This document provides a literature review on employee turnover. It defines employee turnover and discusses the types of turnover, including voluntary and involuntary turnover. It then examines the causes of employee turnover such as low compensation, inadequate salary, lack of benefits, and resignation. The effects of employee turnover on organizations are also explored, including impacts on productivity, costs, and time. While turnover is often seen negatively, some potential benefits are mentioned like reduced labor costs, replacement of poor performers, increased innovation, and greater diversity. Finally, strategies for reducing turnover like effective hiring, compensation packages, and communication are presented.

1. 1
ARBAMNICH
UNIVERSITY
College of Business and Economics Department of
Business Education
Research Proposal Conducted on the Causes and Effects of Employee
Turnover Intention ‘A Case Study of EdjaWoreda Education Office’
Prepared by: Bisrat Tesfaye
ID No : -----------------------------------
Advisor: Tezana B.
April, 2022
Arba Minch, Ethiopia

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TABLE OF CONTENTS
TABLE OF CONTENTS..................................................................................................................i
Abstract ...........................................................................................................................................iii
CHAPTER ONE ............................................................................................................................. 1
1. Introduction............................................................................................................................. 1
1.1 Background of the study.................................................................................................... 1
1.2 Statement the problem .............................................................................................................. 1
1.3 Research Question..................................................................................................................... 2
1.4 Objective of the study............................................................................................................. 3
1.4.1 General Objectives ............................................................................................................. 3
1.4.2 Specific objective ............................................................................................................... 3
1.5 Significance of the Study.......................................................................................................... 3
1.6 Scope of the study..................................................................................................................... 4
1.7 Limitations of the study ............................................................................................................ 4
1.8 Organization of paper................................................................................................................ 4
CHAPTER TWO ............................................................................................................................ 5
2. Review of Literature ................................................................................................................... 5
2.1 Definition of Employee Turnover............................................................................................. 5
2.2 Type of employee turnover....................................................................................................... 5
2.2.1 Voluntary Turnover............................................................................................................ 5
2.2.2 Voluntary Turnover............................................................................................................ 6
2.3 Causes of Employee turnover ................................................................................................... 6
2.3.1 Low Compensation ............................................................................................................ 6
2.3.2 Inadequate salary................................................................................................................ 6
2.3.3 Lack of Benefit................................................................................................................... 7
2.3.4 Resignation......................................................................................................................... 7
2.4 Effects of Employee Turnover.................................................................................................. 7
2.5 Cost Employee Turnover .......................................................................................................... 8
2.6 Benefits of Employee Turnover................................................................................................ 8
2.6.1 Reduced Labor Cost........................................................................................................... 9

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2.6.2Replacement of Poor Performance...................................................................................... 9
2.6.3 Increased Innovation.......................................................................................................... 9
2.6.4 The Opportunity for Greater Diversity............................................................................. 10
2.7 Strategic for Reducing Employee Turnover ........................................................................... 10
2.7.1 Hire Right Strategy........................................................................................................... 10
2.7.2 Design the Best Compensation Package Strategy............................................................ 11
2.7.3 Effective communication and Moral Strategy ................................................................. 11
CHAPTER THREE ...................................................................................................................... 11
3. Methodology of the Study ....................................................................................................... 11
3.1 Research Design...................................................................................................................... 11
3.2 Source of Data and Method of Data Collection...................................................................... 12
3.3 Sampling Technique and Sample Size.................................................................................... 12
3.3.1 Sampling Technique......................................................................................................... 12
3.3.2 Sample Size...................................................................................................................... 12
3.4 Method of Data Analysis ........................................................................................................ 12
CHAPTER FOUR......................................................................................................................... 13
4. Time Budget and Cost Budget.................................................................................................. 13
4.1 Time Budget........................................................................................................................ 13
4.2 Cost Budget............................................................................................................................. 14
Reference ...................................................................................................................................... 15

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Abstract
This study to observe the cause and effects of employee turnover at EdjaWoreda Education
office. The main objective of this study to identify the problem or challenge as associated with
different cause and effects of employee turnover on organization operation. In this study both
primary and secondary source of data will be use and also researcher will open end and close end
questionnaires to collect data from that sample respondents. The researcher will be use census
technique to select target population among the employees and also the researcher will be use
descriptive method such as table percentage to analyze the collected data.

