Employee Empowerment and Turnover Intention in the U.S. Federal Bureaucracy

Abstract

Reducing employee turnover in the U.S. federal government has been an ongoing goal of policymakers in Washington, D.C. A large literature emerging during the last three decades has identified a range of antecedents of turnover intention and actual turnover, including individual characteristics, employee attitudes, organizational conditions, and managerial practices. Little research has been done, however, on the impact of employee empowerment as a multifaceted managerial approach on turnover options in the public sector. This study proposes a theoretical model of the direct and indirect effects of employee empowerment on turnover intention in the U.S. federal bureaucracy. The model is tested using structural equation modeling (SEM) and data from the U.S. Federal Employee Viewpoint Survey (FEVS). The empirical results support the hypothesized model. Employee empowerment has negative direct and indirect effects on turnover intention. In addition, the negative effect is greater on the likelihood of intention to leave to another federal agency and intention to leave the federal government than on the intention to retire.

Keywords

employee empowerment turnover federal bureaucracy

Although the concept of employee empowerment has deep roots stretching back to the Human Relations Movement, widespread adoption of employee empowerment programs did not occur until the 1990s. Employee empowerment has been defined as either a psychological state in which employees experience increased intrinsic task motivation or enhanced feelings of self-efficacy at work (e.g., Spreitzer, 1995; Thomas & Velthouse, 1990) or as a managerial approach aimed at sharing information, resources, rewards, and authority with frontline employees (e.g., Bowen & Lawler, 1992, 1995). In a variety of industries, including food and hospitality, nursing, education, and government, employee empowerment practices have been found to be effective at raising performance (Kirkman & Rosen, 1999; Lawler, Mohrman, & Ledford, 1992, 1995; H. Lee, Cayer, & Lan, 2006; Spreitzer, 1995), encouraging innovation (Fernandez & Moldogaziev, 2013b; Spreitzer, 1995), and improving employee attitudes like job satisfaction, organizational commitment, and job involvement (Coye & Belohlav, 1995; Fulford & Enz, 1995; Guthrie, 2001; Kim, 2002; Kirkman & Rosen, 1999; Lawler et al., 1992, 1995; H. Lee et al., 2006; Wright & Kim, 2004; Wu & Short, 1996). We know less, however, about the effects of employee empowerment on turnover intention and actual turnover in the public sector.

Concerns about high turnover in the federal government are as old as the founding of the American republic (White, 1948). During the last two decades, reports issued by the National Commission on the Public Service (Volcker, 1989) and the U.S. Senate Committee on Governmental Affairs (United States Senate, Committee on Governmental Affairs, 2000a, 2000b) expressed growing concern about high turnover in the federal bureaucracy. More recently, a study by the Society for Human Resource Management (2012) found that the federal government had a voluntary turnover rate of 17% in 2011, a figure significantly higher than that found in various other industries. The Federal Times reported that from 2010 to 2011, spikes in rates of retirement and voluntary turnover had contributed to the largest decline in the federal workforce since 1999 (Losey, 2012). High turnover is of grave concern because of its deleterious effects on organizations, including loss of institutional knowledge and memory, declining morale, rising backlogs, decreasing productivity, and additional costs for recruitment, selection, and training of new employees (see Boushey & Glynn, 2012; Cho & Lewis, 2012; Kim, 2005; Selden & Moynihan, 2000).

A handful of studies exploring the impact of employee empowerment practices on turnover indicate such practices can reduce turnover intention and actual turnover (Arthur, 1994; Gardner, Wright, & Moynihan, 2011; Grissom, 2012; Moynihan & Landuyt, 2008). These studies have made important contributions to the literatures on empowerment and turnover, but they have their limitations. These studies have either conceptualized employee empowerment as a one-dimensional construct (e.g., focusing just on discretion) or they have operationalized empowerment using a single indicator. As a result, they have not captured the full breadth and content of employee empowerment as a managerial approach and a theoretical construct, respectively. Moreover, these studies have analyzed the impact of employee empowerment practices on turnover as a binary outcome, to leave or to stay (e.g., Arthur, 1994; Gardner et al., 2011). They have not examined the impact of employee empowerment on a range of turnover options in the public sector, including transferring to another public organization, leaving the public sector, and retiring.

In this study, we develop a theoretical model of how employee empowerment influences turnover intention in the U.S. federal bureaucracy. Employee empowerment is conceptualized as a multifaceted managerial approach (see Bowen & Lawler, 1992, 1995). Turnover intention is operationalized as a binary outcome as well as a nominal one to account for intention to stay, to leave to another federal agency, to leave the federal government to seek work elsewhere, and to retire. The model is tested using structural equation modeling (SEM) and data from the U.S. Federal Employee Viewpoint Survey (FEVS). The empirical results support the hypothesized model. Employee empowerment has negative direct and indirect effects on turnover intention. The negative impact is greater on the likelihood of intention to leave to another federal agency and intention to leave the federal government than on the intention to retire.

