Causes of employee turnover Research


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Causes of employee turnover Research

  1. 1. Assignment “Business Research Methods” Presented To: Sir. Shafaat Saif Presented By: Hassan Karamat MCE 13205 Class M.Com Semester 2nd Evening Superior University Lahore
  2. 2. FACTORS EFFECT ON EMPLOYEE TURNOVER: Abstract: Nowadays, it is becoming a major problem among most of the companies, especially in low paying jobs. There are many aspects that play a significant role in the employee turnover rate of a particular company. Such aspects can stem from both the company as well as the employees. The employers generally give more importance to the employee turnover rate, as it is a very expensive aspect of the business. These costs normally include advertising expenses, resource management expenses, loss of time and productivity, work inequality, and employee training and development expenses for new joiners. The company may quarterly calculate employee turnover rates to find out the factors causing the turnover. If the company determines the most common causes of employee turnover, it would certainly be able to take the necessary steps for recruiting and retaining well-qualified personnel. We use the positivism paradigms for this research. We use deductive approach because quantitative methods use. Then collect the data from secondary resources employees, manage and others. Analysis the data through descriptive approach. However this proposed study shows that organization culture, pay scale, evaluation by fair standard and tension is directly or indirectly related with employee turnover. However the above discussed research shows the relationship of organization culture with Turnover, pay scale and turnover, evaluation by fair standard and tension with turnover. Organizational change and turnover. But organization culture, pay scale, evaluation by fair standard and tension are not combining focused. However there are so many causes for turnover like salary, Job performance, personal growth, reward, compensation but this study focuses causes of employee turnover organization culture, pay scale, evaluation by fair standard and tension.
  3. 3. Background : Employee turnover is the process of replacing one worker with another for any reason. A turnover rate is the percentage of employees that a company must replace within a given time period. This rate is a concern to most companies because employee turnover can be a costly expense, especially for lower-paying jobs, which typically have the highest turnover rates. Employee turnover is the number of permanent employees leaving the company within the reported period versus the number of actual active permanent employees on the last day of the previous reported period. The most common reason why employees leave a certain organization is that they see better opportunity elsewhere. Man has a growing desire to own more things and better pay can give them this. Apart from that, they are compelled to look for better pay because of financial needs. Another reason could be that the employees are not happy with the organization. There are cases when employees leave the company even if they offer competitive salaries. This is because of the organization itself. The employee does not approve of the management style and they are unhappy with the culture of the organization. These factors can cause employees to say goodbye to the organization. There are also cases when the employees leave because of their fellow employees or his superiors. Clashes of personalities are common in the workplace. When an employee can no longer stand the tension in the workplace, he may opt to leave the organization. It does not matter if he finally got his dream job or receiving a generous paycheck. If he no longer has peace of mind, he will look for another job. It is man's nature to seek for growth. If he feels that there is no room for him to grow in a certain organization, he will look for a place where he can grow further. However, this is not a factor for everyone. There are those who are satisfied to do the same thing even after ten years. The condition of the organization could also be a factor. If it is unstable, the employees will surely look for a more stable organization. They would not want to stay long in an organization that could close any time. Lot of factor that causes the employee turnover like pay scale ,evaluation and satisfaction these factor effect directly on employee turnover although the other misdating factor also indirectly effect on employee turnover these are tension ,Behavior of staff.
  4. 4. Purpose Of The Study: This proposal is aimed at conducting a study to investigate the causes of employee turnover. Proposed study will use different research articles to develop a model which shows that organization culture, pay scale, evaluation by fair standard and tension has an impact on employee turnover. Through this study we improve the organizational culture and motivate the employees and provide the satisfaction to employees about their job. The purpose of study increases the employee’s interest toward its job, provide the facilities to employees and reduce the employees fair toward the job. The purpose finds out the reason of employees turnover. Objective Of The Study: The objective of the proposed study wants to shows that there is a relationship/impact between organization culture, pay scale, evaluation by fair standard and tension and is directly or indirectly related with employee turnover. The objective of this study is to know the organizational culture that effect on employee turnover. Through this study we know the pay scale and employee satisfaction that prevail in market. Through this study we know how organization gives benefit to employee and how they evaluate the employee performance. This study also identifies the employee mental level satisfaction and tension that causes employee turnover. Significance Of The Study:  As organization culture, pay scale, evaluation by fair standard and tension are not combining focused. So we have conducted a research for those who want to know their combined relationship with turnover.  This study helps to indentify the employee’s behaviors.  Through this research we get lot of knowledge about current situation of employee’s retention.  Organizations can get lot of knowledge of employee about retention and find out the main reason of leaving the organization.  Provide the satisfaction of employee of the organization.  Employee interest increase toward the job.  Motivate the employees of the company.
  5. 5.  Through this study provide the resources to employees to complete their work without any fair.  These studies help to provide the opportunities to employees.  Reduce the employees protest leaving the organizations.  Through this study organization culture can be better. Research Question: What are the factors effects on employee turnover?
