Pay Satisfaction, Job Satisfaction, Organizational Commitment and Turnover Intention in Taiwan Banking: Structural Equation Modeling

Various investigators have researched voluntary employee turnover intention within both the private and public sectors. However, little is known about employee turnover intention within the domestic private banking industry in Taiwan. This study examined the fundamental theoretical literature and empirical studies related to employee turnover intention among Taiwanese domestic private banking employees.

The relationship among pay satisfaction, job satisfaction, organizational commitment and voluntary employee turnover is an important issue for any organization. Employee turnover as the result of practices within the fields of economics, human resource management, organizational behavior, psychology, and ethics have been examined in this study. This research explored those factors influencing employee turnover intention, and identified areas of future scholarly inquiry. Findings indicated that employee turnover intention is complex. Existing turnover models are unable to comprehensively explain turnover. However, existing turnover theories provide a framework within which to research the topic. Contemporary turnover theories provide valuable information for leaders to use to improve their leadership styles, training procedures, and policies, and are very useful in predicting turnover or decision-making.

The purposes of this study were to explore the relationship among pay satisfaction, job satisfaction, organizational commitment, and turnover intention in the Taiwanese domestic private banking industry; to describe the degrees of pay satisfaction, job satisfaction, organizational commitment, and turnover intention of entry-level and mid-management branch office employees of Taiwanese domestic private banks and their sociodemographic characteristics; to examine existing pay satisfaction, job satisfaction, organizational commitment, and turnover theories as well as some conflicts between different theories; and to explore whether pay satisfaction plays a critical role in turnover decisions.

Three research questions and 23 hypotheses were developed for this quantitative, non-experimental study. Further, this study adopted an explanatory and correlational survey to answer those questions and hypotheses using descriptive statistics, confirmatory factory analysis, and Structural Equation Modeling (SEM).

Future studies may try to examine related variables in different groups, industries, cultures, or countries, and explore the relationship between employee turnover intention and the actual departure of an employee.