Employee Empowerment

Employee empowerment has been viewed both as a cognitive state and a managerial approach. From a psychological perspective, employee empowerment is a state of mind in which someone believes strongly in his or her ability to perform a task (Conger & Kanungo, 1988) or experiences a heightened level of intrinsic task motivation (Thomas & Velthouse, 1990). Spreitzer (1995) described employee empowerment as a four-dimensional motivational construct composed of four cognitions—meaning, competence, self-determination, and impact—that reflect an active rather than passive orientation toward work. Alternatively, from a managerial perspective, employee empowerment describes managerial behavior or practices aimed at sharing information, resources, rewards, and authority with lower level employees. For instance, Kanter (1979) viewed empowerment as a process by which managers provide employees with access to three sources of power: supply of essential resources, information and feedback, and support and authority to act. Arnold, Arad, Rhoades, and Drasgow (2000) and Ahearne, Mathieu, and Rapp (2005) define employee empowerment as a leadership style or approach. For Arnold et al., an empowering leadership style involves behaviors that enhance the meaningfulness of work, foster participation in decision making, express confidence in high performance, and provide autonomy from bureaucratic constraints. For Ahearne et al., empowering leadership entails leading by example, involving others in decision making, coaching, informing, and showing concern for others.

One of the most well-known conceptualizations of employee empowerment is that developed by Bowen and Lawler (1992, 1995). They view employee empowerment as a multifaceted approach to service delivery in which managers share with their employees four organizational ingredients: “(1) information about the organization’s performance, (2) rewards based on the organization’s performance, (3) knowledge that enables employees to understand and contribute to organizational performance, and (4) power to make decisions that influence organizational direction and performance” (Bowen & Lawler, 1992, p. 32). We chose this conceptualization of employee empowerment for several reasons. Doing so allows us to compare our results to a growing body of research on employee empowerment as a managerial approach or set of practices (e.g., Arthur, 1994; Fernandez & Moldogaziev, 2013a, 2013b; Gardner et al., 2011; Grissom, 2012; Kim, 2002; H. Lee et al., 2006; Moynihan & Landuyt, 2008; Perry, 2004; Wright & Kim, 2004). In addition, the concept of employee empowerment as a managerial approach (see Bowen & Lawler, 1992, 1995, also see Ahearne et al., 2005; Arnold et al., 2000; Gardner et al., 2011) resonates with normative theory in public administration calling for humanism and democratization of the workplace (Denhardt, 1984). Golembiewski (1967, 1972) argued that practices and policies that enhance self-determination, personal growth, and sharing of information serve to improve job satisfaction and performance as well as promote a Judeo–Christian ethic in the workplace. Kirkhart (1971), a contributor to the first Minnowbrook Conference, stressed the need for public sector leaders to distribute power more evenly within hierarchies and encourage employee participation in decision making. Finally, this conceptualization of employee empowerment points to a set of familiar practices or interventions used by managers today (e.g., feedback, training, and delegation). Importantly, such practices have been found to be antecedents of psychological empowerment (Spreitzer, 1995), demonstrating the connection between managerial and psychological conceptualizations of this construct.

Theoretical Model

In this section, we develop a theoretical model of how employee empowerment impacts turnover intention. We propose that the effect of employee empowerment on turnover intention is mostly indirect and mediated by job satisfaction. Each of the links in this hypothesized causal structure is described below.

Scholars have devoted considerable time studying how to reduce turnover. Research has identified a number of antecedents of turnover, including personal characteristics like employee age and length of employment (Cotton & Tuttle, 1986; Griffeth, Hom, & Gaertner, 2000; Kellough & Osuna, 1995) and employee attitudes toward work, including organizational commitment, job involvement, and satisfaction with work, pay, benefits, and promotional opportunities (Bertelli, 2007; Cotton & Tuttle, 1986; Griffeth et al., 2000; Guthrie, 2001; Kim, 2005; Shaw, Delery, Jenkins, & Gupta, 1998). Employees with more favorable attitudes toward their job and work have stronger affective ties to their organization, feel a greater sense of belonging, and are therefore less likely to seek work elsewhere.

A range of managerial practices and policies have also been found to be effective at reducing turnover, including fostering open communication, enriching jobs, promoting fairness, instilling identification with the organization, and supporting family life (Cho & Lewis, 2012; Cotton & Tuttle 1986; Griffeth et al., 2000; Moynihan & Landuyt, 2008; Selden & Moynihan, 2000). Such practices make work more fulfilling and promote interpersonal trust, thereby leading to positive affective responses to work and organizations. Voluntary turnover theories and empirical tests indicate that employee attitudes are influenced by the kinds of practices and policies just mentioned and that they act as the primary antecedents of turnover intention and actual turnover decisions (T. W. Lee & Mowday, 1987; Michaels & Spector, 1982; Steers & Mowday, 1981).

Employee Empowerment and Job Satisfaction

Bowen and Lawler (1992, 1995) argued that employee empowerment improves job satisfaction by giving employees a sense of control and making work more meaningful. Empirical evidence from manufacturing, health care, basic and higher education, and other service industries corroborates this proposition (Fulford & Enz, 1995; Lawler et al., 1995; Wu & Short, 1996). These results are consistent with those from large meta-analyses showing that practices aimed at providing feedback and granting autonomy are positively related to job satisfaction (Fried & Ferris, 1987; Kinicki, McKee-Ryan, Schriesheim, & Carson, 2002). Studies from the public sector also reveal a positive relationship between employee empowerment practices and job satisfaction (Kim, 2002; H. Lee et al., 2006; Wright & Kim, 2004).

