Structural Equation Model for Determinants of Labor Quits in Manufacturing Organizations

Abstract

Aim of the Study: This study invokes the need to prioritize the issues of non-executive workers, whose wellbeing is overlooked by organizations and researchers. The study aimed to measure the factors influencing the turnover intention of employees, and examine how turnover intention influences employee turnover at manufacturing organizations.

Methodology: This study is cross-sectional, and a closed-ended questionnaire was used for collecting data that comprised 36 items about nine variables/constructs. The sample of the study consists of 342 workers from 12 mills—from four different industries—situated at Site Area Kotri, Pakistan.

Key Findings: There were eight hypotheses developed for the study, except for H7, all seven were supported. A comprehensive model has been developed that contains seven determinants of employee turnover intention and a relationship between turnover intention and employee turnover. The structural model has fulfilled the requirement of achieving accepted values of fit indexes, and all the paths have positive beta coefficients.

Conclusion: Insecure jobs were found to be the main determinant of turnover intention in manufacturing organizations, followed by alternate job opportunities and poor reward and benefits. Management of manufacturing organizations needs to devise policies for job security of employees along with improvements in the reward and benefit systems, thereby ensuring that their employees will not divert toward alternate jobs. The findings urge the management to improve the factors responsible for turnover, which will help reduce the quits.