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CHAPTER ONE
1. Introduction
1.1 Background of the study
Employee turnover is one of the most important fissures for organizations and one that needs
special attention it has some significant effects in organization, new employees must be hired
and trained it is also needed to consider the time required for a new employee to be effectively
good active. Staff turnover is a warning sign of low morale and it is the amount of movement in
and out of employees in organization. In general, employees either leave their jobs voluntarily by
their decision or forced to leave by the decision of the employee turnover is one of the factors
which affects the organization productivity, which is consider to be one of the challenging issues
in business now a days the impact of turnover has received considerable attention by senior
management human resource challenges confronting by several organization globally. Turnover
of employees consists of both voluntary and involuntary. Voluntary turnover is a major problem
for organizations in many countries (Syret, 1994)
Porters and steers (1973) suggested that the issue of met expectation was central to individual’s
decision to leave an organization. Each employee has his or her own set of expectation upon
entering an organization should these expectations not be met, the individual will become disseat
is field and leave ornament Mobley (1977) suggested that negative evaluation of the present job
leads to dissatisfaction, thoughts of quitting, and an evaluation of job seeking expectation utility
and cost of gutting.
There this study tries to examine the issue of causes and effects of employee’s turnover in the
cases study of Edja woreda Education office.
1.2 Statement the problem
In today`s competitive business world it is considered to be an important task to manage
employee turnover successfully is an essential to achieve the organizational overhead goals.

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Significant amount of research has been undertaken to understand and the major causes of
employee`s turnover and retention mechanisms that organizations should develop most of these
studies were carried out by developed countries and few developing countries some studies
indicate that every aspect of organization is employee because turnover of employee leads to in
incurring of costs. High turnover has become a problem for both private and governmental
organizations.
For instance, Solomon has conducted his research on Ethiopia road Authority (skilled work
force) turnovers in 2007 E.C and concluded that the turnover is affecting the organization in
terms of productivity, money and time. Another researcher, Yared conducted his study on
international rescue committee (non-governmental organization) and concluded that the causes
of turnover are a combination of factors which includes family problem, poor leadership,
dissatisfaction with job, better opportunity in external market, and dissatisfaction with work
place.
High estimate costs losses key employees, has long been recognized however, it is important for
organization to understand general turnover rate in the work force and also have a series impact
on an organizational profitability than survival (www.businessassociates.com) there are also
number of costs incurred as result of employee turnover these costs are derived from a number of
different sources.
A few of which are recruitment of replacement, administrative hiring costs. Productivity
associated with time that Co-workers must spend a way for their work to help a new worker cost
training (www.Businessassociated.com) employees of EdjdaWoreda Education office may also
look the environment that will satisfy their needs since the research on cause and effects of
employee turnover in EdjaWoreda Education office is not yet conducted.
This study will include detail issue related with employee turnover.
1.3 Research Question
Having problem in mind, the following basic research questions are developed to be answered by
the study.
1. What internal and external factors cause employee to leave the organizations?

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2. How turnover affect the moral of the employee who are skill worker in the
EdjaWoreda Education office?
3. How turnover intention affect the organizations?
1.4 Objective of the study
1.4.1 General Objectives
The main objective if this study is to investigate the cause and effect of employee’s turnover in
EdjaWoreda Education office.
1.4.2 Specific objective
1. To see the real internal and external cause that derives employee to leave the organization.
2. To understand the factor that contributes employee to leave the organization.
3. To assess the actual negative consequences that turnover result the operation of the
organization and existing employee.
1.5 Significance of the Study
This study has the following significances
 It will be giving full understanding about turnover and it’s consequence to employee,
policy maker, management and organization.
 It will provide the study with possible solution that helps the management to reduce
turnover.
 It will suggest some alternatives or possible solution for the identified problem.
 It will also use for reference purpose for other researchers conducted on that similar
topic.

