Employee Engagement as a Pathway to Employee Retention: The Role of Employee Well-being and Work-Life Balance in the Banking Sector
JEL Classification: M12; M51; J28; J63; G21
Abstract
Employee retention has become an important challenge in the banking industry amid digital transformation and changing workforce expectations. This study examines the effects of Employee Well-being and Work-Life Balance on Employee Retention through Employee Engagement among employees of BNI Makassar. A quantitative approach was employed using survey data collected from 148 employees selected from a population of 235 employees. Data were analyzed using Structural Equation Modeling–Partial Least Squares (SEM-PLS) with SmartPLS 4. The findings reveal that Employee Well-being and Work-Life Balance positively and significantly affect Employee Engagement and Employee Retention. Employee Engagement also has a significant positive effect on Employee Retention and partially mediates the relationships between Employee Well-being and Employee Retention as well as between Work-Life Balance and Employee Retention. Employee Well-being emerged as the strongest predictor of Employee Retention. These findings indicate that organizational efforts to improve employee welfare, create a supportive work environment, and promote work-life balance can strengthen employee engagement and enhance retention. The study contributes to the human resource management literature by providing empirical evidence on employee retention mechanisms in the banking sector and offers practical implications for developing sustainable human resource strategies.
References
Akbar, F. M., & Zona, M. A. (2025). The influence of work-life balance on employee well-being mediated by job stress: Pengaruh work-life balance terhadap employee well-being melalui stres kerja pada PT Bank Nagari. Santhet (Jurnal Sejarah Pendidikan dan Humaniora), 9(1), 84–93. https://doi.org/10.36526/santhet.v9i1.4982
Alhaider, M., & Alqahtani, A. (2026, May). Impact of work–life balance on organizational performance with mediating effect of well-being and organizational support as moderator. In Evidence-based HRM: A global forum for empirical scholarship (Vol. 14, No. 2, pp. 433-451). Emerald Publishing Limited. https://doi.org/10.1108/EBHRM-10-2024-0371
Aruldoss, A., Kowalski, K. B., & Parayitam, S. (2021). The relationship between quality of work life and work-life balance: Mediating role of job stress, job satisfaction and job commitment—Evidence from India. Journal of Advances in Management Research, 18(1), 36–62. https://doi.org/10.1108/JAMR-05-2020-0082
Bakker, A. B., & Demerouti, E. (2017). Job demands–resources theory: Taking stock and looking forward. Journal of Occupational Health Psychology, 22(3), 273–285. https://doi.org/10.1037/ocp0000056
Barreto, A., Hadikusumo, R. A., & Ruswandi, W. (2025). Digital Transformation as a Catalyst for Business Performance and Competitive Dynamics in Emerging Economies. The Journal of Academic Science, 2(4), 1228-1238. https://doi.org/10.59613/94rdhf18
Bhardwaj, S., Chopra, R., & Choudhary, P. (2025). Nurturing the roots of workplace flourishing: an in-depth exploration of employee well-being initiatives. International Journal of Organizational Analysis, 33(11), 4330-4359.
Bučiūnienė, I., & Goštautaitė, B. (2026). The role of sustainable HRM in mitigating the effects of the COVID-19 pandemic on employee well-being in education. International Journal of Public Administration, 49(1), 14-29. https://doi.org/10.1080/01900692.2025.2451386
Cosmulese, C. G., Zhavoronok, A., Greshko, R., Ostrovska, N., Kharabara, V., & Tkach, V. (2026). Fintech As A Factor Of Asymmetric Transformation Of The Banking Sector: European Experience And Potential For Ukraine. Journal Of Theoretical and Applied Information Technology, 104(2).
Desiana, P. M., Andrias, M. S., & Ahyinaa, G. S. (2024). The mediating effect of employee engagement and well-being on turnover intention in Indonesia. Problems and Perspectives in Management, 22(2), 477–487. https://doi.org/10.21511/ppm.22(2).2024.37
Duci, E., Tabaku, E., Kosova, R., & Lazaj, A. (2025). The evolution of technology in accounting and corporate finance: Implications for business adaptation and competitiveness. International Research Journal of Modernization in Engineering Technology and Science. https://www.doi.org/10.56726/IRJMETS66318
Efranto, R. Y., Sipayung, S. N., & Amrulloh, A. B. Y. (2026). Green human resource management: a decade of evolution in practices, employee green behavior, and organizational sustainability. Cogent Business & Management, 13(1), 2598686. https://doi.org/10.1080/23311975.2025.2598686
Fenech, R., Baguant, P., & Ivanov, D. (2019). The changing role of human resource management in an era of digital transformation. International Journal of Entrepreneurship, 22(2), 166-175. https://doi.org/10.5465/ame.1990.4274667
Gayathri, R. K., Vettriselvan, R., Rajesh, D., Balakrishnan, R., Kumar, R., & Kavitha, J. (2025). Strategic role of human resource management in enhancing occupational health and safety practices in business schools in India. Texila International Journal of Public Health, 13(2).
