation that reflects the process as it occurs.
Regression model
𝐸𝑆 = 𝛽
0
+ 𝑙𝑛𝛽
1
𝑊𝐴𝐺𝐸 + 𝛽
2
𝐴𝐺𝐸 + 𝛽
3
𝑌𝑂𝑆 + 𝛽
4
𝑈𝑁𝐼𝑃 + 𝛽
5
𝐾𝐿𝑆 + 𝛽
6
𝐾𝐿𝐿 + 𝛽
7
𝐾𝐿𝑊
+ 𝛽
8
𝑃𝑈𝑁𝐶 + 𝛽
9
𝐼𝑁𝑇 + 𝛽
10
𝐶𝑂𝑂 + 𝑢
𝑡
This regression model checks the relationship between dependent and independent
variables. ES-employer satisfaction level, WAGE – ln of wages of employees monthly, AGE –
average age of foreign graduates who work for the company, YOS – years of schooling after high
school, KLS – Korean language skills speaking, KLL – Korean language skills – listening, KLW
– Korean language skills writing, PUNC – how employers are satisfied from the ability of meeting
deadlines, INT – number of days of internship while studying in Korea before beginning to work,
COO – country of origin is English spoken country or not.
I.
Results and discussion
This chapter includes the analysis of the results of the regression and summary statistics of
the data. For the analysis more than 60 companies have been questioned out of them 34 participated
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in the survey. Data have been adjusted to STATA software to run regression analysis. Overall, 11
questions have been developed and used in the survey.
Variable
Obs
Mean
Std. Dev.
Min
Max
ES
34
3.529412
1.186676
1
5
AGE
34
35.32353
9.087856
22
51
YOS
34
5.320588
1.094
4
8
COO
34
0.558824
0.503995
0
1
KLS
34
3.617647
0.95393
2
5
KLW
34
2.882353
0.879556
1
5
KLL
34
3.235294
1.182161
1
5
UNIP
34
0.411765
0.499554
0
1
INT
34
46.20588
26.58409
0
90
PUNC
34
4.470588
0.748141
3
5
WAGE
34
3350882
564926.2
2500000
5000000
Table 2. Descriptive statistics without logarithm the wage
Source: Author’s calculations
Variable
Obs
Mean
Std. Dev.
Min
Max
ES
34
3.529412
1.186676
1
5
AGE
34
35.32353
9.087856
22
51
YOS
34
5.320588
1.094
4
8
COO
34
0.558824
0.503995
0
1
KLS
34
3.617647
0.95393
2
5
KLW
34
2.882353
0.879556
1
5
KLL
34
3.235294
1.182161
1
5
UNIP
34
0.411765
0.499554
0
1
INT
34
46.20588
26.58409
0
90
PUNC
34
4.470588
0.748141
3
5
logWage
34
15.01168
0.162165
14.7318 15.42495
Table 3. Descriptive statistics with logarithm the wage
Source: Author’s calculations
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Table 3 shows the number of observations, means and standard deviations, minimum and
maximum values of the variables. But one difference with table 2 is I used the log value for wage.
Figure 1. Graph matrix of variables
Source: Author’s calculations
Figure 2. Correlation matrix
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According to the correlation matrix, we can say that there is no problem of
multicollinearity.Multicollinearity occurs when independent variables in a regression model are
correlated. This correlation is a problem because independent variables should be independent. If
the degree of correlation between variables is high enough, it can cause problems when you fit the
model and interpret the results. From the correlation matrix there is slightly higher positive
correlation with employer satisfaction and age of the foreign graduates.
