Organizational And Economic Determinants Of Labor Turnover In Four And Five Star Hotels In Addis Ababa, Ethiopia

Abstract

High labor turnover in the hospitality sector, particularly in four- and five-star hotels in Addis Ababa, Ethiopia, presents significant challenges, including increased recruitment costs, operational disruptions, xiii and reduced service quality. Understanding these factors is crucial for enhancing employee retention and customer satisfaction.This study aimed to investigate the key factors influencing labor turnover in this sector. Using a mixed-methods approach, quantitative data were collected through structured questionnaires distributed to 240 hotel employees via simple random sampling, complemented by qualitative insights from in-depth interviews with hotel management.The findings revealed that poor working conditions, inadequate compensation, limited career development opportunities, and ineffective management practices significantly contribute to labor turnover. Statistical analysis indicated strong positive correlations between these variables and turnover intentions, with p-values below 0.01.These insights underscore the importance of fostering a supportive work environment, offering competitive compensation, and providing clear pathways for career advancement. The implications of high turnover are profound, affecting financial performance and service consistency.To address these challenges, the study recommends enhancing working conditions, benchmarking compensation packages, promoting career development initiatives, and strengthening management practices. This research contributes valuable knowledge to the Ethiopian hospitality sector, highlighting the need for tailored strategies to mitigate turnover in high-end hotels.