Leadership Styles And Employee Satisfaction: An Empirical Study Of Private Higher Education Institutions In Ethiopia

Abstract

Background: Leadership behavior determines the academic culture, retention and performance of  staff in higher education institutions. Despite  increasing number of studies on organisational behaviour in Sub-Saharan Africa, there is a lack of empirical evidence that associates particular leadership styles with employee satisfaction in  private higher education sector in Ethiopia.

Purpose: This study explores  associations between three most prevalent leadership styles, namely transformational, transactional and laissez-faire and employee satisfaction among academic and non-academic staff members in  private higher education sector in Ethiopia.

Methodology: This study employed a quantitative cross-sectional survey approach. Data collected from 302 employees in eight purposively sampled private higher education institutions in Addis Ababa using two standardised instruments: Multifactor Leadership Questionnaire Short Form (MLQ-5X) and the Minnesota Satisfaction Questionnaire Short Form (MSQ-SF). Descriptive statistics, Pearson correlation analysis and multiple linear regression analysis conducted using IBM SPSS Statistics version 27.

Results: Transformational leadership strongest positive predictor of employee satisfaction (β = 0.54, p < 0.001) followed by transactional leadership (β = 0.28, p < 0.001). Laissez-faire leadership  significant negative predictor (β = −0.31, p < 0.001). Full model explained 58.3% of variance in employee satisfaction (R² = 0.583, Adjusted R² = 0.575; F(6, 295) = 68.47, p < 0.001).

Conclusion: Transformational leadership is most influential predictor of employee satisfaction in Ethiopian PHEIs. Institutional administrators and policymakers must focus on leadership development programs emphasizing inspirational motivation, intellectual stimulation and individualized consideration to enhance staff retention and institutional outcomes.