Work Engagement: The Impact of Psychological Capital and Organizational Justice and Its Influence on Turnover Intention

Abstract

Objective - To remain competitive, organizations must be able to adapt to change and increase their performance. In order to increase performance, organizations must focus on how they manage their employees, including how to retain them. Previous studies have shown that work engagement (WE) has a positive effect on employee retention (Schaufeli & Bakker, 2004). The JD-R Model suggests that WE is influenced by enhancing personal and job resources (Schaufeli, 2017). This research aims to investigate the impact of both of those resources on WE. The personal resource measured in this study is psychological capital while the job resource measured is organizational justice. Furthermore, this research also aims to determine the extent to which WE can be used to predict employee turnover. Methodology/Technique - A quantitative method is implemented in this study by distributing a Utrecth Work Engagement Scale, Psychological Capital Questionnaire, Organizational Justice Questionnaire, and Turnover Intention Scale to 243 employees working in a manufacturing company in Jakarta, Indonesia. Findings - The results of this research conclude that psychological capital and organizational justice have a significant effect on WE (F= 15.231; p <0.05). Further analysis also concludes that WE has a significant impact on employee turnover (F= 10.888; p <0.05). Novelty - The findings of this study indicate that organizations should create and maintain employees WE in order to increase employee retention, while WE can be promoted by improving the psychological capital and providing fair treatment to all employees. Type of Paper: Empirical. Keywords: Organizational Justice; Psychological Capital; Turnover Intention; Work Engagement. JEL Classification: M10, M12, M19.