Enhancing Employee Retention Through the Implementation of Talent Management: Evidence of the Mediating Roles of Employee Engagement and Job Satisfaction.

Abstract

This study aims to examine the implementation of talent management in enhancing employee retention, with employee engagement and job satisfaction as mediating variables. Using a quantitative approach, data were collected through an online questionnaire with 194 permanent employees at the business unit of PT Nusantara Sebelas Medika as respondents. The research instrument employed a five-point Likert scale. Data analysis was conducted using Structural Equation Modeling based on Partial Least Squares (SEM-PLS) with SmartPLS software. The results indicate a significant positive effect between talent management and employee retention, talent management and job satisfaction, talent management and employee engagement, employee engagement and employee retention, as well as job satisfaction and employee retention. Furthermore, the mediation analysis reveals that employee engagement significantly mediates the relationship between talent management and employee retention, and job satisfaction significantly mediates the effect of talent management on employee retention. These findings confirm the theoretical model of Social Exchange Theory, wherein a reciprocal relationship exists between the organization and its employees, effective and structured talent management practices lead employees to respond with positive attitudes and behaviors, which in turn enhance employee engagement and job satisfaction, and ultimately improve employee retention. From a practical perspective, organizations can benefit from this study to formulate more effective and sustainable human resource management strategies, as well as to establish a stronger foundation for developing strategic policies aimed at retaining high-potential and high-performance employees. One limitation of this study is that it was conducted within a single organization, which restricts the generalizability of the findings.