Self-Determination Theory (SDT) offers insight into how employee empowerment positively impacts job satisfaction (Deci & Ryan, 1985; Ryan, 1995; Ryan & Deci, 2000). SDT posits that people have an innate tendency toward growth and intrinsic motivation, which necessitates satisfaction of the three psychological needs for relatedness, competence, and autonomy (Deci & Ryan, 1985; Gagne & Deci, 2005; Ryan, 1995; Ryan & Deci, 2000). In many social settings, external regulations or stimuli are used to induce desired behavior. To the extent that the needs for relatedness, competence, and autonomy are satisfied, people internalize and integrate external regulations. Through this process of internalization and integration, extrinsically prescribed behavior becomes internally or autonomously regulated and motivation becomes self-determined.

Organizational policies, supervisory styles, and other managerial interventions that promote satisfaction of the needs for autonomy, competence, and relatedness have been found to positively influence work-related attitudes, including organizational commitment (Gagne & Koestner, 2002), commitment to change (Gagne, Koestner, & Zuckerman, 2000), work engagement (Deci et al., 2001), task enjoyment (Black & Deci, 2000), and job satisfaction (Deci, Connell, & Ryan, 1989; Ilardi, Leone, Kasser, & Ryan, 1993; Vansteenkiste et al., 2007). Ilardi et al. (1993) found that employees who felt strongly that their work allowed them to experience autonomy, competence, and relatedness reported higher levels of job satisfaction. The findings from Deci et al. (1989) indicate that a managerial orientation that promotes self-determination positively influences general work satisfaction. Vansteenkiste et al.’s (2007) findings indicate that employees who experience working conditions that promote intrinsic (vs. extrinsic) motivation are more satisfied with their job and life than others.

Managerial practices and behavior that promote self-determination, including empowerment practices like granting employees more discretion and providing them with the feedback and skills needed to perform their jobs, may increase job satisfaction in different ways. They may increase employees’ trust and feelings of psychological safety, thereby encouraging employees to satisfy their own needs at work (Deci et al., 1989). They may also promote job satisfaction by making employees feel they have more control over their work, an important correlate of job satisfaction (Spector, 1986). In addition, managerial interventions that provide greater autonomy and feedback may increase job satisfaction by making work more meaningful and intrinsically satisfying (Fried & Ferris, 1987; Hackman & Oldham, 1976). Finally, efforts to promote self-determination in the workplace may increase employees’ self-esteem (Deci et al., 1989; Ilardi et al., 1993), an important antecedent of job satisfaction (Judge, Locke, & Durham, 1997). To be sure, not every one of Bowen and Lawler’s empowerment practices is likely to have a positive effect on job satisfaction. In particular, the practice of offering tangible rewards linked to behavior is considered to undermine the need for autonomy and lead to a more externally perceived locus of causality, thereby reducing intrinsic motivation and satisfaction (Deci, Koestner, & Ryan, 1999). However, we expect the positive effects of the other three empowerment practices to outweigh this potentially negative one. Hence, our first hypothesis:

Hypothesis 1 (H1): Employee empowerment will have a positive effect on job satisfaction.

We note that another potential mediator of the relationship between employee empowerment and turnover is organizational commitment. Several empirical studies have examined the mediating role of organizational commitment, most focusing on affective commitment. They have found that employee empowerment reduces turnover intention and actual turnover by enhancing individuals’ commitment to the organization (Arthur, 1994; Gardner et al., 2011; Paré & Tremblay, 2007). Employee empowerment increases organizational commitment because empowered employees believe that their contributions are more valued and supported by the organization and the organization makes greater investments in having them involved. They are more likely to be emotionally attached to the organization, feel a sense of belonging, and identify with the organization’s goals and values. Drawing on SDT, Gardner et al. (2011) argued that empowerment practices satisfy employees’ needs for autonomy, competence, and relatedness and lead to feelings of organizational belonging and increased commitment. Employees with a strong commitment help their organization achieve its goals and take actions that are beneficial to the organization. They wish to continue their employment with the current organization, and therefore, organizational commitment reduces employee turnover (Griffeth et al., 2000; Mathieu & Zajac, 1990; Tett & Meyer, 1993). While data limitations prevent us from estimating the indirect effect of employee empowerment on turnover intention as mediated by organizational commitment, we use an alternative approach to deal with this potential mediator.

Job Satisfaction and Turnover

Employee satisfaction has been a prevailing theme in research on employee turnover. Dissatisfaction with certain facets of work, including pay (Cotton & Tuttle, 1986; Shaw et al., 1998), fringe benefits (Ippolito, 1987; Shaw et al., 1998), and growth and promotional opportunities (Cotton & Tuttle, 1986; Griffeth et al., 2000), has been found to increase the likelihood of turnover. A large body of empirical research also points to a consistent and inverse relationship between job satisfaction and turnover (Carsten & Spector, 1987; Cotton & Tuttle, 1986; Porter, Steers, Mowday, & Boulian, 1974), with job satisfaction typically defined as a general feeling or attitude toward one’s job rather than toward a particular facet of a job.

Voluntary turnover research points to job satisfaction as a key predictor of turnover intention, which in turn leads to actually leaving an organization, and shows that job satisfaction has consistently negative effects on turnover intention and actual turnover. Employee turnover occurs in response to dissatisfaction with one’s job (Mobley, 1977; Porter & Steers, 1973). That is, when employees experience unfavorable work situations and are dissatisfied with their job, they are likely to think of quitting, reduce their contributions, and seek employment elsewhere. Job satisfaction is considered an immediate antecedent to an individual’s intention to leave (Steers & Mowday, 1981), and empirical tests of turnover models also suggest that job satisfaction has a direct and negative effect on turnover intention (T. W. Lee & Mowday, 1987; Michaels & Spector, 1982). Meta-analytic studies provide further support for the relationship between job satisfaction and turnover intention (Griffeth et al., 2000; Tett & Meyer, 1993).