  6. 6. MODEL: According to model i conclude these are the main Factor that effect on employee turnover. Organization Culture Pay Scale Evaluation by Fair Standards Employee Turnover Tension
  7. 7. Hypotheses: H1= There is relationship between Organization culture and Employee turnover. Ho= There is no relationship between Organization culture and Employee turnover. H1= There is relationship between Pay scale and Employee turnover. Ho= There is no relationship between Pay scale and Employee turnover. H1= There is relationship between Evaluation by fair standards and Employee turnover. Ho= There is no relationship between Evaluation by fair standards and Employee turnover. H1= There is relationship between Tension and Employee turnover. Ho= There is no relationship between Tension and Employee turnover. Literature Review: In past number of authors investigate the reason of employee turnover pervious study state that demography and organization culture effect employee turnover although different other factors also effect turn over this factor play misdating role in this model but why should these effect occur additional study must be needed to find out the answer of these things. In this article the author focus on the demographic side denino (1976) showed in a longitudinal that influencing of attitude and similarly in demography attributes such as race, age and education is also available. The other mediating is social integration research suggested that integration may affect set of important outcomes. There is dispute about this research because some collected data from group and some of the data is collected from individual respondent. Size of group was obtain from company rosters and range from three to six. Data on individual tenure with the company collected during the initial data collection. (F.Caldwell, 1989) Work group tenure was slightly difference from organizational tenure because of company training program lasting in most cases six months. In which individual was in training assignment and not in any of the groups included in our sample. In 1985, five year after the initial survey, corporate personal provided data on the employment status of the subjects in the original sample. Each individual was verified as either still employed or not, and the actual date of exit was provided. Twenty nine individual left the company during the previous five year.
  8. 8. Three individual left their workgroups but stay within the company and so were not counted as having turned over. (F.Caldwell, 1989) So with help of these observation I conclude that the main factor of employee turnover is the social demography and also the culture effect in different level in which age, organization environment, language and norms are different and there believes also different so conflict occur and this is the cause of employee turnover. (F.Caldwell, 1989) Since both individual –level and group –levels social integration may result from demographic and homogeneity both process must be modulated with each other in order to test hypothesis. Now we discuss the another factor first we segregate turnover in two type avoidable and unavoidable turnover .well when we see the unavoidable turn over the reasons behind turnover is so complicated so that we cannot stop these factor it included organizational commitment, job tension the current study tell that these two factors are put great impact on employee turnover job commitment is the most important element in which study tell that there are only few person that are commit their job. (Abelson, Aug 1987) Job tension is also the big factor in which people take too much tension of their job and they feel that they can’t do work on this job and when new task are given they feel too much burden so finally they leave the job. Unavoidable turnover could improve understanding and prediction of turnover. Unavoidable leavers and slayers in the current study were found to be no different from each other, whereas both groups were significantly different from avoidable leavers on levels of satisfaction, organizational commitment, job tension. (Abelson, Aug 1987) Critically examines research over the past 10-12 yrs concerning factors related to turnover and absenteeism in work situations. On a general level, overall job satisfaction was consistently and inversely related to turnover. In an effort to break down the global concept of job satisfaction, various factors in the work situation were analyzed as they related to withdrawal behavior. 4 categories of factors, each representing 1 "level" in the organization, were utilized: organization- wide factors, immediate work environment factors, job-related factors, and personal factors. Several variables in each of the 4 categories were found to be related fairly consistently to 1 or both forms of withdrawal. An attempt is made to put the diverse findings into a conceptual framework centering on the role of met expectations. Methodological considerations and future research needs are also discussed. (Porter, 1973) In this research we focus on unlawful activates which causes employee turnover such as absenteeism and leave the job before time so these are also become the part although these factor not directly affect but these factor create the reasons the causes employee turnover . (Porter, 1973)
  9. 9. IN this study we establish the fact that the degree of satisfaction of certain personal needs supplied by a person's place of employment has a significant direct relationship to his continuing to work for that company. These personal needs are for recognition, for autonomy, for a feeling of doing work that is important, and for evaluation by fair standards. In addition, knowing important people in the organization is related to continued employment. There are some indications that anxiety develops in those employees who state that their needs for autonomy and fair evaluation are not satisfied. (zander, sep-1957) In addition to the degree of need satisfaction provided by the job, we examined the degree to which the employment situation limits satisfactions which the worker can receive from his family and from his community. We found that the extent to which the job interferes with family and community satisfactions is related to turnover as strongly as the failure to receive need satisfactions on the job. But interference with off-the-job sources of satisfaction is not related to experiencing dissatisfaction on the job. (zander, sep-1957) We interpret these results to mean that there are two essentially different kinds of reasons for leaving the employing organization. Some people resign for reasons of both kinds: the job itself does not satisfy needs, and it also keeps them from receiving satisfactions from other sources. Most of the people in this study who resigned, how- ever, felt only one or the other of these two forms of dissatisfaction. (The interference with off -the-job satisfactions is probably higher among the people studied than in the population at large since shift work is prevalent in the