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1.6 Scope of the study
The scope of this study limited on the cause and effects of employee turnover in EdjaWoreda
Education office. This study particularly focuses on the academic staff of the office will be
take for accomplishment of the study.
1.7 Limitations of the study
The study does not escape from the following limitation.
 Lack of resource like reference, finance, time and some technical procedures also
limitation of the study.
 Lack of voluntary person during data collection.
1.8 Organization of paper
This paper will be organized as follows the first chapter deals about introduction that include
background of the study, significance of the study, scope of the study, limitation of the study and
organization of the paper. The second chapter reviews of literature, the third chapter research
methodology, chapter four analysis of data and the fifth chapter contains about conclusion and
recommendation of the study.

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CHAPTER TWO
2. Review of Literature
2.1 Definition of Employee Turnover
Employee turnover is the relation of workers around the labor market between firms. Jobs and
occupation and between the states of employment and unemployment (Abassi, 2000
pp.241). Employee turnover is defined as the loss employee by the organization it represents
those employees was depart for variety of reason (William and Daris 1985, pp.612).
Turnover refers to ‘’the movement in to and out of an organization by the work force ‘’Edwin, P,
547: 1984) and (P.873. 1987)it is described as ‘’exit of and entrance of employee the
organization ‘’this movement is an index of the satiety of that force’’ An excessive more men is
undesirable and expensive when an employee leave the firm.
2.2 Type of employee turnover
Labor turnover have two types those relating to job shifting as such as and relating to total job
separation sometimes with details of voluntary and involuntary cessation of employee (Peter
Dewolff. PP.49.1965).
2.2.1 Voluntary Turnover
It is termination of job by the employee him self employee leave there job voluntary when their
needs are not being satisfied at their present place of work an alternatives job become an
available which the employee believe will satisfied more their needs (Irancevich, P.875, 1989).

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According to Pieter De’’ job satisfaction and non- economic reason (family change of
residences) are important consideration affecting voluntary decision to leave jobs ‘’(Pieter de, p
23. 1965) ‘’voluntary resignation are produced by a satisfying work environment High quality
supervision and personal opportunity for grow this (William and Dar is P. 223, 1985).
2.2.2 Voluntary Turnover
It is initiated by the employer through such action as lay off and dismissals the reason for
dismissals include incompetence or inability to get along with co-worker dishonesty or follow
instruction (Werther, 1997:235).
2.3 Causes of Employee turnover
There are different forms employee turnover which cases to leave the organization which defined
one by one as follow.
2.3.1 Low Compensation
Compensation is what employee receives exchange for their work William and Davis P. 136,
1985). Low compensation: -is the primary and only source of income for employee and their
family and also important to determines status in social system (Magginson 1981).
Compensation should be with enough to motivate and retain qualified workers and optimal to
ensure enough margin to the employer.
2.3.2 Inadequate salary
That process of wage determination is one of the most significant recruitment the retention
satisfaction and motivation of employees and survival of the organizational (French, 1987,
P.475). One of the most difficult functions of personal management is that of determining rate of
monetary compensation not only it is one of the most complex duties but it is also one of the
most significant to both than organization and the employee.
In establishing salary for a job there are many factors that need to be considered significant
factors affecting salary determination are supply and demand for employee skill. Labor

