Employee retention: Job embeddedness in the hospitality industry

Hospitality is a labour intensive industry, requiring human resources with various skilllevels, ranging from unskilled positions to positions that require high levels of services andcustomer contact skills. Despite the industry relying heavily on employees, high turnover ratesand associated cost of turnover and low retention of skilled employees are issues that plague thehospitality industry (Baum, 2008; Carbery, Garavan, Orien & McDonnell, 2003; Hinkin &Tracey, 2000; Walsh & Taylor, 2007). Recent turnover research in 64 four to five star Australian hotels showed turnover rates of 50.74% for operational employees and 39.19% for managerial employees; furthermore, the average cost of replacing an operational employee is A$9,591, with higher costs for replacing a managerial employee (Davidson, Timo & Wang,2009). The costs of turnover are not only monetary, it can also lead to customer dissatisfaction,decreased employee morale, decreased productivity, inconsistent service quality, impacting on business acumen and organisational performance (Cho, Johanson & Guchait, 2009).Accordingly, hospitality employee turnover, job satisfaction, organisational commitment and retention strategies are frequently researched areas (Birdir, 2002; Deery, 2008; Tracey & Hinkin, 2008).