DETERMINANTS OF EMPLOYEE TENURE IN THE BANKING SECTOR OF GHANA
Date
2012-07-12
Authors
AGYEMANG, AMOS SARFO-
Journal Title
Journal ISSN
Volume Title
Publisher
University of Ghana , Legon
Abstract
The Ghanaian economy has witnessed an influx of banks in the past two decades. This
phenomenon however, brings to the fore issues of employee turnover as the banks compete for
efficient workers. A Bank of Ghana research for the period 2001 to 2007 discovered a year-onyear increase in the employee turnover costs incurred in the banking industry. In another
research, out of the 14 sampled countries in Sub Saharan Africa, the Bank of Ghana identified
Ghana to be the leading nation in terms of costs involved in the hiring and firing of employees.
Studies on employee tenure in the banking sector remains scarce in the Ghanaian context and
most available ones worldwide are single sided in their analysis; thus they seek to examine
employee tenure in relation to either individual or firm characteristics. The objective of the study
is to examine how both firm and individual characteristics influence employee tenure in the
banking sector of Ghana.
Multinomial logit regressions results from the study which employed primary data of randomly
sampled 138 employees across the commercial banks in Ghana revealed that current job tenure is
significantly influenced by individual characteristics such as level of education, age and
experience. Co-workers’ relations, workload and wages were found to be the firm characteristics
that significantly explained their current tenure. Job offer received was also proven to be
significant. Results from the logistic regression (binary logit) also suggested that gender, wages,
incentives and the years spent on the job were important determinants of the intent of tenure.
In line with the findings, it is recommended that banks should ensure satisfactory levels of wages
and incentives given to their employees. They should again embark on family-friendly policies
for their employees and also be circumspect in their recruitment activities.