The Impact of Competence and Promotion on Employees' Economic Performance through Job Satisfaction at Bank Indonesia

Abstract

This study examines the effect of competence and promotion on employee performance, with job satisfaction serving as a mediating variable, within the operational currency management unit of Bank Indonesia Jakarta. In the context of public sector organizations facing increasing demands for efficiency, accountability, and operational reliability, understanding the mechanisms through which human resource practices influence performance is critically important. This study adopts a quantitative approach using a census method, involving 123 operational employees as respondents. Data were collected through structured questionnaires and analyzed using Partial Least Squares–Structural Equation Modeling (PLS-SEM). The results reveal that competence and promotion both have positive and significant effects on employee performance. In addition, competence and promotion significantly influence job satisfaction, which in turn has a positive and significant effect on performance. More importantly, job satisfaction is proven to mediate the relationships between competence and performance, as well as between promotion and performance. These findings indicate that competence development and fair promotion practices enhance employee performance not only directly but also indirectly by fostering higher levels of job satisfaction. This study contributes to the human resource management literature by empirically validating the mediating role of job satisfaction in the competence–performance and promotion–performance relationships, particularly within a public sector operational setting. Practically, the findings suggest that public organizations should adopt an integrated human resource strategy that simultaneously emphasizes competency development, transparent promotion systems, and the enhancement of job satisfaction to achieve sustainable performance improvements.