Compensation, Creativity, Job Engagement, and Job Performance in the Construction Industry: The Moderating Role of Labor Skill Status
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Objective: This study aimed to examine the effect of compensation on job performance among construction employees and to test the mediating roles of job creativity and job engagement and the moderating role of labor skill status.
Methods and Materials: An explanatory cross-sectional quantitative design was used. The population included 2,461 certified employees from GAPENSI construction companies in East Java, Indonesia. A total of 223 valid responses were obtained through purposive sampling. Data were collected using a structured questionnaire measuring compensation, job creativity, job engagement, job performance, and labor skill status. The measurement and structural models were analyzed using partial least squares structural equation modeling.
Findings: The model explained 18.1% of the variance in job creativity, 3.9% in job engagement, and 14.0% in job performance. Compensation had a significant positive effect on job creativity, β = 0.435, p < .001, and job performance, β = 0.197, p = .011, but not on job engagement, β = 0.001, p = .987. Job engagement significantly predicted job performance, β = 0.257, p = .001, whereas job creativity did not, β = −0.066, p = .304. Labor skill status significantly moderated the compensation–performance relationship, β = 0.137, p = .038, but did not moderate the effects of compensation on job creativity or job engagement. Neither job creativity nor job engagement mediated the compensation–performance relationship.
Conclusion: Compensation directly improved job performance, particularly when supported by higher labor skill status.
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