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organization the firm’s ability to pay productivity of the firm and economy cost of living and
government (win. p. 281.1984).
2.3.3 Lack of Benefit
The provision of indirect compensation to employee in the form of health insurance, life in
surface, pension planes, payment for time not worked and social welfare (Heinimann and his
friend 1998, P.434). Benefit has an effect whether continuous in theory of organization the
absence of adequate benefit and service contributes to employee dissatisfaction, increase
absenteeism and turnover.
2.3.4 Resignation
Resignation is defined as termination causes by employee them themselves (Daver, 1999) it also
defined as an instance were in a management ogres that the employee has physical opportunity to
continues employment with the organization.
2.4 Effects of Employee Turnover
The impacts of turnover has receive considerable attention by senior management, human
resource professional and industrial psychologist it has proven to be one of the most costly and
assumingly intractable human resource college confronting organization. Monetary and ridden
cost associated with employee leave you are also concerned when an employee leaves your
business it is cost for your factory (Berenson and Teal, 1998:22-67).
Productivity: - when the employee leaves the organization productivity will usually take and
down turn because other workers may have to add the former employee’s duties to their work
load, at least temporary.
Money: - in addition to costs associated from your owner productivity you may have to pay
employee over time to get them to take up the stack left by the former employee until
replacement can be found.

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Time: - not only money you may also distracted from your refollowing dutiesto convert for
former employee, you will have to spend time and money on advertising, interviewing and
hearing are placement employee and do not forget the time that you spent on training and hiring
are replacement employee one you find and heir a new employee, you will still experience
hanging productivity while the employee warms his/her new job.
2.5 Cost Employee Turnover
‘’Turnover cost include cost social security and unemployment compensation terminal
vocational underutilized facilities until the replacement is hired, employee cost such recruitment
expenses interview time, test cost computer record caste and
cornering expenses administration costs of notification and pay roll changes, an
losses of productivity until the new employee reaches the performance levels of the one who left
the job’’ (InrancrichandGlueck, P. 873, 1989). High labor turnover can be expensive, although
the actual cost are difficult to estimate.
High turnover may result in:
 Un necessarily high staffing levels and are time payment.
 Host or delayed production.
 Interruption to the flow of works.
 Increased production costs scarpered and risk of accident to in experienced works
 Long term workers be coming unsettled and learning.
 Low world and resulting low productivity.
 Damage to the organization local regulation.
2.6 Benefits of Employee Turnover
Although many people see turnover negatively, they have several benefits when turnover rates
are law few new several benefits when turnover rates are low den new employees has be hired
and opportunism for promotion are sharply curtailed. A persistently low truck over rate may

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have negative effect effect on performance if the work force become complacent and fails to
generate innovative ideas become complacent fail to generate innovative ideas. A certain level of
employee turnover is good and necessary to the organization include the following labor cost are
reduced poor performance are replaced.
Innovation is increased and opportunity greater diversity is enhanced, employee may receive
some potential benefits from turnover too. An individual may escape from a pleasant work
situation and eventual find one satisfaction (Encyclopedia of Business 2011, 2nd edition).
Some benefits of employee turnovers are explained below
2.6.1 Reduced Labor Cost
An organization can reduced its total labor costs by reducing the size of its work force. Although
turnover costs in lay off can be considerable, the salary saving resulting from the elevation of
some jobs can easily outweigh the turnover pay and other expenditures associated with the
layoff.
2.6.2Replacement of Poor Performance
An integral part of management is identifying poor performance and helping them improve their
performance it can employees does not respond to caching or feedback; it may bet to terminating
him or her to that a new employees can be brought in a separation of poor performance created
opportunity to hire employee for high performing in their place.
2.6.3 Increased Innovation
Turnover creates opportunity to hire employee for performing individual they also they also open
up entry level positions as employees are promoted from within an important source of
innovation in companies is a new people hired from the outside who can offer a fresh perspective
such individuals may be entry level college graduates armed or engineering hired from leading
research education.

