Flexible Working Hours and Employee Retention: Evidence from Employees in Karachi, Pakistan

Abstract

Employee retention remains one of the most persistent strategic challenges facing organisations in the twenty-first century, with voluntary turnover estimated to cost firms between 50% and 200% of a departing employee's annual salary once recruitment, onboarding, training, and lost-productivity effects are accounted for (SHRM, 2019). This study examines the relationship between flexible working hours and employee retention among 110 employees drawn from the information technology, finance, education, and customer service sectors in Karachi, Pakistan. Using a quantitative, cross-sectional, descriptive-correlational design, data were collected through a structured, pilot-tested questionnaire measuring flexible working hours and employee retention on five-point Likert scales. The instrument demonstrated good internal consistency (Cronbach's alpha = .84). Pearson product-moment correlation analysis revealed a strong, statistically significant, positive relationship between flexible working hours and employee retention (r = .74, p < .01), leading to rejection of the null hypothesis. Respondents further reported that flexibility improved perceived productivity, reduced stress, and strengthened organisational commitment, consistent with the theoretical expectations of Social Exchange Theory, Organisational Support Theory, Job Demands–Resources Theory, and Conservation of Resources Theory. The study extends a literature historically dominated by developed-economy samples into an under-represented developing-country context, and concludes with a  research model and questionnaire incorporating work-life balance, job satisfaction, and perceived organisational support as mediating mechanisms together with recommendations for more advanced analytical techniques (including PLS-SEM and mediation analysis) to guide future confirmatory research.