Perceived Alternative Job and Turnover Intention

Contents
Abstract................................................................................................................................ 2 Introduction ........................................................................................................................ 3 Literature Review ................................................................................................................ 4 Job satisfaction ................................................................................................................ 4 Perceived Alternative Employment Opportunities ......................................................... 4 Methodology and Data Analysis ......................................................................................... 6 Data Set & Sample ........................................................................................................... 6 Variables .............................................................................................................................. 6 Dependent Variable: ........................................................................................................ 6 Turnover Intention: ..................................................................................................... 6 Independent Variables: ................................................................................................... 6 Perceived alternative job.............................................................................................. 6 Job satisfaction ............................................................................................................ 7 Hypotheses Testing ......................................................................................................... 7 Model Specifications: ...................................................................................................... 7 Analysis Used in Study ........................................................................................................ 8 Descriptive Analysis ........................................................................................................ 8 Regression Analysis ......................................................................................................... 8 Data Analysis and Discussion.......................................................................................... 8 Descriptive Analysis ............................................................................................................ 9 Correlations ..................................................................................................................... 9 Explication ................................................................................................................... 9 Regression...................................................................................................................... 10 RESULT AND DISCUSSION ..................................................................................... 10 Descriptive Statistics ...................................................................................................... 11 Explication: ................................................................................................................. 11 CONCLUSION ................................................................................................................... 12 References ......................................................................................................................... 13

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Perceived Alternative Job and Turnover Intention

Abstract
This study analyzes the effect of job satisfaction and perceived alternatives employment opportunities on turnover intention. In this research, sample of 50 employees has been taken from different Non Government Organizations (NGO). The quantitative data analysis method was used to find out the relationship between dependent variable (turnover intention) and independent variable (perceived alternative job & job satisfaction). The results show that solely job satisfaction does not have a signification relationship with turnover intention. However, the interaction between job satisfaction and perceived alternatives employment opportunities does have a negative effect on turnover intention. In fact, perceive alternative employment opportunities have a positive effect on turnover intention. The conclusion suggests that more reliable measures should be developed when discussing the turnover intention in private sector organizations.

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Perceived Alternative Job and Turnover Intention

Introduction
The study of personnel turnover has attracted academic attention in the field of human resources management for several decades. It is widely believed that a significant amount of turnover adversely influences organizational effectiveness (Hom and Griffeth, 1995; Hom and Kinichi, 2001). By identifying the determinants of turnover, researchers could predict turnover behaviors more precisely and managers could take measures in advance to prevent turnover. Among the determinants of turnover, job satisfaction plays a major role in most theories of turnover (Lee et al., 1999) and operates as the key psychological predictor in most turnover studies (Dickter, Roznowski, and Harrison, 1996). According to Hom and Kinichi (2001), testing theories of how loss of job satisfaction progresses into job-termination has dominated turnover research over the past 25 years. The correlation between job satisfaction and turnover has been demonstrated in many meta-analytic findings (Trevor, 2001). However, such bivariate relationships do not address the importance of interactions in turnover prediction. The primary focus of this study is to go one step further and to investigate interactions of factors on turnover prediction. The public sector is often recognized for having a low turnover rate, especially when compared to that of the public sector. However, it might be asked whether low turnover rate is really equal to greater job satisfaction. Are there other exogenous variables affecting this relationship? Since private sector organizations have different recruitment, training, remuneration and pension fund systems from the public sector in Pakistan, it is clear that the environment variable should be taken into consideration. This study incorporates the variable of perceived alternative employment opportunities as the proxy variable of the environment when developing the analytical framework. By doing so, the explanation of turnover will be more complete. The results should be of use to other private sector organizations when investigating their determinants of turnover. The remainder of this paper is organized as follows. Following on from this introduction, the next section provides a literature review and develops hypotheses. And that is followed by a discussion of the research methodology adopted in this study. The descriptive statistics of the variables used in this analysis are then presented, while the penultimate section provides results of the analysis and an explanatory discussion. The implications of findings are provided in the closing section.