Turnover intention is usually studied as a simple binary variable that indicates either intending to leave the organization or to stay. However, employees may express different kinds of turnover intention. In the federal government, for example, employees have multiple options when it comes to leaving: they may choose to retire, to leave to another federal agency, or to leave the federal government (to work in state or local governments, nonprofits, or business organizations); state and local government employees have the same or similar turnover options. As all of these turnover options are considered a form of leaving a current organization, we hypothesize that job satisfaction will be negatively related to turnover intention regardless of the reasons for leaving. However, it is also quite possible that the effects of job satisfaction vary in magnitude based on the kind of turnover intention being expressed. For example, Whitford and Lee (2015) found that employee loyalty, voice, and other attitudes toward work influence the likelihood of exit or turnover intention. However, the impact of loyalty and voice varied by exit option (retire, transfer to another federal agency, or leave for a job outside of the federal government). Thus, we also analyze the impact of job satisfaction on the likelihood of someone expressing his or her intention to leave to another federal agency, to leave the federal government, and to retire, versus to stay.

Hypothesis 2 (H2): Job satisfaction will have a negative effect on turnover intention.

Data and Method

In this section, we describe the data, variables, measures, and methods used in the empirical analysis.

Data

Data for the empirical analysis were drawn from 2011 FEVS. This survey was conducted by the U.S. Office of Personnel Management (OPM) and was administered to 540,727 federal government employees working in cabinet level and independent agencies. Among them, 266,376 employees completed the survey, yielding a response rate of 49.3%. Due to missing data on one or more variables, the final sample size was reduced to 200,055. There were no meaningful differences between those observations that were included in the final sample and those that were dropped due to missing data.

Variables

The variables in the analysis are employee empowerment, job satisfaction, and turnover intention. Employee empowerment and job satisfaction are treated as latent variables in our structural equation models because they are unobservable constructs that are measured using multiple observable indicators. Turnover intention is measured using a single item and treated as an observable indicator.

The latent variable employee empowerment represents a multifaceted managerial approach composed of four practices: providing information about goals and performance (observable variable Practice 1), offering rewards based on performance (observable variable Practice 2), providing access to job-related knowledge and skills (observable variable Practice 3), and granting discretion to change work processes (observable variable Practice 4; Bowen & Lawler, 1992, 1995). It is measured using four summated rating scales, one for each practice, that are created from multiple survey items (see the appendix for variables and measures). The Cronbach’s alphas for these scales range from .75 for Practice 3 to .87 for Practice 2. Previous work using higher order confirmatory factor analysis (CFA) and the method developed by Fornell and Larcker (1981) offers evidence of both convergent and discriminant validity for this four-dimensional measure of employee empowerment (Fernandez & Moldogaziev, 2013b).

The latent variable job satisfaction represents the cognitive and affective response to one’s job. It is measured using two survey items (observable measures Job Satisfaction 1 and Job Satisfaction 2) that represent global measures of overall job satisfaction rather than measures of satisfaction with facets of a job such as pay, promotion, benefits, and supervision. Global and faceted measures of job satisfaction do not correlate very strongly, leading some to argue that they are not measuring the same construct, or that the whole is not the sum of its parts (Scarpello & Campbell, 1983). We follow Judge and Church’s (2000) lead and use a two-item rather than single-item global measure of job satisfaction, as the former tends to be somewhat more reliable.

The observable variable turnover intention is measured using one survey item in which respondents are asked if they are considering leaving their organization during the next year. Response categories include “No,” “Yes, to retire,” “Yes, to take another job within the federal government,” “Yes, to take another job outside the federal government,” and “Yes, other.” In the 2011 FEVS, 71.6% of the respondents stated they were not considering leaving their organization, 6.6% were considering leaving to retire, 15.3% to take another job within the federal government, 3.0% to take another job outside the federal government, and 3.5% for other reasons.

In our structural equation models, turnover intention is operationalized in two ways, as a binary variable and as a nominal variable to account for the likelihood of different types of turnover intention. First, to capture the overall intent to voluntarily leave the organization, the responses are coded 1 for “Yes, to retire”; “Yes, to take another job within the federal government”; “Yes, to take another job outside the federal government”; and “Yes, other.” “No” is coded 0. Employees who express a desire to take another job within the federal government may have different motives from those wanting to leave the federal service altogether. From the perspective of an agency, however, both scenarios signal the likely voluntary departure of an employee and have similar adverse consequences. Thus, we include both responses in our first operationalization of turnover intention.

We also operationalize turnover intention as a nominal variable with four distinct response categories: intention to stay (“No”), intention to retire (“Yes, to retire”), intention to leave to another federal agency (“Yes, to take another job within the federal government”), and intention to leave the federal government (“Yes, to take another job outside the federal government”). The “Yes, other” category is omitted because it does not indicate a particular reason for leaving and its meaning is ambiguous.

The pattern of correlations in Table 1 offers evidence of convergent and discriminant validity for the variables in the analysis, with all correlations being in the predicted direction. As expected, employee empowerment has a stronger correlation with job satisfaction (r = .65) than with turnover intention (r = −.33). The correlation between job satisfaction and turnover intention (r = −.36) is somewhat stronger than the latter’s correlation with employee empowerment (r = −.33).

Table 1.

