Increasing human and social capital by applying job embeddedness theory

Employee turnover is costly to organizations. Some of the costs are obvious (recruiting, selecting, and training expenses) and other are not so obvious (diminished customer service ability, lack of continuity on key projects, and loss of future leadership talent). Understanding the value inherent in attracting and keeping excellent employees is the first step toward investing systematically to build the human and social capital in an organization. The second step is to identify retention practices that align with the organization's strategy and culture. This article presents a framework for creating this alignment--a theory the authors call job embeddedness. Across multiple industries, job embeddedness is a stronger predictor of important organizational outcomes, such as employee attendance, retention and performance than the best, well-known and accepted psychological explanations (e.g., job satisfaction and organizational commitment). The third step is to implement the ideas. The article discusses examples from the Fortune 100 Best Companies to Work For and many others to demonstrate how job embeddedness theory can be sued to build human and social capital by increasing employee retention.