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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS
motivation which is directly associated with their achievements. Recently, the appraisal
of employees‘ attitude such as job satisfaction has become a common activity in
organizations in which top management is concerned with the physical and psychological
well being of people (Spector, 1997).
Beadles et al (2000) found that job retention was positively correlated with organizational
performance. Unavoidable turnover is typically viewed as unfavorable to an organization
(Campion, 1991). Most research supports the notion that turnover decreases
organizational performance. Mobley (1982) suggested that turnover might disrupt job
performance when an employee who intends to leave becomes less efficient, when an
experienced employee leaves, or when time is lost in an attempt to secure a replacement.
Empirical research has shown that voluntary turnover is related to lower organizational
performance (Shaw, Gupta, & Delery, 2002). Other research suggests that turnover can
actually improve performance. One potential benefit of turnover is the elimination of
poor performing employees (Price, 1989). Additionally, Staw et al (1986) proposed that
turnover can increase performance if most of the turnover is by employees with very long
or very short tenure.
Turnover is a persistent problem in organizations (Abbasi & Hollman, 2000; Price,
1989). It is prevalent in every type and size of organization and at every organizational
level (Abbasi & Hollman, 2000; Beadles, Lowery, Petty, & Ezell, 2000). Abbasi and
Hollman (2000) go so far as to state that turnover is ‗‗one of the most significant causes
of declining productivity and sagging morale in both the public and private sectors‘‘ (p.
333). Turnover is also very costly for organizations. It is estimated that American
industries incur a cost of $11 billion annually as a result of voluntary and involuntary
turnover. This cost is due to termination, advertising, recruitment, selection, and hiring
(Abbasi & Hollman, 2000; Mobley, 1982). Turnover also produces intangible costs, such
as declining morale (Abbasi & Hollman, 2000), and the disruption of social and
communication patterns (Mobley, 1982). Because of this, the study of turnover is a wellresearched
area and is of major interest in organizational behavior (Beadles et al., 2000).
Research by Allen and Griffeth (2001), Allen et al (2003), and Chiu and Francesco
(2003) shows that job satisfaction is a strong predictor of turnover intentions.
Elangovan‘s (2001) extensive research shows that job satisfaction predicts both
commitment and turnover intentions, and commitment predicts only turnover intentions.
It is instructive to note that, according to Jaros et al (1993) and Wasti (2003),
organizational commitment depicts the strongest negative relationship with turnover
intentions.
According to Hellman (1997), increasing dissatisfaction in employees results in a higher
chance of considering other employment opportunities Seccombe and Smith (1997)
found that the factors given by employees as reasons for leaving were centered on issues
known to affect job satisfaction such as ineffective supervisory relationships and poor
COPY RIGHT © 2011 Institute of Interdisciplinary Business Research 170
JANUARY 2011
VOL 2, NO 9