To what extent do salary and working
conditions affect the employee retention
rate?
Course: International business administration
Name: Julian Boom
Student number: 2746897
Date: 18-10-2021
Tutor: Paul Stroet
, Introduction
What is important for employees to keep working at their job? That is a question that many
employers have asked themselves, while it is very important for employers that their
employees are motivated and focused so that they can be fully productive for the benefit of
the organization. It is also desirable for employers that their employees want to stay at their
job because it is more efficient to retain a good employee rather than having to recruit and
train a new employee (SHRM,2017). Employees usually stay at the same job as long as their
satisfied, so job satisfaction is extremely important. But how can employers improve job
satisfaction?
Many studies have researched the effects of working conditions and salary on employee
retention. To start with a study by Iqbal, S., Guohao, L., & Akhtar, S. (2017) which
researched how culture, benefits, and salary affected job satisfaction, and how this related to
the employee retention rate. In the study, the researchers used the random sampling
technique to collect their data. Another study conducted by Ramlall, S.(2004) looked at
employee motivation theories, and offered explanations on how these employee motivation
theories affect employee retention and behavior in organizations. A study by Mwakidimi
Msengeti, D., & Obwogi, J. (2015) researched the effects of pay and work environment on
retention in the hotel industry in Mombasa county.
This paper aims to investigate the impact of salary and working conditions on the employee
retention rate in organizations.
The following research question guided this literature review: To what extent do salary and
working conditions affect the employee retention rate? To examine the relationship between
the three theoretical constructs , the theory of Maslow’s Hierarchy of Needs has been applied.
This Literature review, starts with an introduction to the theory of Maslow’s Hierarchy of
Needs, followed by an explanation of the theoretical constructs. Subsequently two
hypotheses, supported by several studies, will be reviewed. Finally, a research model with the
relations between the theoretical constructs will be presented.
The effect of salary and working conditions on employee retention | Julian Boom | 2021 2
conditions affect the employee retention
rate?
Course: International business administration
Name: Julian Boom
Student number: 2746897
Date: 18-10-2021
Tutor: Paul Stroet
, Introduction
What is important for employees to keep working at their job? That is a question that many
employers have asked themselves, while it is very important for employers that their
employees are motivated and focused so that they can be fully productive for the benefit of
the organization. It is also desirable for employers that their employees want to stay at their
job because it is more efficient to retain a good employee rather than having to recruit and
train a new employee (SHRM,2017). Employees usually stay at the same job as long as their
satisfied, so job satisfaction is extremely important. But how can employers improve job
satisfaction?
Many studies have researched the effects of working conditions and salary on employee
retention. To start with a study by Iqbal, S., Guohao, L., & Akhtar, S. (2017) which
researched how culture, benefits, and salary affected job satisfaction, and how this related to
the employee retention rate. In the study, the researchers used the random sampling
technique to collect their data. Another study conducted by Ramlall, S.(2004) looked at
employee motivation theories, and offered explanations on how these employee motivation
theories affect employee retention and behavior in organizations. A study by Mwakidimi
Msengeti, D., & Obwogi, J. (2015) researched the effects of pay and work environment on
retention in the hotel industry in Mombasa county.
This paper aims to investigate the impact of salary and working conditions on the employee
retention rate in organizations.
The following research question guided this literature review: To what extent do salary and
working conditions affect the employee retention rate? To examine the relationship between
the three theoretical constructs , the theory of Maslow’s Hierarchy of Needs has been applied.
This Literature review, starts with an introduction to the theory of Maslow’s Hierarchy of
Needs, followed by an explanation of the theoretical constructs. Subsequently two
hypotheses, supported by several studies, will be reviewed. Finally, a research model with the
relations between the theoretical constructs will be presented.
The effect of salary and working conditions on employee retention | Julian Boom | 2021 2
