DETERMINANTS OF EMPLOYEE PRODUCTIVITY IN SELECTED SMALL AND MEDIUM MANUFACTURING INDUSTRIES IN KAFA ZONE

Abstract

MENGISTU MENGESHA MISHOThe objective of this study was to assess the factors that determine employee productivity in SMEs manufacturing industries in Kafa zone. In the study, explanatory research design and quantitative approach was adopted in order to investigate the problem. The target population were employees of the SMEs industries totally 356. Purposive non probability sampling technique employed to select three woredas and three SMEs sectors.Simple random sampling technique was applied to select 188 employees’ respondents from each sample SMEs industry. The study used primary source of data and which was collected using five scaled structuredquestionnaires. After data accuracy checked and coded, it was analyzed by applyingStatistical Package for Social Sciences (SPSS) to obtain both descriptive and inferential statistics. The study revealed that the level of productivity of employee in SMEs manufacturing industries were heavily rely on personal characteristics .Specifically experience of employee, age of employee, motivation of employee ,education level ,ability, satisfaction ,training level and engagement of employee to his/her work enhance their productivity level. In relation to organizational factor the study revealed that managerial practice in SMEs manufacturing industry had been highly affecting their employee productivity level to below. Next to managerial practice motivation providing practice, training and capacity building practice, and performance appraisal practice affecting their productivity level to be low. In relation to environmental factor the study revealed that the employee working environment, training and career development, work-life balance, and pay and reward practice were not favorable to improve employee productivity. Based on the findings it is recommended that in order to improve employee productivity, SMEs industries themselves should strive to develop positive personal characteristics improve their management practice and improve working environment. Also Concerning zonal and woreda SMEs manufacturing sectors do prominent roles and give close support, re-evaluate the business service strategy for SMEs industries to improve employee productively