Descriptive Statistics and Correlation Matrix.

	M	SD	Minimum	Maximum	1	2	3
1. Employee empowerment	3.46	0.83	1	5	1.00
2. Job satisfaction	4.04	0.81	1	5	.65	1.00
3. Turnover intention	0.28	0.45	0	1	−.33	−.36	1.00

Note. Employee empowerment and job satisfaction are measured using summated rating scales, and turnover intention is measured using a single item (see the appendix).

Modeling

A series of structural equation models are developed and tested using Mplus 7. In our models, the indicators for the latent variable job satisfaction and the observable indicator turnover intention are categorical. For the first model with a binary turnover intention variable, we use a robust weighted least squares mean- and variance-adjusted (WLSMV) estimator. The WLSMV estimator uses a diagonal weight matrix with robust standard errors and a robust mean- and variance-adjusted chi-square test statistic; it is the default estimator in Mplus for models with at least one binary or ordered categorical dependent variable (Muthén & Muthén, 1998-2012). The WLSMV estimator provides superior model fit and more precise path coefficients than does the maximum likelihood (ML) estimator, especially when the number of categories is low (e.g., two or three; Beauducel & Herzberg, 2006). Alternatively, the ML estimator with the logit link is used for the multinomial logit model with a nominal turnover intention variable that has four response categories. The regression coefficients for binary dependent variables with the WLSMV estimator are probit coefficients, whereas those for nominal dependent variables with the ML estimator are logit coefficients.

Results

We begin by focusing on a probit model with turnover intention operationalized as a binary variable (Model 1; see Figure 1 and Table 2). Although we hypothesized, based on theory and previous research, that the relationship between employee empowerment and turnover intention is mediated by job satisfaction, we tested alternate models with and without a direct path from employee empowerment to turnover intention to see which model fits the data better. The following two models are estimated: one with the direct path (χ² = 3,621.601, df = 12, root mean square error of approximation [RMSEA] = 0.039, comparative fit index [CFI] = 0.993, Tucker–Lewis index [TLI] = 0.987) and the other without the direct path (χ² = 4,622.292, df = 13, RMSEA = 0.042, CFI = 0.991, TLI = 0.985). The chi-square difference test is conducted using the “difftest” option in Mplus and indicates that the model with the direct path has a somewhat better fit than the model without the path (Δχ² = 810.320, Δdf = 1, p < .001). Other fit statistics also suggest the model with the direct path fits slightly better. Thus, we conclude that employee empowerment has a direct effect on turnover intention as well as an indirect effect through its influence on job satisfaction. The fit statistics show that our final model (Model 1), which includes the direct path from employee empowerment to turnover intention, fits the data well. CFI and TLI are greater than 0.95, which are indicative of good fit (Hu & Bentler, 1999). RMSEA is smaller than 0.05, also suggesting good model fit (Browne & Cudeck, 1993).

Figure 1.

Results from Probit Structural Equation Model of Employee Empowerment, Job Satisfaction, and Turnover Intention (Model 1).

Table 2.

Parameter Estimates for Probit Structural Equation Model (Model 1).

Parameter	Unstandardized coefficient	SE	Standardized coefficient
Factor loadings
Employee empowerment → Practice 1	1.00^a		0.87***
Employee empowerment → Practice 2	1.02***	0.00	0.80***
Employee empowerment → Practice 3	0.93***	0.00	0.88***
Employee empowerment → Practice 4	1.12***	0.00	0.89***
Job satisfaction → Job Satisfaction 1	1.00^a		0.62***
Job satisfaction → Job Satisfaction 2	1.67***	0.01	1.04***
Direct effects
Employee empowerment → Job satisfaction	0.62***	0.00	0.77***
Employee empowerment → Turnover intention	−0.19***	0.01	−0.15***
Job satisfaction → Turnover intention	−0.61***	0.01	−0.38***
Measurement error variances
Practice 1	0.20***	0.00	0.25***
Practice 2	0.34***	0.00	0.35***
Practice 3	0.16***	0.00	0.23***
Practice 4	0.20***	0.00	0.21***
Disturbance variances
Job satisfaction	0.16***	0.00	0.41***

The parameter is fixed and not tested.

***

p < .001.

In Model 1, the effect of employee empowerment on job satisfaction is positive and significant (b = 0.62, p < .001). This lends support to H1. The relationship between job satisfaction and turnover intention is negative and significant (b = −0.61, p < .001). This offers support for H2. The indirect effect of employee empowerment on turnover intention via job satisfaction is tested using the bootstrapped confidence intervals (CIs). The indirect effect is negative (b = −0.38) and the 99% CI = [−0.39, −0.36] suggests that it is statistically significant. The direct effect of employee empowerment on turnover intention is negative and significant (b = −0.19, p < .001), but it is noticeably smaller than the indirect effect through job satisfaction, providing support for the mediating role of job satisfaction. As the direct path from employee empowerment to turnover intention may also be picking up other mediating effects not included in the model, these results suggest that any mediating influence of organizational commitment is significantly weaker than the mediating influence of job satisfaction in the relationship between employee empowerment and turnover intention.

To check the robustness of the results from Model 1, we modified the binary operationalization of turnover intention by coding responses “Yes, to retire” as 0. The new results are generally consistent with those obtained when “Yes, to retire” is coded 1, except that the effect of job satisfaction on turnover intention gets slightly stronger when turnover intention does not include intent to retire (b = −0.68, p < .001). In addition, we tested Model 1 using data from the 2006 and 2008 Federal Human Capital Survey (FHCS) and the 2010 FEVS and find that the additional results are generally consistent with those obtained using 2011 FEVS data.