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Perceived Alternative Job and Turnover Intention

Literature Review
Job satisfaction
The relationship between job satisfaction and turnover is one of the most thoroughly investigated topics in the turnover literature. Job satisfaction has long been recognized as an important variable in explaining turnover intention. It is defined as the positive emotional response to a job situation resulting from attaining what the employee wants and values from the job (Lock et al, 1990; Olsen, 1993). This implies that job satisfaction can be captured by either a one-dimensional concept of global job satisfaction or a multi-dimensional, multi-faceted construct of job satisfaction that captures different aspects of a job situation; and which can vary independently and, therefore, should be measured separately. Additionally, job satisfaction is the extent to which employees like their work. Porter and Steers (1973) argued that the extent of employee job satisfaction reflected the cumulative level of met worker expectations. That is, job satisfaction is the extent of employees expectation that their job will provide a mix of features (such as pay, promotion, or self-rule), and for which each employee has certain preferential values. The range and importance of these preferences vary across individuals, but when the accumulation of unmet expectations becomes sufficiently large, there is less job satisfaction and greater probability of withdrawal behavior (Pearson, 1991). Busch et al., (1998) also pointed out that those who are relatively satisfied with their jobs would stay in them longer, i.e. reducing personnel turnover, and such staff are likely to be less absent. This study adopts turnover intention in preference to turnover as the dependent variable, because turnover intention is highly correlated with turnover, and the adoption of turnover may have a survival bias and thereby lead to an incorrect conclusion. Accordingly, turnover intention was chosen as the better analytical variable in this research.

Perceived Alternative Employment Opportunities

Previous studies suggest a stable negative relationship between job satisfaction and turnover. However, job satisfaction alone has been found to account for a small percentage of the total variance in a turnover modelless than a few percent (Blau and Boal, 1989). As is typical of most research on turnover, the focus was on members leaving rather than entering the organization. Moreover, as in much turnover Summer Project Report Page 4

Perceived Alternative Job and Turnover Intention research, attention was concentrated on the members voluntarily leaving the organization (Price, 1987). When employees consider leaving the organization, they will consider their attitudes toward their present jobs, and also evaluate what possibilities there are in the external environment. That is, they need to know the alternative employment opportunities in the labor market. Some studies used employment rate to represent the condition of the labor market. Price (2001) proposed a mediating process between labor market opportunities and turnover. Price (ibid) notes that propositions without intervening processes are often incomplete, so we have begun to offer mediating variables where appropriate. The inference of this is as follows: more opportunities produces greater employee awareness of alternative jobs in the environment, employees then evaluates the costs and benefits of these alternative jobs and, finally, if the benefits of the jobs appear to be greater than the costs, employees quit their jobs. In the private sector, the employees in an organization also need to consider the labor market conditions. However, the employment rate may not be an appropriate variable to evaluate the labor market. In Prices (2001) reflections on the determinants of voluntary turnover, the environment variable opportunity is also proposed. Opportunity is the availability of alternative jobs in the environment, and is the type of labor market variable emphasized by economists. For public sector organization employees, the alternative job opportunities are limited in some specific organizations. The total employment rate for a country or a local geographical area may not serve as a good explanatory variable. Some scholars propose perceived alternative employment opportunities to be the analytical variable (Hulin et. al, 1995; Steel and Griffeth, 1989). The concept 'Perceived alternative employment opportunities' refers to an individuals perception of the availability of alternative jobs in the organizations environment (Price and Mueller, 1996); it is a function of labor market conditions. Employees perceive more alternative job opportunities when the job market is floating and less job opportunities when the unemployment rate is high. It should be noted that perceived alternative employment opportunities is not the same thing as actual market conditions. But how employees perceive the conditions will undoubtedly affect their intention to change jobs.

