Employee retention relationship to training and development: A compensation perspective

Employee retention is a critical aspect for every company regarding competitive advantage because human resource is the most critical asset of today’s modern world. Other resources can be arranged effortlessly but to get efficient and retain talented human capital is the most difficult task. Therefore, organizations are now more focused towards employee retention. Organizations use different HR techniques for retention. Our main emphasis is on compensation packages after employee training and development practices for retention purposes. We will also see how a relaxed work environment will help in the retention of employees. For this purpose, we conducted this study in Lahore and collected data from corporate groups. The numbers of respondents in our study are 330. For analysis we used the structural equation modeling technique with the use of AMOS 18.0.  In this study, we used compensation as the mediating variable between the training and retention of employees.  Results reveal that retaining employee’s long term, after their training and development has been completed, without increasing their compensations is not as favorable as when compensation is increased to reflect the completion ability to apply their field related skills and capabilities.   Key words: Retention, training and development, compensation, work environment.