KnE Social Sciences | International Conference on Economics, Business and Economic Education 2018 (ICE-BEES 2018) | pages: 771–787

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1. Introduction

In recent competitive business environment, human capital has become a fundamental part to be taking a good care by the employers. Organization in the modern era must compete in order to retain their employee's talent and explore possible ways that the quality and quantity of the attachment of employees with their organization can be improved. In addition, the talent of one employee cannot be inherited or be same by others new employee, thus the needs to retain the employees are crucial for employers and organizations to face the challenges in intense global competition. Employee turnover intention has become most important issue to organizations. Hence, it really needs special attention since it can affects workplace climate and lead to decreasing performance [8].

According to [30], as globalization keeps revising at the rapid speed, the phenomena of employee turnover forces companies to compete with other organizations in order to keep their best talents. In order to ensure the organization keeps sustaining in the global competitive market, companies did not realize that their missions has increased the level of stress in works thus becomes burden to the employee. The employee turnover intention is a serious problem that has been facing by the organizations around the world. Although, there are many studies have investigated on this issue, but employee turnover has not showed any positive rate [31].

The continuous high number of turnover intention is not a good sign to the organization, internal and externally. Internally, it affects organization's costs, employee's morale that stay in the organization, employee's dissatisfaction and weak performance. Externally, it will also ruin the organization images and overall organizational performance [2,34]. This study can be one of the references for the other organizations to oversee the factors contributing to the employees' turnover intention. It can be useful for employers to have strategies in retaining their employees especially the talented ones. In addition, other than reducing the turnover intention of employee talents in the organizations, organizations is also recommended to retain their top-level management. This is because top-level management or senior employees have many working experiences and have high knowledge, skills and abilities as compared to the junior employees [30].

Over the years, turnover rate has become the main challenge for industries. Based on previous research conducted at private sectors, there are many questions regarding why turnover occurs among employees in the organization [16]. Every company either big or small has the same problem in retaining their employees [27]. Frequently, employees whom employed in private sector always hop their current job to another new job or known as “job-hopping”. Job-hopping happens when the employee keeps on exchanging their workplace. One of the relevant reason is because the organization not able to meet the needs of the employee [19]. According to [41], a research that done by Global Workforce Study shows that the employee turnover rate has continuously increased. Majority of the job-hoppers preferred to leave the company within two years; 36 percent in year 2015 as compared to 29 percent in years 2012 [41].

As stated by Borneo Post Seeds, the main subject that becomes attention and essential among Malaysian companies is commonly on voluntary turnover [7]. According to Malaysian MyStarJob, it is reported that the turnover rate has gradually increased from 13.2 percent in 2014 to 14.3 percent in 2015 [25]. Further, in recent report from The Sun Daily by [42], Human Resource (HR) practices in Malaysia must change and accept the fact that the average turnover for any individual is two-and-a-half years. Therefore, more researches on this issue need to further study in order to obtain more significant findings in reducing employee turnover intention. If not it will be very costly and destructive towards organization [2,14].

Organizations over the years have sought means of improving employee resource management particular with the interest of reducing and maintaining the employee turnover especially in manufacturing industry. Employee job satisfaction, organizational commitment, work engagement, reducing job stress and other means of enhancing employee happiness have been practiced and researched by practitioners and researchers to improve overall organizational performance. However, despite the awareness of the adverse effect of employee job satisfaction on overall organizational productivity and performance, the level of turnover rate tends to remain high in manufacturing industry, especially in the Malaysian manufacturing company.

Since 2000's, employee turnover issue in manufacturing industry has a major effect on quality and costs [37]. Employee turnover affects a company's bottom line. It costs the manufacturing industries across the world thousands of dollars every year [3,17,28,37]. In addition, Malaysia manufacturing industry also has suffered from a high rate of employee turnover [9]. This can be further supported by Manufacturers Alliance for Productivity and Innovation (MAPI) Foundation reported that Malaysia's manufacturing industrial productivity fell at 1.0% annual rate in the year of 2015 after 3.5% growth in the year of 2014 [22].

Despite this critical issue, about 70 percent of employee has already acknowledged and aware that employee turnover as a significant problem in the organization. However, until today, practitioners and researchers still trying to understand the factors that can retain the intellectual property in the organization [18]. Organizations these days are in a confusion on how to address their employee talent needs and to come out with effective strategies where these strategies worth for the investment that they have invested in order to reduce the turnover intention among employees. Hence, this study is to examine the factors influence turnover intention among employee in manufacturing company in Malaysia.

