EFFECTS OF REMUNERATION ON EMPLOYEE RETENTION IN HOTELS IN KENYA
Abstract
Purpose of the Study: The purpose of this study was to examine the effects of remuneration on employee retention in the hotel industry in Kenya. The objective of the study was to establish the effect of remuneration on employee retention in the hotel industry Kenya.
Problem Statement: The hotel industry in Kenya falls short of the industries turnover average and still leads in employee turnover. In the year 2011, labor turnover was at 68% in five star rated hotels. Today, the industry is confronted with the continuously evolving challenge of demand for retention of appropriate talent. Consequently, this has impacted negatively on hotel business sustainability due to high costs of training new employees, replacement and separation for the departing employees as well as affecting customer satisfaction.
Research Methodology: This research problem was studied through the use of a survey research design. The target population of this study comprised of 213 hotels registered under Kenya Association of Hotelkeepers and Caterers in Kenya. A representative sample of 137 hotels was selected from each hotel region using stratified random sampling. Data was collected using structured questionnaire administered by the researcher to get response from the sample population. A pilot test was conducted to test the reliability and validity of the data collection instruments. Descriptive and inferential statistics were used to analyze the data.
The results and findings of the study: The study established that remuneration influences employee retention in the hotel industry in Kenya both positively and significantly.
Conclusion: The study concluded that an effective remuneration system is one that enables an organization to attract, retain and motivate its employees.
Recommendation: The study recommended that the management of the hotel industry should review their remuneration structure to consider the current high cost of living.
Key Words: Remuneration, Employee Retention, Hotel Industry
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