Effect of Employee Maintenance and Training Costs on Organizational Performance

Abstract

This study examined the effect of employee maintenance and training cost on performance of firms in Delta State between 2016 -2020 financial years. The objectives of the study are to examine the extent to which employee maintenance cost affects financial performance of firms. Also, it looks at how employee training cost affects financial performance of manufacturing firms in Delta State. The study adopted the longitudinal research design and the data collected were analysed using ordinary least square regression analysis, descriptive statistics, and correlation analysis. However, the study used hausman effect test to check between fixed and random effect that play on the data. Employee maintenance and training costs were proxy; while firm performance was proxy by return on assets. The study found that employee maintenance cost (0.02) and training cost (0.01) has positive and significant effect on the financial performance of organization. The study concluded that manufacturing firms should invest on human resource development to be able to have competitive edge over competitors in order to achieve the wealth maximization objectives. Based on the findings, the study recommended among others, that management of firms operating in Delta state should reduce their funding of human resource maintenance, as increase may negatively and significantly impact on the performance of firms operating in Delta state. Also, that management of firms operating in Delta state should increase their spending on training their human resource.