Employee Turnover in Egypt

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The Impact of Labor Turnover on The Performance of Egyptian Organizations in Private Sector and Factors Affecting Labor Turnover

Hossam El Farghaly & Omar Fouad

Abstract

The main purpose of this study is to analyze the factors affecting "Labor Turnover" phenomena and the impact of Labor Turnover on the performance of Egyptian organizations in private sector.

The research study is based on quantitative research methodology; the questionnaires were distributed in many organizations with many fields such as production, telecommunications, retail and banks. The measures for analysis are the factors affecting this phenomenon (company image, the pay satisfaction, nature of work, nature of peer group, peer self-comparison, internal career/growth opportunity, outside career opportunity, the degree of match between what was expected and what was achieved in the present job) and its impact on the performance of organizations.

It was found that Labor Turnover affects negatively the performance of organizations and the most important factors affecting turnover are; internal career/growth opportunity, the pay satisfaction, outside career opportunity and the degree of match between what was expected and what was achieved in the present job.

Introduction

Labor turnover is a term that is widely used by many human resource practitioners. The term “turnover” is defined by Price (1977) as: “The ratio of the employees of organization who left in a particular period of time with the average number of employees in that organization during the same period of time”. According to Currivan (1999), “Turnover is a behavior which describes the process of leaving or replacing employees in an organization”. to the comment given by Becker (1999) that the most common cause of employees leaving their jobs is inability of the employees to match their skills against the skills demanded by the job. According to Kevin et al (2004), although there is no standard framework for understanding employee’s turnover Processes as whole, a wide range of factors have been found useful in interpreting employee turnover. Turnover has considerable impact on an organization performance as it should be properly addressed and measured. In a survey conducted by Chartered Institute of Personnel and Development (CIPD) in 2005, different responses towards turnover were revealed as follows: - 52 % of the respondents felt that labor turnover had a minor negative effect on organizational performance. - 21 % stated that there was no effect.

- 17 % stated that a serious negative effect.
- And 9 % that there was a positive effect.
Past researches concluded that employee turnover has very negative effect on the operating performance of an organization with the help of theoretical and empirical analysis and this is due to interruption of daily organizational routines (Dalton and Todor 1979, Bluedorn 1982). On the other hand, many other researchers found that organization gets benefit due to fresh blood and innovative thinking and also increases the motivational level of employees that bring to a new job (Abelson and Baysinger 1984, Mowday et al. 1982). Fahad Abdali. (2011),

Most turnover research has been carried out in the United States and is predominantly quantitative theory testing using cross-sectional designs. It is dominated by studies in the psychological tradition that place turnover as a dependent variable and explore its antecedents in private sector contexts. There is much less work on turnover as an independent variable and hence its relationship to organizational performance and there is relatively little research on turnover in the Gulf region where there are big social, cultural and labour market differences in relation to the West. (STEPHEN SWAILES & SALEH AL FAHDI. (2010))

The reason that why, this research topic was selected because in our environment most of the workers are not satisfied with their jobs and most of...
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