How entrepreneurs influence their employees’ job satisfaction: The double-edged sword of proactive personality

Abstract

This paper aims to enhance our understanding of work and wellbeing in the entrepreneurial society. We integrate research on proactive personality (PP) and job design to explore how entrepreneurs’ PP impacts their employees’ job satisfaction by shaping employee job design in a multi-source multilevel study of 43 entrepreneurs/firms and 511 of their employees. In contexts of firm instability, entrepreneurs’ PP was negatively associated with employee job satisfaction due to higher employee job demands. In stable firms, PP related positively to employee job satisfaction due to higher employee job control and social support. We replicate these findings for mental health as a broader indicator of employee wellbeing. Our study extends research on entrepreneur PP by considering its effect on employees. It advances understanding of the bright and dark sides of PP for others in the organization, and contributes new insights on the origins of job design and the quality of work in entrepreneur-led firms.