Employee Voluntary and Involuntary Turnover and Organizational Performance: Revisiting the Hypothesis from Classical Public Administration

Abstract

This paper examines the effects of voluntary, involuntary, and absolute turnover rates on organizational performance. Adopting human capital and cost-benefit theories, this manuscript posits that voluntary and involuntary turnover would have a linear negative and an inverted U-shaped relationship with organizational performance, respectively and that an absolute turnover measure can prevent us from revealing the distinct effects of different types of turnover. Using four years of data from Florida school districts, primary findings suggest that involuntary turnover has an inverted U-shaped relationship with organizational performance, first positive and then negative, while the relationship between voluntary turnover and organizational performance remains inconclusive. The findings also suggest that absolute turnover rates can mask the complex and dissimilar impact that various types of turnover have on organizational performance.

Keywords: Voluntary Turnover, Involuntary Turnover, Organizational Performance, Turnover-Performance Relationship