CHAPTER ONE

INTRODUCTION

1.1       Background to the Study

In the organization the Human Resources are the life blood of life. It is difficult for the organization to compete in the current era of competition without the loyal and competent Human Resource Manager loyal employees are the most productive and a source for the development of the organization and vice versa. It becomes challenge for the Human Resource Managers to retain the employees for long period and to minimize the turnover in the organization high turnover of employees in the organization increases the cost of hiring new workforce and decrease the productivity. An organization can gain the competitive advantage due to retaining of qualified, productive and loyal work force. The turnover is the most focused area by the scholars, academicians, researchers and the human resource managers. The outcome of the increased level of turnover in the organization is also in the form of indirect cost like burden on the existing workforce, loss of social capital and low morale. (Des & Shaw, 2001).

If an employee turns down an offer of employment or resigns an appointment after only a few weeks or months on the job, it turns out a painful derangement and disruption of business services for the company; in many cases, because some valuable training typically would have been invested on the individual in question. Many corporations plan to retain their employees for as long as it is economically and financially feasible for their businesses and they equally have good retirement plans and healthcare benefits for their workers. Some also offer sponsorships for postgraduate trainings locally or overseas, including college grants for staff members’ families.

For the past few decades, employee retention has been of interest to researchers and employers in various fields.  In order to remain competitive in the rapidly expanding global economy and to keep pace with technological advances requires a workforce with robust institutional knowledge; therefore, employee retention is of great importance to business and academic communities (Benko & Weisberg, 2007). Research from the past by Egan, Yang & Bartlett 2004 has shown that job satisfaction is strongly and inversely associated with employee’s intention to leave an organization. In other words, more satisfied employees are less likely to seek a new job, with a new employer.  With this, studying the factors that are associated with job satisfaction is essential. Two general categories are believed to influence employee job satisfaction: demographic characteristics and organizational culture.  Demographic characteristics include age, gender, education, income, and tenure of employment.

There have been several researches aimed at exploring the relationship between job satisfaction and turnover on employees. Only few have critically explored this relationship across several industries and occupations. The analysis will contribute to the literature by examining the relationship and the difference between job satisfaction and employee turnover. In addition, this study investigated how satisfaction with organizational culture influences job satisfaction, and its subsequent impact on employee turnover.