Abstract
Drawing on the literature on innovation climate and employee attitudes, we discuss how innovations could impact job satisfaction. Using lagged predictors and relevant control variables, we investigate empirically this relationship on a large sample of French firms. Our estimation results show that employees in companies that engage in innovation activities are more likely to report increased job satisfaction. Moreover, building on previous organizational research arguing that layoffs are likely to create detrimental workplace atmosphere and conditions, we test whether the relationship between innovation and job satisfaction is moderated by downsizing decisions among the examined firms. We draw several theoretical and managerial implications.