Page 1 of 10

Journal for Studies in Management and Planning

Available at http://internationaljournalofresearch.org/index.php/JSMaP

e-ISSN: 2395-0463

Volume 01 Issue 11

December 2015

Available online: http://internationaljournalofresearch.org/ P a g e | 319

The Impact of Job Satisfaction, Perceived Availability

of Job Alternative on Turnover Intention

Faria Rabbi ; Fateme Kimiya ; Muhammad Farrukh

Institute of Graduate Studies, SEGi University, Kota Damansara,Malaysia

fariarabbi@hotmail.com

Abstract

Turnover is a phenomenon, which every

organization deals with. When less

productive employees voluntarily quit their

job, it can be functional for an

organization. Conversely, when highly

desirable employees decide to leave, it can

have a significant negative impact on the

organization. Recruitment costs, training

costs, low productivity, loss of critical

knowledge and operational disruptions can

decrease organizational effectiveness.

Turnover intention is often characterized as

a precursor to actual turnover, hence the

importance of study and understanding

turnover intentions if employees.

Particularly now, in times of crisis, it is

important for organizations to ensure that

they do not lose their highly talented

employees while trying to survive the

economic downturn. Globally there is a

shortage on and a high demand for highly

talented employees; it is a challenge for

organizations to recruit but more

importantly, to retain these employees.

According to the literature, when

employees are satisfied, they intend to stay

in the organization and when they are

dissatisfied, they think about quitting.

Furthermore, if the employee perceives

employment opportunities in the labor

market, the intention to quit or stay is

affected. The objective of this study is to

check the affect of perceived available job

alternatives on the relationship between job

satisfaction and turnover intentions

A significant moderating effect was

identified, since the survey results show

interestingly, that employees who are

satisfied and have high perceptions of

available job alternative will still have

higher intention to quite their job in

comparison with satisfied employees who

have low perceptions of available job

alternatives.

Key words: Turnover intention, job

satisfaction, perceived available, job

alternative, banking, and moderating effect.

Introduction

This thesis is a study of employee turnover

intentions. More specifically the study

looks into the relationship between

employees’ job satisfaction, their

perception of available job alternatives and

their turnover intentions. In case of

employee dissatisfaction or actual turnover,

companies could face difficulties to retain

key employees; low employee motivation,

significant turnover cost; loss of critical

intangible knowledge and skills; decreased

productivity; low performance and finally

decreased organizational effectiveness.

Page 2 of 10

Journal for Studies in Management and Planning

Available at http://internationaljournalofresearch.org/index.php/JSMaP

e-ISSN: 2395-0463

Volume 01 Issue 11

December 2015

Available online: http://internationaljournalofresearch.org/ P a g e | 320

Therefore, this study will mainly look into

the relationship between job satisfaction

and the intent to leave the organization

during these times of economic downturn.

The banking sector is an integrated

industry. The industry has traditionally

been one of the most developments drivers

of the Bangladesh economy. And one of the

largest private sector employers in the

country. in the last five years the banking

industry in Bangladesh has been subject to

an ever increasing competitive business

environment. One important organizational

effect is the impact on the employed human

resources. Whilst the organization operates

in “crisis-survival” mode, the perceived

impact on human resources regards

employee behavioural challenges like:

performance pressure, job stress, job

security, low labor productivity,

motivational issues and difficulties in

attracting and retaining valuable and high

performance talent.

Even though there are many studies

connected to job satisfaction and turnover

intentions, there is limited research done in

different country contexts (e.g.

Bangladesh) and certainly not with special

reference to the banking industry.

Job Satisfaction

Job satisfaction is closely related with the

motivation, performance, commitment,

retention and turnover, have been among

the most popular research topics in the field

of organizational behaviour. Many

researchers have contributed to the general

believe that employee needs, beliefs,

feelings and satisfaction therefore are

critical for organizational performance and

effectiveness. Job satisfaction represents

employees’ feelings regarding their job. If

job satisfaction is low the job is affected

negatively. Conversely, if it is high,

employees increase their efforts and

management see less employees quit their

job.