2. Literature Review

Turnover intention is a serious issue in many organizations with different rate of turnover. Private sector usually has the large number of turnover rate rather than public sector. The rate of employee turnover might be difference and can change according to the density of population in one area. People easily switch the current job in the area that consist the low of unemployment rate, resulting the highest number of turnover rate. As mentioned above, widespread studies had investigated about this issue, but employee turnover has not decreased yet [31]. Intention to leave is a natural phenomenon that takes place when some inadequately planned system and dispute role of work life, lack of motivation, promotion, performance and focused in the workplace and enforcing employees to disturb structure of the organization by quitting the job [6]. Turnover intention is a process of leaving the current job or willingness of the employees to separate from the organization [8]. If employees seriously want to leave the jobs, they had thought to have intention to leave the organization. Furthermore, turnover can occur in two different ways which are voluntary and involuntary. Voluntary turnover will happen when the employees intentionally decide to leave the organization while involuntary turnover happen when the employees unwillingly leave the organization but been force by the management to resign due to the poor performance or misconduct action [5]. Besides that, when the employee feels unhappy or reluctant with the current task, the decision to quit will occur. Before leave the organization, employees will predetermine the factors that enforce them to make the decision to leave.

According to the research that has been done by [29], the employee intentionally leaves the organization because of the several factors such as communication at workplace, environment, assignment given, salary and benefit received that dissatisfied the employee. Intention to leave also may be results of some external factor such characteristics of the company, financial concern, personal conflicts or opportunity to have advance career [21]. Other than that, employees' turnover will affect for those who stay in the company. It will be costly in term of the impact company will get on employee morale from losing a talented employee. Those that remain with the company may often feel demotivated thus decreasing in productivity and job satisfaction [14]. Thus, this study become important to know the pattern of turnover intention so that necessary proactive steps and preventive action should be taken to tackle this critical issue.

Job stress and turnover intention

Nowadays, a person working lives highly stressful and job stress has been one of the important factors that affect individual performance. Regardless whether the organization is huge or small, the organization will face this unavoidable issue that is stress. Stress can occur when the nature of work that going through drastic changes over the last few decades and changing in high speed become so much complex. Job stress occurs when employee unable to fulfill the demand of the job and that lead to a condition of physical and psychological mental disorder which occurs a situation of pressure. It is also about an unpleasant emotional that individual received when the job requirement cannot be coped with his or her ability [26]. Job stress usually affect people in many sectors and commonly been widely experienced and so pervasive. Initially, it resulting in high number of absenteeism rate and lead to producing huge number of undesirable effect for both individual and organization.

Nowadays, employers take very serious in analyzing the stress management problem that can influence employee dissatisfaction and consequently lead to higher turnover intention. Organization needs to put extra concern on this problem in order to employ effective stress management practices to increase employee satisfaction level and reduce the number of intention to quit [29]. There are several factors of stress relating to the job such as an unstable job, unsecured work environment like job security, job continuity, procedural justice that lead to employees' satisfaction level, feel stress to work and resulting to decision to leave the organization [29]. The reason comes from the uncertainty about what the roles that employees need to do. This issue may come from the employees' misunderstanding what is expected from them, how to meet the expectation is not vary with employee thinking the job.

Recently, [4,20] found that turnover intention has positive relationship with job stress. Researchers also suggested that inadequate information about the roles and responsibility, unclear expectation of co-worker and top management, extensive job pressure and high of role ambiguity will leads to low employees' belongingness. Hence, the employee feels dissatisfied with their jobs, undergo stress and intention to leave the organization is high.

Work engagement and turnover intention

According to [12], powerful competitive strategy has become important part for organization's future including retaining the employees in the organization. Encouraging a stable organizational relationship can create employee efficiency and effectiveness of work environment. With this kind of relationship, employee will easily adapt with their customers, suppliers, peers and they can work more stable, so that this able to make them to stay longer. Yet, questions regarding its antecedents continue to command research attention. Work engagement can be defined as a positive corresponding relationship between individual's energy and psychological attachment towards the performance of job task related [34].

If the employee is engaged with their work, they have the tendency to have good responses such as elated, fun and excited towards their work, resulting less or far away to have turnover intention. In prior study done by [20] have indicated that when employee have lacking amount of the resources, they probably allocate themselves to work with mental resilience and psychological resources such as energy and mental effort, thus decreasing their retention effort. Further, they also found that turnover intention has negative relationship with work engagement. It shows that good work engagement will be the reason for employee to stay longer in the organization. In other hand, [38] suggested that attracted highly qualified applications will help organizations to cope the shortages of skilled worker and reduces absenteeism thus lowering the turnover rate of the organization. Hence, organizational research that engaged workers is less likely to seek alternative employment.