For an additional robustness check, we examined whether the results from Model 1 are consistent across 41 federal agencies. There are 42 additional agencies that participated in the 2011 FEVS, but they are smaller and did not have sufficient respondents to estimate a SEM model. Using a multiple group analysis, we tested equality constraints on the three causal paths (from employee empowerment to job satisfaction, from employee empowerment to turnover intention, and from job satisfaction to turnover intention) across the 41 agencies. The following two models are estimated: one with the equality constraints (χ² = 7,408.195, df = 1092, RMSEA = 0.034, CFI = 0.987, TLI = 0.990) and the other in which the three causal paths are allowed to vary across agencies (χ² = 8,218.356, df = 972, RMSEA = 0.039, CFI = 0.985, TLI = 0.987). The chi-square difference test indicates that the model without the equality constraints fits better (Δχ² = 757.023, Δdf = 120, p < .001), whereas other fit statistics such as RMSEA, CFI, and TLI show that the model with the equality constraints has a slightly better fit. Even when the path coefficients are allowed to vary freely, however, the results are generally consistent across the 41 agencies. Nevertheless, there is some variation in terms of magnitude of the effect. The effect of employee empowerment on job satisfaction is positive for all 41 agencies (M = 0.65), with a range from 0.54 (Broadcasting Board of Governors) to 0.79 (Department of Defense). The relationship between job satisfaction and turnover intention is always negative across the 41 agencies (M = −0.60), ranging from −0.88 (Broadcasting Board of Governors) to −0.17 (Railroad Retirement Board). And the direct effect of employee empowerment on turnover intention is always negative—or in a handful of cases zero—across the 41 agencies (M = −0.19), with a range from −0.65 (National Gallery of Art) to 0 (Federal Energy Regulatory Commission).

We conducted another set of multiple group analyses for age groups and supervisory levels. Equality constraints on the causal paths are tested across three age groups (age 29 and under; 30-49; and 50 or older) and three supervisory levels (nonsupervisors/team leaders, supervisors, and managers/executives). All of the fit statistics and the chi-square difference tests indicate that the equality constraints do not hold across age groups or supervisor levels. Although the results do not vary greatly among age groups or supervisory levels, we find some interesting patterns. For age groups, people at age 50 or older have a somewhat weaker relationship between job satisfaction and turnover intention compared with those who are younger (b = −0.72, p < .001, for age 29 and under; b = −0.77, p < .001, for age 30-49; b = −0.57, p < .001, for age 50 or older). Also, the negative effect of employee empowerment on turnover intention gets weaker as age increases (b = −0.32, p < .001, for age 29 and under; b = −0.23, p < .001, for age 30-49; b = −0.12, p < .001, for age 50 or older). These results suggest that as federal employees get older, factors like retirement eligibility and retirement finances have a greater influence on the decision to turnover than satisfaction with work or the influence of employee empowerment.

For supervisory levels, however, the positive effect of employee empowerment on job satisfaction gets stronger for higher level employees (b = 0.56, p < .001, for nonsupervisors/team leaders; b = 0.63, p < .001, for supervisors; b = 0.72, p < .001, for managers/executives). Differences in how public managers and their subordinates perceive the public sector workplace may account for this pattern. People who work in the public sector often face greater constraints and enjoy less autonomy and flexibility than their private sector counterparts, and these differences appear to become more acute at managerial and supervisory levels than on the frontline (Rainey, 2014). Employee empowerment may be more effective at removing these constraints and increasing autonomy for those at higher levels of the hierarchy than lower level employees. As a result, employee empowerment has a greater impact on job satisfaction among supervisors and managers than rank-and-file employees.

The discussion now turns to the results from the multinomial logit model with turnover intention operationalized as a nominal variable with four distinct response categories (Model 2; see Figure 2 and Table 3). The response categories are intention to stay, intention to retire, intention to leave to another federal agency, and intention to leave the federal government; the first response category, intention to stay, is used as a base category for comparison. The results are consistent with our previous findings. The relationship between employee empowerment and job satisfaction is positive and significant (b = 1.30, p < .001). The effect of job satisfaction on turnover intention is negative and significant for all turnover intention categories compared with the intention to stay, which means that those who are more satisfied with their job are significantly less likely to report their intention to retire, to leave to another federal agency, or to leave for a job outside the federal government. These results provide further support to H1 and H2. The variable job satisfaction has a significantly larger negative effect on the likelihood of intention to leave the federal government (b = −0.75, p < .001) and to leave to another federal agency (b = −0.63, p < .001), compared with intention to stay, than on the likelihood of intention to retire (b = −0.23, p < .001), compared with intention to stay. In addition, we find that the direct effect of employee empowerment on turnover intention is negative and significant for all turnover intention categories compared to the intention to stay. The variable employee empowerment has a noticeably larger negative effect on the likelihood of intention to leave the federal government (b = −0.37, p < .001) and to leave to another federal agency (b = −0.53, p < .001), compared with intention to stay, than on the likelihood of intention to retire (b = −0.15, p < .001), compared with intention to stay.

Figure 2.

Results from Multinomial Logit Structural Equation Model of Employee Empowerment, Job Satisfaction, and Turnover Intention (Model 2).

Table 3.