Perceived Available Job Alternatives

The consideration made in this study is

mostly based on the concept of perceived

effortlessness of movement from current

job to another job or to a job alternative. It

must be noted that the other the alternative

job is perceived to be outside of the

organization. Perceived availability refers

to the how easy it is to move from one job

to another job. This is derived from their

perception about the jobs or job alternatives

being available or attainable to them. Thus,

the perceived available job alternatives are

based on employee perceptions of their own

marketability and perceptions of available

opportunities in the labor market.

Turnover Intention

In this study turnover intention relates to

voluntary employee turnover intention.

Unlike actual turnover, turnover intent is

not explicit. Intentions reflect behavior; and

turnover intentions reflect withdrawal

behavior. Apart from actual turnover,

turnover intention is considered a conscious

and deliberate desire to leave an

organization within the near future and is

considered as the last part of a sequence in

the withdrawal cognitive process (Sok Foon

et al., 2010 cited from Mobley, Horner &

Hollingsworth, 1978.

Page 3 of 10

Journal for Studies in Management and Planning

Available at http://internationaljournalofresearch.org/index.php/JSMaP

e-ISSN: 2395-0463

Volume 01 Issue 11

December 2015

Available online: http://internationaljournalofresearch.org/ P a g e | 321

Inter-linkage between job satisfaction,

Perceived Available Job Alternatives and

Turnover intention

In Mobley’s 1977 article, he theorized that

lack of job satisfaction led to thinking about

quitting, which led to job search, which

could then lead to an intention to quit, or

vice versa, which could eventually result in

actual turnover. Lambert, Hogan & Barton

(2001) found that job satisfaction

significantly impacted turnover intentions

and perceived availability of jobs also had a

relation with turnover intentions.

All these aforementioned findings make

reference to the linkage of the variables.

This linkage informed the conceptual

model, which is derived from the notion

that employees in the banking industry

currently experience low job satisfaction,

focus on external job alternatives and

subsequently develop an intention to leave

their employer.

Altogether, it can be assumed that during

the economic downturn, the competitive

existence of an organization significantly

relies on effectively managing staff

turnover and ensuring that good performers

and key personnel are motivated to stay and

have no intentions to quit.

The established, inverse relationship

between job satisfaction and employee

turnover intention is very important to

research in organizational behavior. One of

the main goals of turnover research is to

measure actual employee turnover,

however, employee turnover data is often

inaccessible to researchers. Frequently, this

data is unavailable because it is not

accurately or consistently collected. Thus,

researchers must rely employee turnover

intention as a proxy for actual employee

turnover. After all, stated Lambert et al.

(2001), measuring turnover intention is the

next best method, because it is the variable

that consistently and immediately precedes

actual employee turnover. Throughout this

paper, employee turnover and turnover

intention will be used interchangeably.

In various studies, turnover has often been

directly related to organizational

effectiveness. Sakarnah (2009) cites

Vandenberg and Nelson (1999) who even

claim that turnover is an index of

organizational effectiveness. According to

Morrell et al. (2001) annual employee

turnover can be measured by dividing the

amount of leavers per year by the average

amount of employees in that same year. The

outcome is then multiplied by 100 in order

to denote it in a percentage. Criticism on

this formula resulted in the understanding

that the calculation did not make a clear

distinction between the turnover

characteristics like the voluntariness,

avoidance and the functionality.

Morrell et al. (2001) refer to voluntary

turnover as “voluntary cessation of

membership of an organization by an

employee of that organization”. The

contrary is conceptualized as involuntary

turnover and defined as “movement across

the membership boundary of an

organization, which is not initiated by the

employee” (Price, 1977: p.9 cited by Perez,

2008). Voluntary turnover is initiated by the

employee, by terminating the employer- employee relation in the form of

resignation. Turnover not initiated by the

employee could be forms of dismissals and

death.