The Effect of Compensation and Empowerment on Employee Loyalty Mediated by Job Satisfaction (Case Study at PT Permodalan Nasional Madani Regional Surabaya 1)

The purpose of this study was to determine the effect of compensation and empowerment on employee loyalty with job satisfaction as an intervening variable. The research was conducted through survey with quantitative research type. Sampling was selected randomly with 100 PNM employees as respondents. This research use Partial Least Square (PLS) to test the hypothesis. This research found that compensation and empowerment have a significant effect on employee’s job satisfaction, compensation and empowerment do not have a significant effect on employee loyalty, and job satisfaction is able to mediate a relationship between compensation and empowerment on employee loyalty significantly

The purpose of this study was to determine the effect of compensation and empowerment on employee loyalty with job satisfaction as an intervening variable. The research was conducted through survey with quantitative research type. Sampling was selected randomly with 100 PNM employees as respondents. This research use Partial Least Square (PLS) to test the hypothesis. This research found that compensation and empowerment have a significant effect on employee's job satisfaction, compensation and empowerment do not have a significant effect on employee loyalty, and job satisfaction is able to mediate a relationship between compensation and empowerment on employee loyalty significantly

INTRODUCTION
The challenges for companies to survive in the era of the global economy are quite heavy, companies must continue to innovate in various ways in order to continue competing and not become extinct. The role of human resources is also very important, Human Resource Management (HRM) should be able to work well so that the company has competent and loyal employees.
Sinambela (2016) stated that HRM is an organization of human resources that become major asset, by applying management roles and operational roles so that company goals achieved. However, in the current era, it is quite difficult for companies to maintain loyal employee, as stated by Tower Watson in the Global Workforce Study (GWS) (2014), one of the consulting companies in the labor sector stated that 66% of 1000 employee respondents in this country chose to leave their company in a period of under two years. (Sukarno 2014). Compensation, empowerment and job satisfaction are considered to have an influence on employee loyalty.
PT Permodalan Nasional Madani or commonly called PNM is a subsidiary of Bank Rakyat Indonesia which engaged in microfinance through its two flagship products, UlaMM and Mekaar. Currently PNM has served around 14.5 million customers throughout Indonesia. One of the areas of PNM is in Surabaya 1 region, business growth in PNM Regional Surabaya 1 is quite rapid. However, the number of employee resignations in recent years is still high, according to HRD team data, there were 1530 employees who resigned between 2019-2022 at PNM Regional Surabaya 1.  Halimah (2022) that stated empowerment has no effect on employee loyalty. Then Alyani (2017); Larastrini (2019); Rezanti (2021); Ramadhani (2017) stated that satisfaction has a positive and significant effect on employee loyalty. while according to Nurhasan (2017) stated that job satisfaction has no significant effect on employee loyalty.
Thus, on the basis of the explanation above, the author wishes to conduct a study on the Effect of Compensation and Empowerment on Employee Loyalty Mediated by Job Satisfaction (Case Study at PT. Permodalan Nasional Madani Regional Surabaya 1. There are several problem formulations in the research to be carried out, including: 1. Does compensation have a significant effect on job satisfaction of PNM Regional Surabaya 1 employees?, 2. Does empowerment have a significant effect on job satisfaction of PNM Regional Surabaya 1 employees?, 3. Does compensation have a significant effect on employee loyalty of PNM Regional Surabaya 1?, 4. Does empowerment have a significant effect on employee loyalty of PNM Regional Surabaya 1?, 5. Does job satisfaction have a significant effect on employee loyalty of PNM Regional Surabaya 1?, 6. Does job satisfaction mediate the significant effect of compensation on employee loyalty of PNM Regional Surabaya 1?, 7. Does job satisfaction mediate the significant effect of empowerment on PNM Regional Surabaya 1 employees ?
Empowerment is the process of giving employees permission to make decisions in completing workloads on time (Gibson et al, 2012). There are several indicators of empowerment according to Kadarisman (2013), including: 1. Involvement, 2. Trust, 3. Confidence, 4. Credibility, which is to encourage competition between employees by giving awards and career paths, so that the company's performance will remain good. 5. Communication, Job satisfaction is the result of employees' work in the company related to workers, situations at work, cooperation between employees and other employees and with leaders (Moh. Asad, 2004). Below are indicators of job satisfaction according to Hasibuan (2013), including: 1. Pleased with his work, 2. Love for his work, 3. Work morale, 4. Discipline, 5. Work achievement.
Loyalty is an individual or employee awareness in building a company and needing each other (Pandrey, 2012). There are several indicators of loyalty according to Siswanto (2010) in Kurniawan (2019) including: 1. Obeying the rules, 2.Responsibility for the company, 3.Willingness to cooperate, 4. Feeling of belonging to the company, 5. Relationships between employees are good, 6. Pleasure with work.
From the explanation of the theoretical study and previous research, this research formulates a framework as follows: This research is quantitative research with, with the research population being employees (Account Officer) PNM Region Surabaya 1. The sample used refers to the slovin formula, which is 100 people. The independent variables in this study are compensation (X1) and empowerment (X2), the dependent variable is loyalty (Z), and the intervening variable is job satisfaction (Y). The data collection method in this study uses a questionnaire, which refers to the Likert scale. Data analysis in this study uses Structural Equation Modeling (SEM), then the analysis tool uses Partial Least Square (Smart PLS) software.