Besides that, employee will stay with their current employer if the job engaged with them compare disengaged employees will decide to leave the organizations. For instance, if an employee feels cognitively disengaged and feels unsafe at work, these also influences the employee turnover in the organization. In a similar vein, emotional disengagement weakens belongings of the organization and decreases their intention to maintain in the organization and looking for alternative job elsewhere. The final dimension of engagement is behavioral engagement that has a negative relationship with turnover intention like cognitive and emotional engagement [11]. On contrary, when employees have shrink in term of their emotions of being energetic and enthusiastic due to overuse psychology resources, employee are unlikely will engage to their current work thus actively starting to look another alternative job opportunity to reinstate such emotions such as decision that affect their turnover intention [36].

Job satisfaction and turnover intention

According to [13], most previous theories and research finds that job satisfaction is one of key variable in expecting the relationship with turnover intention. Job satisfaction can be defined as what the employee actually gets from the organization and what the employees expected to get [13]. In addition, job satisfaction also can affect the decision for employee willing to stay or leave the organization. Job dissatisfaction will lead the employee to consider in leaving their current job and thinking of moving into another job. If the employees highly feel satisfied with their current job, they will stay longer in the organization. However, if the employees feel dissatisfied and have the job opportunity at advanced organization, they will leave the organization [43]. When employees have high job satisfaction, they will show a very best on what they do in the job or perform better in order to make the organization's mission, goal and objective of each year been achieved as the success of the organization is highly rely on the sales and volume of their product [14].

Employee turnover will exist when the employee dissatisfied with the current job due to the environment at the workplace. Challenges environment such job security excessive turnover and lack of job advancement opportunities are commonly difficult to understand towards job traits which this role also can influence the combination on job satisfaction and turnover intention. The researcher also highlighted that employee satisfaction can be affected by having an effective's implementation of selection, training and supervisory program. Manager can use this technique as indicator to increase employees' job satisfaction. Job satisfaction can affect the decision for employee willing to stay or leave the organization. [8] also found that job satisfaction have negative and significant relationship with turnover intention.

Organizational commitment and turnover intention

Organizational commitment is an important variable in the discussion of intention to quit since this variable have most belief that the higher commitment to the employees, the lesser the intention to leave among employees. This is due to a valuable bonus for the company to have employees with a high level of organizational commitment. Organizational commitment is a complementary relationship between the employer and their employee. It is also the feelings of employees' belongingness and responsibility towards the mission in the organization. According to [31], organizational commitment generally refers as an attachment or identification from the individual body. In psychological, the result can be seen through employees' behavior towards the organization such as trust, belongings' and contribution to achieved organizational goal.

Organizational commitment also reflects an individual's feelings about the organization as a whole. It can be supported by another research done by [14], the higher the organizational commitment among employees usually will not easily make the employees to leave the organization because they feel that the need to go beyond the normal job requirements. They also willing to make contribution towards the organization, perform better, have attitude of organizational citizenship behavior and always shows good behavior. According to research done by [15], employee commitment is an important role between organizational learning culture and intention to quit. The researcher also suggested that the top management must show supportive environment and learning culture to prevent the employees from leaving the organization. In addition, attitude and commitment of the employees may influence by motivational factors that lead to better performance. The result of high organizational commitment will appear if the employees satisfied enough with the organization, hence low employee intention to leave the company. Feeling of belongingness and ownership towards the organization can be shaped from strong organizational commitment. Indirectly, it will show employee loyalty to the organization and increase the productivity. In the previous study done by [17], shows the result that there is negative and significant relationship between organizational commitment and turnover intention.

Research framework

The linkages between job stress, work engagement, job satisfaction, organizational commitment and turnover intention has been confirmed by several researchers. For instance, [4,20][29] stressed that employee whom experienced stress related to job will result increase the intention to leave the organization. In addition, [11,36,38] found that employees are unlikely will engage to their current work thus actively starting to look another alternative job opportunity to reinstate such emotions such as decision that affect their turnover intention. In another study, [8,14,43] also found that if the employees highly feel satisfied with their current job, they will stay longer in the organization. However, if the employees feel dissatisfied and have the job opportunity at advanced organization, they will leave the organization. Finally, most of previous researchers by [14,17,31] found that the result of high organizational commitment will appear if the employees satisfied enough with the organization, hence low employee intention to leave the company. Based on the above discussion, the four main predictors that was consistently been researched previously, namely job stress, work engagement, job satisfaction and organizational commitment might influence employee turnover intention significantly. Thus, the following research model was constructed and four hypotheses were suggested:

Figure 1

Research framework.

fig-1.jpg
  • Job stress positively influences turnover intention.

