HR Practices and Employee Retention: A Study on Automotive Manufacturing Organizations in Malaysia
Keywords:
Employee retention, rewards & benefits, performance management, career development, leadership behavior.
Abstract
Employee retention remains a critical challenge within the automotive manufacturing sector, where the loss of skilled talent can significantly disrupt operations and competitiveness. This study investigates the impact of four key human resource (HR) practices - rewards and benefits, career development, performance management, and leadership behavior - on employee retention within a major automotive manufacturing organization in Peninsular Malaysia. Grounded in Herzberg’s Two-Factor Theory, a quantitative research design was employed, and data were collected via a survey questionnaire from 650 executive-level employees across the Selangor and Melaka branches, achieving a 95 percent response rate. Statistical analysis was conducted using SPSS version 26, incorporating descriptive, reliability, and multiple regression analyses to examine the relationship between HR practices and employee retention outcomes. The findings indicate that all four HR practices significantly influence employee retention, with career development showing the strongest relationship. The findings emphasize the need for strategic alignment between HR policies and employee expectations to reduce turnover and foster long-term organizational commitment. This study offers both theoretical and practical implications by reinforcing the role of comprehensive HR practices in shaping employee behavior and organizational stability. It provides actionable insights for HR professionals and decision-makers within Malaysia’s manufacturing sector to enhance workforce retention and maintain competitiveness in a dynamic labor market.
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References
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Khan, M. (2013). Role of the performance appraisal system on employees’ motivation. IOSR Journal of Business and Management, 8(4), 66–83.
Khazei, B. (2019). Career development strategies and their influence on employee engagement. International Journal of Human Resource Studies, 9(2), 201–218. https://doi.org/10.5296/ijhrs.v9i2.14967
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Laing, I. F. (2019). The impact of employee retention on performance: The moderating role of innovation capability in the Nigerian manufacturing sector. Journal of Strategic Human Resource Management, 8(1), 20–30.
Larsen, G., Gunawan, H., & Sumali, B. (2018). The role of leadership style and employee engagement in enhancing work performance. International Journal of Business and Management, 13(9), 37–48. https://doi.org/10.5539/ijbm.v13n9p37
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Liberty, M. (2023). The evolving workforce: A post-pandemic review of labor trends. Global HR Outlook, 17(4), 23–30.
Lyman, W., Yerby, J., & Rogers, R. (2020). An examination of factors impacting employee retention in healthcare. Journal of Organizational Psychology, 20(2), 89–102.
Mahadi, N., Woo, B. K. P., Baskaran, S., & Yaakop, A. Y. (2020). Employee retention in Malaysian SMEs: The role of human resource practices and organizational commitment. Asian Journal of Business Research, 10(1), 67–84.
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Mone, E. M., Eisinger, C., Guggenheim, K., Price, B., & Stine, C. (2018). Performance management at the wheel: Driving employee engagement in organizations. Journal of Business Psychology, 33(3), 345–356. https://doi.org/10.1007/s10869-017-9501-8
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Published
2025-08-10
How to Cite
Zulkarnain, S. N., Zakaria, R., Hussein, N., Dahalan, N. A., Abg Abdullah, D. N. M., & Samat, N. (2025). HR Practices and Employee Retention: A Study on Automotive Manufacturing Organizations in Malaysia. Information Management and Business Review, 17(2(I)S), 145-158. https://doi.org/10.22610/imbr.v17i2(I)S.4581
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Copyright (c) 2025 Siti Nadhirah Zulkarnain, Ridhawati Zakaria, Norashikin Hussein, Noor Azura Dahalan, Dayang Nailul Munna Abg Abdullah, Nusrah Samat
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