Trevor (2001) summarized March and Simons (1958) model and concluded that job satisfaction and general job availability were interdependent. General job availability as a moderator of job satisfaction has been discussed in several conceptual models of voluntary turnover. Both Price (1991) and Muchinsky and Morrow (1990). Summer Project Report Page 5

Perceived Alternative Job and Turnover Intention

Methodology and Data Analysis

The purpose of this research is to examine the relationship between the turnover intention and perceived alternative, job satisfaction. Here we were using different non government organization as population, in which we selected the sample size of 50 employees.

Data Set & Sample

This work studies the effects of job satisfaction and perceived alternative employment opportunities on turnover intention. The scales were based on previous research and on scale development work conducted prior to final data collection. Questionnaires used five point liker type scales, which range from strongly disagree to strongly agree. The data used in this study was acquired physically from different organizations, internet and web sites of these firms. Here we were using different non government organization as population, in which we selected the sample size of 88 employees.

Variables
This study undertakes the issue of identifying key variables that influence the job intention. Choice of the variables is influenced by the previous studies on job intention. All the variables stated below have been used to test the hypotheses of our study.

Dependent Variable:
Turnover Intention: Employee turnover intention is an important factor for all businesses. Replacement or change in employees can badly effect to the businesss production and overall performance.

Independent Variables:
Perceived alternative job If I quit my current job, the chances that I would be able to fine another job which is as good as, or better than my present on is high and if I leave this job, I would have another job as good as this one within a month. Participants used a 1-5 rating scale numbered from 1 (strongly disagree), through 3 ( Neutral), to 5 (strongly agree).

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Perceived Alternative Job and Turnover Intention Job satisfaction Happiness or lack of it arising out of interplay of employees positive and negative feelings toward his or her work.

Hypotheses Testing
Since the objective of this study is to examine the relationship between job intention, perceived alternatives and job satisfaction, the study makes a set of testable hypothesis. H1: Job satisfaction negatively effects turnover intention. H2: Perceived alternative employee opportunities will positively effect turnover intention. H3: The interaction of job satisfaction and perceived alternative employment opportunities negatively affect turnover intention.

Model Specifications:
Here we are using the Regression data analysis. The general form of our model is: JI it = 0 + 1 (JS it) + 2 (PA it)+ Where: JI = Job intention JS = Job Satisfaction PA = Perceived Alternative

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Perceived Alternative Job and Turnover Intention

Analysis Used in Study

In this research we have provided two types of data analysis; descriptive and Regression.

Descriptive Analysis
Descriptive analysis is the first step in our analysis; it will help us describe relevant aspects of phenomena of cash conversion cycle and provide detailed information about each relevant variable, which includes Mean, Standard Deviation, Maximum and Minimum value of the data. SPSS software has been used for analysis of the different variables in this study.

Regression Analysis
We are using Regression analysis to estimate the causal relationships between profitability variable, liquidity and other chosen variables. So again SPSS software has been used for Regression analysis.

Data Analysis and Discussion

We have performed two types of analysis, Descriptive and Regression. The results of these two types of analysis are discussed in this section.

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Perceived Alternative Job and Turnover Intention

Descriptive Analysis
Descriptive analysis shows the average, and standard deviation of the different variables of interest in the study. It also presents the minimum and maximum values of the variables which help in getting a picture about the maximum and minimum values a variable can achieve.

Correlations
AJS AJS Pearson Correlation Sig. (2tailed) N Pearson Correlation Sig. (2tailed) N Pearson Correlation Sig. (2tailed) N 1 APAJ ATI

APAJ

88 -.144 .181 88 -.282** .008 88

ATI

88 .011 .916 88

88 1

88

Explication Table 1 provides basic statistics of major variables for the total sample. From the result, job satisfaction and perceived alternative employment opportunities are significantly correlated with turnover, and perceived alternative employment opportunities are negatively correlated with job satisfaction and turnover intention. The analysis shows that there is interaction between job satisfaction and perceived alternative employment opportunities, which is the main theme of this study.