  • Work engagement negatively influences turnover intention.

  • Job satisfaction negatively influences turnover intention.

  • Organizational negatively influences turnover intention.

3. Research Methodology

This study employed a quantitative research method because all the variables are measurable. The population was all employees from a manufacturing company in Malaysia. Sample was selected by using simple random sampling, in order to ensure each of the population has an independent and equal chance of being selected as respondent. In other words, every individual employee has the same equal chance of being selected. The respondents were required to answer a self-administered questionnaire. A total of 307 population were listed from 1 to 307 and the sample size of 175 is determined from the rule of thumb by [33]. Then, 175 numbers has been generated from the research randomizer website (https://www.randomizer.org/). Out of 175 questionnaires distributed, a total of 170 responses were collected and deemed usable at the end of data collection process.

In measuring the desired variables, this paper adapted the instruments established by previous studies. Specifically, it adapted five items from [23] to measure perceived turnover intention. It is important to note that this study regarded turnover intention as a construct that contained four elements; thus, it adapted 21 items from [10,24,35,40] to measure the four distinct elements of turnover intention. The items measuring the variables were assessed for their internal consistency reliability through Cronbach alpha (α). The results revealed that all the scales obtained an acceptable alpha's value (0.80 < α < 0.90). In order to test the hypotheses, this paper carried out multivariate statistical analysis to analyzed the data collected. Specifically, multiple regressions analysis was performed.

4. Findings

Respondents' background

The respondents of this study comprised of 170 employees from a Malaysian manufacturing company. A vast majority of them were female (n=170; 81%). The employees from Department of Production (n=32; 18.8%), Department of Maintenance (n=16; 9.4%), Department of Administration, Human Resource, Purchasing and procurement (n=12; 7.1%), Department of Warehouse (n=13; 7.6%), Department of QA (n=11; 6.5%), Department of Compounding (n=10; 5.9%), Wastewater Treatment (IETS) (n=9; 5.3%), Finance (n=9; 5.3%), Engineering (n=8; 4.7%), Former (n=7; 4.1%), Packing and stamping (n=7; 4.1%), Logistic & Packing material (n=6; 3.5%), Safety (n=3; 1.8%), Others (n=3; 1.8%).

Majority of the respondents change the job 1-2 times (n=97; 57.1%), never once change the job (n=41; 24.1%), 3-4 times (n=31; 18.2%), 5 times and above (n=1; 0.6%). In addition, half of the respondents' age were between 26-35 year old (n=85; 50%), followed by 18-25 year old (n=72; 42.4%), 36-40 year old (n=13; 7.6%). Thus, these findings of the respondents' age confirmed that most of the respondents with young age have experienced of change the job for at least once in their working life.

Descriptive, correlations and regressions analyses

Table 1 shows the means and standard deviations of the five variables studied in this paper. As for the elements of turnover intention, respondents rated job satisfaction the highest (m=2.97; SD=0.70), followed by job stress (m=2.91; SD=0.78), organizational commitment (m=2.79; SD=0.71) and work engagement (m=2.39; SD=0.72). Interestingly, the employees also perceived on turnover intention or intention to leave (m=3.07; SD=0.68).

Since continuous variables were used in this study, Pearson product-moment correlation was performed to determine the associations between pairs of variables (Table 1). The results indicated that all variables were significantly correlated between one and another (0.38 r 0.69; sig < 0.01). Since the greatest r-value was 0.69, the results further revealed that multicollinearity was not an issue here.

Table 1

Mean, standard deviation and correlations.


m SD Turnover Intention Job Stress Work Engagement Job Satisfaction Organizational Commitment
Turnover Intention 3.07 0.68 1
Job Stress 2.91 0.78 0.490** 1
Work Engagement 2.39 0.72 -0.453** -0.412** 1
Job Satisfaction 2.97 0.70 -0.666** -0.614** 0.416** 1
Organizational Commitment 2.79 0.71 -0.618** -0.638** .0384** 0.693** 1
m mean, SD standard deviation
**. Correlation is significant at the 0.01 level (2-tailed).

