Career Development and Employee Retention in Insurance Companies in Nairobi City County, Kenya

Abstract

Organizations face some challenges when it comes to highly trained and experienced staffs as they are attractive to many employers in different industries. The changes in the working place, work pressures and market demands have led to high turnover of talented and highly performing employees. Organizations must seek means of retaining its top performing stay. This study sought to consider measures taken by organizations to retain their employees and concentrated on career development in insurance companies in Nairobi City County. The study variables included assessing the effect of training and development, mentoring and coaching, job enrichment and career planning on employee retention. The study was anchored on these theories; the human capital theory, Herzberg’s two factor theory, theory of work adjustment and embeddedness theory. The study adopted the use of descriptive research design and targeted all the 61 insurance companies and the respondents were included human resource managers, operations managers and finance managers. The study employed stratified, purposive and census sampling techniques in the selection of a sample size of 183 respondents. The researcher used structured questionnaires in collecting data that was first pilot tested to check for its validity and reliability. The instruments were dropped at the respondents’ work places and collected after a week for processing and analysis. Data analysis was done using SPSS and using descriptive analysis that obtained means, frequencies and standard deviations and multiple regressions showed how variables were related. The findings were presented in tables, pie-chart, bar graphs and discussions. The regression analysis showed that 78.1% change in employee retention was due to career development. Career planning had the largest effect to employee retention with R values of 0.637, followed by training and development at R values of 0.612. Job enrichment affected employee retention with R values of 0.584 and mentoring and coaching had the least effect on employee retention based on R values of 0.455. Further results showed that all the career development in the study had positive effects to employee retention in the insurance companies since p-values < 0.05. Thus, the study concludes that career development and its elements positively and significantly affected employee retention in the insurance companies in Nairobi City County. The study recommends that the management in these insurance companies should adopt career development as a means of improving employee retention rates. Other companies in different industries and sectors concerned with employee retention can adopt elements of career development.