Voluntary Turnover and Job Performance: Curvilinearity and the Moderating Influences of Salary Growth, Promotions, and Labor Demand
Gerhart, Barry A.; Boudreau, John W.; Trevor, Charlie O.
In this study we investigated the relation between job performance and voluntary employee turnover for 5,143 exempt employees in a single firm in the petroleum industry. As hypothesized, we found support for Jackofsky's (1984) curvilinear hypothesis as turnover was higher for low and high performers than it was for average performers. Three potential moderators of this curvilinearity were examined in an attempt to explain conflicting results in the performance turnover literature and contradictory predictions from turnover models. As predicted, pay growth, promotions, and labor demand each differentially influenced the turnover patterns of low, average, and high performers. Most notably, paying high performers according to their performance predicted substantial decrements in turnover. A utility analysis indicated that the benefits of paying high performers according to their performance more than offset the costs and that such an approach was a superior strategy when compared to a more egalitarian pay growth policy.
human resource; human; resource; turnover; job; performance; salary; promotion; labor; demand; employee; industry; model; pay; perform; cost; promotion