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Perceived Alternative Job and Turnover Intention

Regression
Pearson Correlation ATI AJS APAJ Sig. (1tailed) ATI AJS APAJ N ATI AJS APAJ ATI 1.000 -.282 -.011 . .004 .458 88 88 88 AJS -.282 1.000 -.144 .004 . .090 88 88 88 APAJ -.011 -.144 1.000 .458 .090 . 88 88 88

RESULT AND DISCUSSION All of the models used to examine the above research hypotheses are analyzed by an ordinary least squares (OLS) method. The results for the total sample are reported in Table 2. The estimated coefficient of perceived alternative employment opportunities is positive and significant, and the interaction effect of job satisfaction and perceived alternative employment opportunities is negative and significant. However, job satisfaction does not significantly affect turnover intention. Therefore, these empirical results support H2 and H3, but not H1.

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Descriptive Statistics
N ATI AJS APAJ Valid N (listwise) 88 88 88 88 Minimum 2.60 2.38 2.00 Maximum 4.60 4.63 4.00 Mean 3.7409 3.4929 3.1773 Std. Deviation .38376 .45342 .41626

Explication: The above analysis shows that job satisfaction does not significantly affect turnover intention, which is contradictory to conventional wisdom: namely, that job satisfaction has a negative effect on turnover intention as in most previous literature. This finding could be explained when considering the characteristics of private sector organizations. Compared to the public sector organizations, an employee who chooses to enter a private organization already has prior knowledge of what they will gain before they enter the organization. Private sector organizations often have established rules of pay, reward, leave, and retirement conditions, so employees already know their costs and benefits. Under such conditions, the reason why they stay in an satisfaction, but for other reasons organization may not because of their Conversely, perceived alternative employment opportunities are proven to have a positive effect on turnover intention, meaning that when employees perceive their opportunities as high, their turnover intention is high as well. This is reasonable and consistent with previous studies. When employees perceive no alternative employment opportunities outside the organization, they will very likely stay in the original organizations because they may still need the job for living. On the other hand, when employees perceive many alternative employment opportunities, they may quit their jobs quickly because they are confident of finding a new job soon. This result contributes to the empirical research of turnover literature, which often ignores the importance of this variable. More interestingly, the interaction between job satisfaction and perceived alternative employment opportunities shows a negative effect on turnover intention. This conclusion may explain why job satisfaction only accounts for a few percent of turnover variance.

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CONCLUSION
This study has offered an interesting contribution to the field of job satisfaction and staff turnover. First, this investigation utilizes the private sector organization as the analytical data resource, which is seldom researched as compared to the public sector. Second, the study incorporates the variable of perceived alternative employment opportunities into the framework to emphasize the importance of environment. Third, the results show that the interaction of job satisfaction and perceived alternative employment opportunities negatively affects turnover intention, which could be the basis for further studies focusing on the interaction effects. In future, researchers could study the different measures of job satisfaction between public and private sector organizations. According to these results, the effect of job satisfaction on turnover intention is different in public and private sectors. There may be two sets of measures when considering their totally different organization characteristics. In addition, since job satisfaction only accounts for a few percent of the explanation of turnover, researchers might try to identify different moderating relationships between job satisfaction and turnover intention.

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References
http://articles.timesofindia.indiatimes.com/keyword/job-satisfaction http://articles.cnn.com/keyword/job-satisfaction http://www.chemicalprocessing.com/articles/2012/2012-salary-survey-jobsatisfaction-fig5.html http://www.foodprocessing.com/articles/2012/salarysurvey.html http://articles.timesofindia.indiatimes.com/keyword/job-satisfaction http://www.bizresearchpapers.com/Paper5.pdf http://books.google.com.pk http://psycnet.apa.org/index.cfm?fa=buy.optionToBuy&id=1982-10938-001

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