Multiple linear regressions analysis was carried out to investigate the four hypotheses suggested. The results were summarized in Table 2. The F-value gained was 44.175 (sig. < 0.01) indicated that the model was statistically significant. The R2 attained was 0.517 signified that the independent variables explained the variance in employee turnover intention as much as 51.7%. All the independent variables recorded a negative influence on turnover intention, except job stress recorded a positive influence on turnover intention. However, only three independent variables, namely job satisfaction (β=-0.407; sig. < 0.01), organizational commitment (β=-0.271; sig. < 0.01) and work engagement (β=-0.183; sig. < 0.05) showed a significant influence, while job stress (β=-0.008; sig. > 0.05) did not obtain a significant result. In terms of their importance in influencing turnover intention, job satisfaction was deemed to be a more important factor than organizational commitment and work engagement. As such, the statistical results proved that H2, H3 and H4 were supported, while H1 was not supported.

Table 2

Regression Analysis.


Beta t Sig.
Job Stress -0.008 -0.113 0.910
Work Engagement -0.183 -2.997 0.003
Job Satisfaction -0.407 -5.092 0.000
Organizational commitment -0.271 -3.338 0.001
R = 0.719a
R Square = 0.517
Adjusted R square = 0.505
Std. Error of the Estimate = 0.47920
a. Predictors: (Constant), Job Stress, Work Engagement, Job Satisfaction, Organizational commitment
b. Dependent Variable: Turnover Intention

5. Discussion

This study was conducted to highlight the relationship between job stress, work engagement, job satisfaction, organizational commitment and turnover intention. Therefore, this study represented four hypotheses to examine the relationship between variables. The first hypothesis of this research is to determine the relationship between the job stress and turnover intention. Based on table 2, there is no significant relationship between job stress and turnover intention. However, this finding is supported by [1], stated in their study conducted in Nigeria work setting, job stress may not always or necessarily lead to intention to quit. In addition, they argued this finding due to the high poverty and unemployment rate in Nigeria. Therefore, this study also found job stress is not the predictor to turnover intention. They also argued employees would rather remain the job in the same organization because it is not easy to find a new job and to be unemployed is definitely a last resort for everybody.

In other hand, there is significant relationship between work engagement and turnover intention as the result explained that if the work engagement increase, the turnover intention among employees will decrease. A negative and significant relationship between work engagement and turnover intention was also found in [11,36,38]. In addition, it is also found that there is a negative and significant relationship between of job satisfaction and turnover intention as this result indicates that if the employees dissatisfied, turnover intention will increase and this finding consistent with previous studies by [8,14,43]. Finally, the relationship of organizational commitment and turnover intention was also found as a negative and significant relationship. This result explained that if the organizational commitment among employees increase, the intention to leave among employees will decrease. [14,17,31] also reported the same findings.

6. Conclusion

From this research, there are several suggestions for improvement that can help to improve the future research and practitioner. Future researcher can include the other predictors that contribute to turnover intention, since independent variables of this study contribute 52 percent in explaining turnover intention, while the remaining 48 percent is explained by other predictors which is not been measured in this study. According to [39], other factors can affect turnover intention are leadership style or group dynamics. Besides that, [17] also added that factor of training and social support can be further researched in the future study.

Organizations also can find a way to stabilize the level of turnover intention among employees. It might affect the company's profile and image if the organization ignore this finding. It is not only losing the talented employees but as well cause low morale among other employees who still remain in the organization. Consequently, in long-term period the organization will not only lose the best talents but also affect the productivity and profitability. Thus, based on the findings, job satisfaction, work engagement and organizational commitment was found to be the most influential predictors for organizations to lower the turnover intention level.

By providing challenging and meaningful job, work-life balance, enjoyment and pleasant working environment and also an environment of work that shows the organizational concern and commitment to all employees at all level. By doing so, employee feel they are important and part of the company and have low or no intention to leave to job. The higher level of job satisfaction, work engagement and organizational commitment, the lower the turnover intention among employees. Organization also are advised to practice open-door policy in order to ensure employee at all level can freely communicate with the manager. Open or two-way communication should be created between employee and management. In other way, organization also should involve employee in every decision-making process. As a result, the employees will give their full of commitment and engaged with the organization if they are invited to share their opinions and ideas. Indirectly, it will stir the sense of belongingness to the job and the organization. As supported by [32], developing a better communication among the employees can create positive organizational climate such as increase level of trust, good communication, and cooperation. In addition, organization should also enhance work engagement level in order to reduce turnover intention. Like [12] study stated that manager can develop mechanisms on a regular basis for measuring the work engagement level on at least to the key employees. Thus, this measurement finding will assist organizations to distinguish the current employee work engagement level followed by corrective actions wherever and whenever needed.

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