METHODOLOGY
This research uses a quantitative research method, nonprobability sampling with a purposive sample technique. A total of 100 respondents and two analysis methods used, namely outer model analysis with Convergent Validity, Discriminant Validity, Composite Reliability, Cronbach's Alpha and using inner model analysis with Hypothesis Testing.

RESEARCH RESULT
0.922 Source: SmartPLS Output All variables including compensation, empowerment, job satisfaction and loyalty already has a value> 0.7, so it can be concluded that the relationship between indicators and constructs in the model is valid.
Then another convergent validity parameter is checked, namely Average Varian Estracted (AVE). The resulting AVE value must be> 0.5 in order to be considered valid. The assessment results are attached in table 3 below:   Vol.2, No.8, 2023: 1927-1942 1935 Figure 3. Inner Loading Data Source: SmartPLS Output In data analysis using SmartPLS to assess the model starts from paying attention to the R square of each independent variable. The change in R-sqare value can be used in explaining the effect of certain independent variables on the dependent variable. The R-square value can assess the level of variation in the change of the independent variable on the dependent variable. Rsquare has three classifications, namely: R-square values of 0.19, 0.33 and 0.67 to indicate that the model is weak, medium and strong. The following are the R-square results in this study: R-square value of job satisfaction is 0.707. This value shows that the influence of the dimensions of the compensation and empowerment variables on job satisfaction is 0.707, So the job satisfaction variable is categorized as strong.
Then the R-Square value of loyalty is 0.701. This value shows that the effect of the dimensions of the compensation and empowerment variables on loyalty is 0.707. So that the loyalty variable is categorized as strong.  T-statistics have positive values, so the relationship between the independent and dependent variables is positive. P-value <0.1 indirect relationship between job satisfaction and loyalty, compensation and job satisfaction, empowerment and job satisfaction. P-value <0.1 indirect relationship between compensation and loyalty through job satisfaction and the indirect relationship between empowerment and loyalty through job satisfaction.

DISCUSSION
The results of data analysis in this study state that compensation has a significant effect on job satisfaction. Appropriate and proper compensation from the company will make employees feel good job satisfaction. Compensation has a significant influence on employee job satisfaction. So that if the higher the company compensates its employees, the higher the job satisfaction felt by employees. This statement is in line with Rizana (2020); Vizano et al. (2020); Ramadhani (2017), compensation has a positive and significant influence on employee job satisfaction.
The results of data analysis in this study state that empowerment has a significant effect on job satisfaction. So that when empowerment from within the company is high, employee's job satisfaction will also increase. Empowerment itself is the process of giving authority to employees in determining their own destiny, and recognizing the role of each employee in the organization. Employees who are often involved in company activities will feel that they are valued, and then employees can feel satisfied at work. This statement same as what Halimah (2022); Rezanti (2021); Rizana (2020) said in previous research, empowerment has a positive and significant effect on job satisfaction.
The results of the analysis in this study state that compensation has no significant effect on employee loyalty. Whether or not compensation to employees is high does not really affect employee loyalty. This happens because there may be many other factors that affect employee loyalty more, including leadership style, work environment and motivation. The results of this study are similar to previous research conducted by Vizano (2020); Utami (2020), compensation has no significant effect on employee loyalty. However, according to Kurniawan (2015); Rezanti (2021); Rizana (2020); Stephani & Wibawa (2014);Sumiatik et al. (2021) is the opposite, that compensation has a positive influence on employee loyalty.
The result of the analysis in this study is that empowerment has no effect on employee loyalty. Similar to Halimah's research (2022) which states that empowerment has no influence on employee loyalty. This means that even though the company has increased the level of empowerment in employees, its not enough to influence the loyalty. However, this is different from previous research submitted by Kurniawan (2015); Rezanti (2021) empowerment has a positive effect on employee's loyalty. It is possible that there are many other factors that are more influential on employee loyalty, such as work environment, motivation or leadership style.
The result of the analysis in this study is that job satisfaction has a significant impact on employee loyalty. An exact research result submitted by Alyani (2017); Larastrini (2019); Rezanti (2021); Ramadhani (2017) job satisfaction affects employee loyalty. So it can be interpreted that the higher the employee feels satisfy with his work, the higher the level of employees loyalty to company.
The results of data analysis in this study state that compensation has a significant effect on employee loyalty through employee job satisfaction. High compensation from the company can make employees feel satisfied loyal. Zahrah Putri Ramadhani (2017) in previous research also conveyed the same thing that job satisfaction is able to mediate the relationship between compensation and employee loyalty. It is important for companies to pay attention to this so that employees can increase their loyalty to company.
The results of data analysis in this study found that empowerment has a significant effect on loyalty through employee job satisfaction. This is also similar to previous research conducted by Anjani (2022); Halimah (2022) job satisfaction is able to mediate the positive influence between empowerment and employee loyalty.

CONCLUSION
Based on the results of data analysis that has been carried out in this study regarding the effect of compensation and empowerment on loyalty mediated by employee job satisfaction, it can be concluded as follows: 1. Compensation has a significant effect on job satisfaction, so hypothesis one (H1) is accepted. 2. Empowerment has a significant effect on job satisfaction, so hypothesis two (H2) is accepted. 3. Compensation has no significant effect on employee loyalty, therefore hypothesis three (H3) is not accepted. 4. Empowerment has no significant effect on employee loyalty, on this basis hypothesis four (H4) is not accepted. 5. Job satisfaction has a significant effect on employee loyalty, meaning hypothesis five (H5) is accepted. 6. Job satisfaction is able to mediate the significant effect of compensation on employee loyalty, so hypothesis six (H6) is accepted.