Factors Affecting Employee Retention: A Case Study of Two International Organizations in Addis Ababa

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Addis Ababa University


Employee Retention and turnover has become the top workforce management challenge in today’s dynamic business environment. Global trends indicate that talent shortage has become a prominent issue globally and caused a serious competition in the labor market. Therefore, it is crucially important for companies to retain their top performers even though it is a challenging issue encountered by many organizations. Thus, the purpose of this study is to identify and analyze the major factors that affect employee retention in international organization in Addis Ababa – A case study of two organizations. The objective of the study was to explore the relationship between employee retention and Six commonly identified factors; compensation, work-life-balance, organizational culture, Health and wellbeing programs, personal development and superior-subordinate relationship. A quantitative approach was used and data were collected through questionnaires and analyzed using STATA after coding and cleaning. Data were analyzed using frequency, correlation, and regression analysis. Multiple regression model was applied to determine the cause and effect relationship between the dependent and independent variables. The findings revealed that Demographic variables are important in explaining retention rate. Marital status and age are statically significant determinants that affect retention rate the most important variables that contributes to employee retention are compensation structure, organizational culture and personal development programs are identified as the major in order of importance



Employee Retention, workforce management, Business environment