STRATEGIC HUMAN RESOURCE MANAGEMENT PRACTICES AND EMPLOYEE RETENTION IN THE MANUFACTURING SECTOR: THE ROLES OF ORGANIZATIONAL COMMITMENT, JOB SATISFACTION, WORK EXPERIENCE, AND JOB HOPPING

Abstract

This study examines the influence of strategic human resource management (SHRM) practices compensation, employee participation, training and development, performance appraisal, supervisor support, and occupational health and safety on organizational commitment, job satisfaction, and employee retention within the manufacturing sector in Banten, Indonesia. Using a quantitative cross-sectional survey of 268 respondents and Structural Equation Modeling Partial Least Squares (SEM–PLS), the findings demonstrate that four HR practices compensation, participation, training and development, and performance appraisal significantly enhance organizational commitment, while supervisor support and health and safety do not exhibit significant effects. Organizational commitment strongly predicts both job satisfaction and employee retention, with job satisfaction serving as a significant mediator in the commitment–retention relationship. Work experience moderates the relationship between supervisor support and commitment, indicating that employees with longer tenure are less influenced by supervisory support. Conversely, job hopping does not significantly moderate the commitment–retention link. Overall, the model demonstrates strong predictive relevance, highlighting the central role of commitment and satisfaction in shaping employee retention outcomes. These findings reinforce existing theoretical perspectives from Social Exchange Theory and the JD-R framework, while providing contextual insights for improving HRM strategies in Indonesia’s manufacturing industry.