Human Resource Strategies for Ensuring Employee Retention in Third-Party In-House Service Operations

Abstract

Employee retention is critical for maintaining stable business operations, particularly within the complex framework of third-party in-house service agreements. This study investigates the influence of Human Resource (HR) strategies on employee retention among production workers in third-party in-house service operations at Light Industry Science Park 1 (LISP 1) in Cabuyao, Laguna. Using a descriptive-correlational research design, the study analyzes five core HR strategies: Training and Development, Compensation and Benefits, Employee Engagement and Recognition, Career Growth and Advancement, and Performance Appraisal and Feedback Systems. The research is grounded in the Social Exchange Theory (SET) and the Ability-Motivation-Opportunity (AMO) framework. Data gathered from 216 respondents reveal that while all HR strategies are implemented effectively, Career Growth and Advancement Opportunities emerged as the only statistically significant predictor of employee retention in this specific industrial context. Spearman’s rho correlation further confirms a significant moderate positive relationship between the overall implementation of HR strategies and employee retention. The findings suggest that organizations can effectively stabilize their workforce by shifting from transactional employment to a "career destination" model that prioritizes transparent internal mobility and "feedforward" coaching. The study concludes with a proposed implementation matrix designed to enhance workforce stability by aligning professional aspirations with organizational goals.