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2.6.4 The Opportunity for Greater Diversity
Turnover creates opportunity to hire employees from diverse background and redistribute the
cultural and gender compensation of the work force increasing it work force diversity allows as
an organization to take advantage adverse work force (Gomez, Mejia W.R, 1995. P.182).
2.7 Strategic for Reducing Employee Turnover
Employee turnover is cost and disruptive to any organization while no business can realistically
expect to zero employee attribution, there are strategies that your company can implement to
retain the best employees and reduce the livelihood of your employee joining the preverbal
revolving door.
2.7.1 Hire Right Strategy
Much like divorce the best time to avoid turnover is before engagement use an employee survey
designed to help acutely identify skill gaps and workloads and implement your recruitment plans.
Accordingly some of the components of hiring right include.
- Behavior based testing
- Competency screening
- Background checking
-Organizational fit
- Capacity for learning motivation
- Future goals
You need to discover whether the employee has the right skills, capacity and character are they
good fit for your organization and culture?
Do they have a sufficient degree of motivating do they have a capacity to keep learning in the
role? What are this long-term career goals?

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2.7.2 Design the Best Compensation Package Strategy
Hail or compensation package individually where possible especially for line manager and
executive position and review at east annually keep up to date with market salary rates or make
sure the human resource department is up to speed not surprising there is a clear relationship
between benefits and turnover rates. Ensure that you provide standard industry benefits such as
disability insurance, feasible hours or life insurance where appropriate always be open to
negotiation with valuable employee and tie pay to performance.
2.7.3 Effective communication and Moral Strategy
As the owner of manager, you set the tone for employee morale. Don’t set up repetitive meeting
unless they are truly productive and you are open to suggestion from your employee for
maximum employee engage ensure that communication is not a one way cycle in your company
more an effect to listen to a feedback trough an employee satisfaction survey and today to act on
the feedback you receive employee engage meant can be along goals and not necessary achieved
overnight.
CHAPTER THREE
3. Methodology of the Study
3.1 Research Design
The research is descriptive study; it expected to be suitable in order to assessing employee
turnover because descriptive study concerned with arranging, summarizing and presenting
numerical data in the form of table that the reader can understand easily.

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3.2 Source of Data and Method of Data Collection
The research data will be obtained from both primary and secondary sources the primary data
will be collect by the distribution of questionnaire to academic staff of EdjaWoreda Educational
office and secondary data will be collect from different kind of document like internet, reference
books and journals.
3.3 Sampling Technique and Sample Size
3.3.1 Sampling Technique
In order to complete the propose study the researcher will be use census method because the
target population is small in order to collect data from each and every employee and the
population is more or less homogenous and it also gives equal opportunity to the staff.
3.3.2 Sample Size
Since the number of employees are 30, so the researcher will be use all of the employees as a
sample respondent for data collection purpose.
3.4 Method of Data Analysis
The qualitative data obtain from the primary and secondary source will be analyzed with the help
of descriptive tool such as tables and percentage.

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CHAPTER FOUR
4. Time Budget and Cost Budget
4.1 Time Budget
No Item activity Au Se OC No De Jan Fe Ma Ap May Jun Jul Au
1 Selection and
approval of research
title
X
2 Proposal writing x
3 Proposal writing X
4 Data collection X
5 Data proposing and
tabulation
X X x x
6 Data interpretation x x
7 Final writing x x

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8 Presentation of paper x
4.2 Cost Budget
There are different costs to be incurred to undertake the study that researcher estimates the
following minimum cost per item
No Item A, out unit ETB unit cost Total
1 Personal cost 1 500 500
2 Printing and typing the draft 100 7 700
3 Transportation cost 3 50 150
Stationary expenses
4 Paper 1and 1/2 300 450
5 Pen 5 10 50
6 Binder 1 50 50
Sub-total
7 Miss expense 150
Total cost 2,000

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Edwin B. fiippo (1984) personal management 6th edition pore fong and sondptinterspte
Enclopedia of business (2011) 2nd edition.
Gomez, meliluise R. DaridBacking Robert L. car duly (2001) managing human resource 3rd
edition New Delli prentice Hall of inding private limArizina state University.
Johna M. Ivaceri human resource management 9th edition New Delhi TatoMcgraw-hill
publishing company limited, C.T Bauer,
William B weather and keithDaris (1985) personal management and human resource 2nd edition
signa pore chongmoh offset printing PLC.