Parameter Estimates for Multinomial Logit Structural Equation Model (Model 2).

Parameter	Unstandardized coefficient	SE	Standardized coefficient
Factor loadings
Employee empowerment → Practice 1	1.00^a		0.88***
Employee empowerment → Practice 2	1.01***	0.00	0.82***
Employee empowerment → Practice 3	0.90***	0.00	0.87***
Employee empowerment → Practice 4	1.05***	0.00	0.87***
Job satisfaction → Job Satisfaction 1	1.00^a		0.61***
Job satisfaction → Job Satisfaction 2	174.45***	16.46	1.00***
Direct effects
Employee empowerment → Job satisfaction	1.30***	0.00	0.74***
Employee empowerment → Intention to leave the federal government^b	−0.37***	0.03	−0.23***
Employee empowerment → Intention to leave to another federal agency^b	−0.53***	0.01	−0.35***
Employee empowerment → Intention to retire^b	−0.15***	0.02	−0.28***
Job satisfaction → Intention to leave the federal government^b	−0.75***	0.02	−0.82***
Job satisfaction → Intention to leave to another federal agency^b	−0.63***	0.01	−0.71***
Job satisfaction → Intention to retire^b	−0.23***	0.01	−0.78***
Measurement error variances
Practice 1	0.19***	0.00	0.22***
Practice 2	0.33***	0.00	0.34***
Practice 3	0.17***	0.00	0.25***
Practice 4	0.24***	0.00	0.25***
Disturbance variances
Job satisfaction	0.91***	0.00	0.46***

The parameter is fixed and not tested.

Base category = intention to stay.

***

p < .001.

Discussion and Conclusion

In this study, we tested a theoretical model of how employee empowerment impacts turnover intention in the U.S. federal bureaucracy. The results of the empirical analysis offer significant support for the proposed model. Specifically, we find that employee empowerment has a positive and substantively meaningful effect on job satisfaction, which in turn has a negative and substantively meaningful effect on turnover intention. Thus, the relationship between employee empowerment and turnover intention is negative and mediated by job satisfaction. We also find that employee empowerment has a direct negative effect on turnover intention but the direct effect is not as strong as the indirect effect via job satisfaction.

Scholars have pointed to other variables in addition to job satisfaction that could mediate the relationship between employee empowerment and turnover intention. For example, Steers and Mowday (1981) propose that employee attitudes such as organizational commitment and job involvement serve as immediate antecedents of turnover intention. By testing the direct path from employee empowerment to turnover intention, we also intended to capture the potential effects of these alternative mediators. The finding that the indirect effect via job satisfaction is significantly stronger than the direct effect suggests that job satisfaction is the most important single variable that mediates the relationship between employee empowerment and turnover intention.

Unlike previous research on employee empowerment and turnover in the public sector, our findings suggest that not just one element of empowerment (e.g., discretion or involvement in decision) but employee empowerment as a multifaceted managerial intervention can reduce intention to leave the federal bureaucracy. Our findings are also unique in that they suggest that the impact of employee empowerment on turnover intention differs by type of turnover intention. Previous studies of employee empowerment in the public sector combined different forms of turnover intention, thereby concealing the differential effects of employee empowerment on intention to transfer within the federal government, leave for a job in another sector, or retire. In our analysis, we find that employee empowerment has stronger direct as well as indirect effects on the intention to leave an organization either to another federal agency or for a job outside the federal government than on the intention to retire. These results suggest the need to look at quitting an organization and retiring as distinct forms of turnover. Conceptually, intending to leave an agency or the federal government to take another job implies continued employment elsewhere whereas intending to retire generally involves decreased commitment to workforce participation and is often followed by discontinuation of regular employment (Feldman, 1994). Also, empirical research on organizational withdrawal reports that quit and retirement intentions have several unique predictors (Adams & Beehr, 1998; Schmidt & Lee, 2008). Intention to quit an organization is more likely to be influenced by work-related factors including organizational and job characteristics, managerial practices, employment relations, and job attitudes. However, intention to retire might be more closely related to lifestyle choices and other nonwork variables such as retirement finances, commitment to family and leisure, health status, and age. Thus, the effects of employee empowerment and of job satisfaction on turnover intention are weaker for retirement intention than for the intention to quit and seek work elsewhere.

A limitation of SEM is that the complexity of the statistical modeling often prevents the researcher from controlling for covariates beyond the variables of primary interest. As many equations in the measurement and structural models are estimated simultaneously, adding just a few control variables can increase complexity to the point where SEM no longer converges to produce a unique solution. This is more likely to occur when there is a degrees of freedom problem and/or when insufficient covariance information is available to compute valid estimates. In our SEM analysis, we were able to statistically control for several variables such as work location, age, gender, minority status, supervisory level, and tenure and found that the results remained the same while the model fit became worse. Thus, we left these variables out of the models reported above.

Relying on the 2011 FEVS as the only source of data for our analysis raises the issue of common method variance or monomethod bias. Common method variance is believed to produce artificially inflated correlations (Crampton & Wagner, 1994; Podsakoff, MacKenzie, Lee, & Podsakoff, 2003), although in some cases the bias can also deflate correlations (Cote & Buckley, 1988; Williams & Brown, 1994). Crampton and Wagner (1994) conclude that while one should be cognizant of the potential for common method variance, researchers have overstated the magnitude of this problem. Spector (2006) has gone as far as calling common method bias an urban legend, a distortion and oversimplification that is not supported by empirical evidence, as his analysis shows.