Variable
VIF
1/VIF
KLS
4.21
0.237703
KLL
2.87
0.34858
YOS
2.76
0.362271
logWage
2.58
0.386934
KLW
2.45
0.408974
PUNC
2.12
0.472239
AGE
2.09
0.477645
COO
1.41
0.709307
UNIP
1.28
0.782522
INT
1.25
0.797372
Mean VIF
2.3
Figure 3. VIF test results
Variance inflation coefficients range from one to ten. The numerical value for VIF indicates
the percentage by which the variance (i.e. the standard error squared) is inflated for each coefficient
(in decimal form). For instance, a VIF of 1.9 indicates that the variance of a particular coefficient
is 90% larger than what would be expected in the absence of multicollinearity — in the absence
of correlation with other predictors. The exact size of a VIF that must exist before causing
problems is debatable. What is known is that as your VIF increases, your regression results become
less reliable. In general, a VIF greater than 10 indicates a high degree of correlation and should
raise concern. Certain authors advocate for a more conservative level of 2.5 or greater.
Occasionally, a high VIF is of no concern. For instance, you can obtain a high VIF by
including products or powers of other variables, such as x and x2, in your regression. If you have
a high VIF for dummy variables that represent nominal variables with three or more categories,
this is typically not a problem.
(1)
(2)
(3)
(4)
(5)
(6)
VARIABLES
Model 1
Model 2
Model 3
Model 4
Model 5
Model 6
AGE
0.0933*** 0.0922***
0.0898***
0.0905***
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(0.0171)
(0.0201)
(0.0170)
(0.0185)
YOS
-0.0410
0.0876
0.0604
0.0365
0.0365
(0.166)
(0.159)
(0.162)
(0.191)
(0.191)
COO
-0.257
-0.160
-0.168
-0.147
-0.221
-0.221
(0.229)
(0.271)
(0.238)
(0.242)
(0.400)
(0.400)
KLS
0.277*
(0.140)
UNIP
-0.101
-0.0309
-0.0176
0.359
0.359
(0.227)
(0.226)
(0.229)
(0.269)
(0.269)
INT
-
0.0134***
-
0.0130***
-0.0131*** -
0.0139***
-
0.0147**
-0.0147**
(0.00398)
(0.00442)
(0.00418)
(0.00428)
(0.00707)
(0.00707)
PUNC
0.238
0.256
0.256
0.343*
0.762***
0.762***
(0.207)
(0.243)
(0.226)
(0.195)
(0.248)
(0.248)
logWage
0.991
0.526
0.463
0.829
2.954***
2.954***
(0.678)
(0.725)
(0.697)
(0.782)
(0.856)
(0.856)
KLW
0.0615
(0.139)
KLL
0.147
(0.112)
Constant
-15.69
-8.703
-7.833
-12.92
-
43.75***
-43.75***
(9.731)
(10.44)
(10.03)
(11.35)
(12.50)
(12.50)
Observations
34
34
34
34
34
34
R-squared
0.777
0.746
0.762
0.740
0.500
0.500
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Robust standard errors in
parentheses
*** p<0.01, ** p<0.05, * p<0.1
Figure 4. Regression results.
IV.
CONCLUSION
In order to check the relationship between variables, OLS method has been used and results
have been obtained. In the regression results, I have developed 6 models to determine statistically
significant variables for the employer satisfaction level. According to the results of correlation
matrix and VIF test, we ran different regression models. In the first three models’ language skills
questions have been used separately. In the last three models some variables have been excluded
to check.
The results show that age and Korean language speaking skills, internship period have
statistical significance in the first three models, however age and Korean language skills have
positive relationship with employer satisfaction which means over years they may learn more
about culture and head of the company and increase employers’ satisfaction. Internship period has
a negative relationship with employer satisfaction. It can be explained that expectation of
employers from those who had an internship is high, however if employees do not meet their
expectations, employers may get unsatisfied from employees.
Except speaking other language skill elements such as writing and listening are not
statistically significant to dependent variable. When I excluded the age variable which is highly
correlated with dependent variable, another variable also became significant. They are wage and
punctuality. They both have positive relationship with dependent variable. Korean employers that
pay high salaries to foreign graduates are satisfied from their employees. Punctuality is also
appreciated by Korean employers. But the country of origin, university prestige years of schooling
do not have statistical significance with dependent variables.
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