The Effect of Training and Development on Employee Retention: The Mediating Role of Psychological Empowerment in the Banking Sector of Pakistan

Abstract

This study investigates the impact of training and development (TD) on employee retention (ER) in Pakistan’s banking sector, with psychological empowerment (PE) as a mediating variable. Using a quantitative approach, data were collected frsize om 311 employees of commercial banks who participated in training programs. Structured questionnaires measured TD, PE, and ER, with reliability analysis, correlation, and regression techniques applied to test hypotheses. Findings reveal that TD does not significantly predict ER (β = .044, p = .437), contradicting prior research, likely due to the TD scale’s low reliability (α = .140) and training’s lack of relevance. PE, however, strongly predicts ER (β = .549, p < .001), explaining 30.2% of the variance, highlighting its role in fostering loyalty. The non-significant TD-PE correlation (r = -.060, p = .294) indicates no mediation by PE. Demographic trends suggest younger employees (82% aged 25-34) may prioritize mobility, influencing perceptions.