We probed our data by performing a Harman’s single factor test, a commonly used but fairly weak diagnostic test to detect common method bias. The test produced a multifactor solution, thus failing to find glaring evidence of common method variance. Evidence of discriminant validity provides stronger evidence against the presence of common method variance. The variables employee empowerment and turnover intention are correlated at just r = −.33. More important, application of the Fornell and Larcker (1981) method offers evidence of discriminant validity among measures representing the four underlying dimensions of employee empowerment. These four dimensions are strongly correlated as they converge on a higher order construct. Had common method variance been significant, it would have inflated these strong correlations even further, making it very unlikely that we would find evidence of discriminant validity. Finally, we note that nearly all of the survey items used in our analysis measure prevailing practices and policies in federal agencies as observed by survey respondents and not their own particular behavior. These more objective assessments of conditions within organizations should be less susceptible to common method variance than self-reported data on employee behavior. In short, we have reason to believe common method variance is not a serious problem in this study. Nevertheless, care should be taken in interpreting the results.

We conclude by discussing the findings’ implications for policy and practice. The United States is witnessing unprecedented levels of distrust in public institutions. Given recent scandals and management failures in the U.S. Veterans Administration, the Department of Health and Human Services, and elsewhere, the federal bureaucracy is unlikely to escape the public’s scorn. This does not bode well for retention of skilled and experienced federal employees who become increasingly dissatisfied with public service. Widespread antibureaucratic sentiment puts citizens in a quandary. It can undermine the morale of public employees, lead to loss of human capital in the public sector, and give rise to further performance problems that were the source of dissatisfaction and distrust of the bureaucracy in the first place. Now more than ever, retention of scarce human talent has become imperative for an effective federal bureaucracy, especially in light of improvements in the labor market and growing competition from the private sector to attract the best and brightest in the federal workforce. Previous research points to a range of managerial practices and policies that are negatively related to turnover. Our study indicates that multifaceted employee empowerment programs aimed at sharing information, resources, rewards, and authority with lower level employees can be added to the arsenal of weapons used by federal executives and managers to mitigate turnover and its negative consequences. FHCS/FEVS data show widespread use of employee empowerment practices across federal agencies since 2002. These are fairly common managerial practices that can be readily observed, emulated, and disseminated further with modest effort and without the added costs of additional reforms. Moreover, adoption of employee empowerment practices, in addition to reducing turnover, can improve flexibility, performance, and innovativeness. Rarely has a managerial intervention offered so much leverage to improve management and performance in the public sector.

Footnotes

Appendix

FHCS/FEVS Variables and Measures

Employee empowerment

Practice 1 (providing information about goals and performance)

• Managers review and evaluate the organization’s progress toward meeting its goals and objectives. (1 = strongly disagree to 5 = strongly agree)

• Supervisors/team leaders provide employees with constructive suggestions to improve their job performance. (1 = strongly disagree to 5 = strongly agree)

• How satisfied are you with the information you receive from management on what is going on in your organization? (1 = very dissatisfied to 5 = very satisfied)

Practice 2 (offering rewards based on performance)

• Promotions in my work unit are based on merit. (1 = strongly disagree to 5 = strongly agree)

• Employees are rewarded for providing high-quality products and services to customers. (1 = strongly disagree to 5 = strongly agree)

Pay raises depend on how well employees perform their jobs. (1 = strongly disagree to 5 = strongly agree)

• Awards in my work unit depend on how well employees perform their jobs. (1 = strongly disagree to 5 = strongly agree)

Practice 3 (providing access to job-related knowledge and skills)

• I am given a real opportunity to improve my skills in my organization. (1 = strongly disagree to 5 = strongly agree)

• The workforce has the job-relevant knowledge and skills necessary to accomplish organizational goals. (1 = strongly disagree to 5 = strongly agree)

• Supervisors/team leaders in my work unit support employee development. (1 = strongly disagree to 5 = strongly agree)

Practice 4 (granting discretion to change work processes)

• Employees have a feeling of personal empowerment with respect to work processes. (1 = strongly disagree to 5 = strongly agree)

• How satisfied are you with your involvement in decisions that affect your work? (1 = very dissatisfied to 5 = very satisfied)

Job satisfaction

Job Satisfaction 1

• I like the kind of work I do. (1 = strongly disagree to 5 = strongly agree)

Job Satisfaction 2

• Considering everything, how satisfied are you with your job? (1 = very dissatisfied to 5 = very satisfied)

Turnover intention

• Are you considering leaving your organization within the next year, and if so, why? (0 = No; 1 = Yes, to retire; Yes, to take another job within the federal government; Yes, to take another job outside the federal government; and Yes, other)

Note. FHCS = Federal Human Capital Survey; FEVS = Federal Employee Viewpoint Survey.

Declaration of Conflicting Interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The author(s) received no financial support for the research, authorship, and/or publication of this article.

Author Biographies

Sun Young Kim is a doctoral candidate in Indiana University School of Public and Environmental Affairs. Her research interests include employee empowerment, leadership, and behavioral ethics in public organizations.

Sergio Fernandez is Associate Professor and Director of the PhD in Public Affairs and Joint PhD in Public Policy Programs in Indiana University School of Public and Environmental Affairs. He is also a Research Associate in University of Johannesburg Center for Public Management and Governance. His research focuses on employee empowerment, representative bureaucracy, employee attitudes in the federal bureaucracy, and government outsourcing.

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