Determinants of Employee Retention in the Retail Sector: A Study of Compensation, Career Development, and Work Environment

Abstract

Employee retention is a persistent challenge in the retail sector, where high turnover imposes substantial costs and disrupts service. This study examined the influence of three human resource determinants, namely compensation, career development, and work environment, on employee retention among retail employees in India, and assessed their relative contributions. A quantitative, cross-sectional survey design was adopted, and data were collected from 320 retail employees using validated measures of compensation satisfaction, career development opportunities, work environment, and intention to stay. The data were analysed using descriptive statistics, Pearson correlation, and multiple linear regression. The results indicated that all three determinants were significantly and positively related to retention, and that together they explained a substantial proportion of the variance in the intention to stay. Career development opportunities emerged as the strongest predictor, followed by compensation and work environment. The findings suggest that, while pay remains important, opportunities for growth and a supportive work environment are also central to retaining retail employees. The study recommends a balanced retention strategy that combines competitive compensation with clear career pathways and a positive work environment, and discusses implications for managers and human resource practitioners in the retail sector, where the retention of frontline staff is critical to performance.