The Influence of Leadership Challenges on Employee Retention: The Mediating Role of Organizational Commitment

Despite the rising cost of turnover, recruitment and training, the issue of employee retention continues to be one of the crucial challenges that all organizations have to address, whether they are publicly or privately held. Leaders are responsible for shaping up employees’ working experience and making them decide to stay in the organizations. At the same time, various challenges that leadership faces, including poor communication, inconsistent decision-making, and lack of sufficient support from leaders to employees, as well as lack of employee recognition, continue to impact the organizational performance. This study analyzed the impact of leadership challenges on employee retention and the mediating effect of organizational commitment in this relationship. Based on social exchange theory, organizational commitment theory, and transformational leadership theory, the study suggested that leadership challenges negatively impact the commitment of employees to the organizations, which influences their desire to continue employment in the organizations. A quantitative cross-sectional research design employing Partial Least Squares Structural Equation Modelling (PLS-SEM) applied to test the suggested hypotheses. It is expected that the results will add more evidence to the existing literature on leadership and retention.