industry in which this study was conducted. (zander, sep-1957) The another main factor that causes employee turnover is pay scale .today world there is inflation prevail in market so no person satisfy with their salary so that conflict occur an it result is employee leave the organization on the other end every organization want to get more work from employee on less cost. It is often thought that employee turnover causes can be prevented through growth and development opportunities, positive organizational relationships, the nature of the work performed, and respect for the organization and its values. While these environmental factors are important, a leveraging factor for employee turnover is monetary compensation; a point that employers often miss. When employers only draw a direct correlation between traditional motivation theories and employee turnover, they underestimate the complexities of employer/employee relationships. Salary can accentuate the positive or negative aspects of other contributing factors--it’s much easier to put up with a micromanaging boss if you are extremely well-paid. (Carroll, 2009)
  10. 10. Appraising performance and providing feedback is regarded as an essential managerial activity. While the common view suggests that performance feedback has an impact on employees’ motivation and self-esteem, many studies on how it works present convicting evidence. The final factor that effect turnover is evaluation of employee this is very sensitive situation because after evaluation most of the employee de- motivated and they don’t perform well in future or maybe they do disappointed with their evaluation and at the end they leave the organization.tis is the most important matter which face by all organization when staff work they work hard and they think that I am the best employee and expected from his boss good evaluation but when evaluation done he disappointed some time there is genuine reason of this attitude because some bosses show biasness to their relative employee so the evaluation not fair and this was hurt to those employee who work hard and they leave the organization. (Chen, January, 2013) . So after reading these article I conclude that there is lot of factor that causes the employee turnover like pay scale ,evaluation and satisfaction these factor effect directly on employee turnover although the other misdating factor also indirectly effect on employee turnover these are tension ,Behavior of staff.
  11. 11. DATA & METHODOLOGY: Research Paradigms: According to this model positivism paradigms is suitable because theory is already generated we just test the theory. In which we ask to the point question to our respondent and we make formal relationship with our respondent because we don’t need too much understanding with our respondent we just want to know basic information from respondent. We totally depend upon respondent in this research we don’t give any suggestion in this research and show biasness so our result is correct. We use formal language in our research by using assumption rhetoric so we do not need to make relation with respondent. We design this survey in term of measurable field work by using assumption inquiry so that we can make our data correct and facts and figures are in our data. In this research we use questioner with close ended question and ask optional question to or respondent can easily fill this questioner and it is easy to analysis this data. Research Approach: Deductive approach used because quantitative methods use in order to investigate the relationship between organization culture, pay scale, evaluation by fair standard and tension and employee turnover. This will enable researchers identify if there is any association between organization culture, pay scale, evaluation by fair standard and tension and employee turnover. Apart from data which will be collected specifically for this project. In which we test the theory objectively collect the data and systematically we collect the data from over respondent. Population And Sampling: Our population is whole companies divisions which have working in a large level will be used in order to compare with the low level company population. We selected the sampling from population. From this division a random sample of 20 companies will be selected. The sample from each category will reflect the proportion of the companies in the categories. We select a 20 company that is our sampling in which we collect the data from employees. We selected the 20 companies of same nature and collect the data from respondent. In which10 companies are working in high level and other are working in low level. Data Collection:
  12. 12. Data will be collected from secondary resources employees, manager, reference material, current affairs, resources, in-service training, community participation and others. We collect a data from interview. The data will be collected company report, employees who work within the company and company culture and infrastructure. Some test are conducted through this we collect the data. Data Analysis: Descriptive statistics will be used to describe the employee turnover. Exploratory multi-level statistical data analysis will be used to find out if there are any associations between the various additional organization culture, pay scale, evaluation by fair and tension and employee turnover. Descriptive statistics use to first of all we summarize the data by getting five figure summary, check the data from errors, summarize the data examining and comparing frequency distribution and check the normality of data. We analysis the data to make conclusion. . Limitation:  The population of the experimental group is small, only twenty-five employees and might not represent the majority of the employees of the company.  We collect a data from employees who work within the organization.  The limitation is use the large size of population.  The data must be reliable and accurate.  Avoid the self supported data. Ethical Consideration:  Research participants must voluntarily consent to research participation.  Research aims should contribute to the good of society.  Research must avoid unnecessary physical and mental suffering.  Experiments can be conducted only by scientifically qualified persons.  No research projects can go forward where serious injury and/or death are potential outcomes.
  13. 13. References: Abelson, m. A. (Aug 1987). Examination of avoidable and unavoidable turnover. journal of applied psychology , 382-386. Carroll, B. B. (2009). employee Turnover Causes and the Role of Compensation. Employee Turnover Causes , 56-72. Chen, B. R. (January, 2013). Subjective Performance Feedback, Employee Turnover Renegotiation-Proof Contracts. 1-10. F.Caldwell, C. A. (1989). Work group Demography,social integration & Turnover. 1-5. Porter, l. W. (1973). Organizational, work, and personal factors in employee turnover and absenteeism. Psychological bulletin , 151-176. zander, I. C. (sep-1957). Satisfactions and Employee Turnover. personnel psychology , 327-338.