Giovanis, E., Özdamar, B., & Ozdamar, O. (2026). Managing digital work in the post-pandemic era: telework intensity, organisational support, and employee well-being. International Journal of Workplace Health Management, 1-22. https://doi.org/10.1108/IJWHM-09-2025-0245
Gunawan, W. B., & Mikhail, L. (2025). Strategic and sustainable human resource management: Twin weapon for achieving competitive advantage in organization. Priviet Social Sciences Journal, 5(6), 45-58. https://doi.org/10.55942/pssj.v5i6.401
Hair, J. F., Hult, G. T. M., Ringle, C. M., & Sarstedt, M. (2022). A primer on partial least squares structural equation modeling (PLS-SEM) (3rd ed.). Sage Publications.
Handoko, S., & Nugroho, A. (2024). Dampak work-life balance terhadap retensi karyawan melalui kepuasan kerja sebagai variabel mediasi. Jurnal Dinamika Ekonomi dan Bisnis, 21(2), 115–128.
Jameaba, M. S. (2024). Digitalization, emerging technologies, and financial stability: challenges and opportunities for the Indonesian banking sector and beyond. Emerging Technologies, and Financial Stability: Challenges and Opportunities for the Indonesian Banking Sector and Beyond (April 26, 2024).
Kyndt, E., Dochy, F., Michielsen, M., & Moeyaert, B. (2009). Employee retention: Organisational and personal perspectives. Vocations and Learning, 2(3), 195–215. https://doi.org/10.1007/s12186-009-9024-7
Menezes, D. B. S., Silva, R. M., & Pereira, A. C. (2025). The role of talent management in enhancing employee engagement and retention. Sustainability, 17(7), 3277. https://doi.org/10.3390/su17073277
Mueller, F. (1996). Human resources as strategic assets: an evolutionary resource‐based theory. Journal of Management studies, 33(6), 757-785.
Naimi-Sadigh, A., Asgari, T., & Rabiei, M. (2022). Digital transformation in the value chain disruption of banking services. Journal of the Knowledge Economy, 13(2), 1212-1242. https://doi.org/10.1007/s13132-021-00759-0
Nardi, F. R., & Wijaya, T. (2026). Improving Generation Z employee retention through work-life balance and employee engagement. Golden Ratio of Human Resource Management, 6(1), 45–61.
Noor, J., Hidayat, S., & Rahman, A. (2023). Human resource management practices on employee commitment in Islamic banking: The role of perceived organizational support. Al-Iqtishad: Jurnal Ilmu Ekonomi Syariah, 15(2), 327–344.
Pham, N. T., Lu, J., Ogbonnaya, C., Tuan, T. H., Degbey, W. Y., & Laker, B. (2026). A more ethical workplace? How and why perceived socially responsible human resource management makes a difference. Journal of Management Studies, 63(3), 930-960. https://doi.org/10.1111/joms.13161
PT Bank Negara Indonesia (Persero) Tbk. (2025a). Annual report 2024. PT Bank Negara Indonesia (Persero) Tbk.
PT Bank Negara Indonesia (Persero) Tbk. (2025b). Sustainability report 2024. PT Bank Negara Indonesia (Persero) Tbk.
Roy, I., Arefin, M. S., & Rahman, M. S. (2023). How do work-life support practices impact bank employees’ subjective well-being? Personnel Review, 52(3), 573–591. https://doi.org/10.1108/PR-01-2021-0050
Schaufeli, W. B., Salanova, M., González-Romá, V., & Bakker, A. B. (2002). The measurement of engagement and burnout: A two-sample confirmatory factor analytic approach. Journal of Happiness Studies, 3(1), 71–92. https://doi.org/10.1023/A:1015630930326
Simanjuntak, F., & Pratama, D. (2024). The impact of new ways of working on employee well-being in the banking sector. Management Studies and Sustainability Business Journal, 4(1), 21–35.
Sukajie, B., & Wibowo, H. (2025). Work-life balance and digital competence on employee engagement and employee retention. Jurnal Ilmiah Manajemen Kesatuan, 13(2), 201–214.
Sypniewska, B. A. (2023). Employee engagement as a determinant of employee retention in contemporary organizations. Sustainability, 15(8), 6521. https://doi.org/10.3390/su15086521
Sypniewska, B., Baran, M., & Kłos, M. (2023). Work engagement and employee satisfaction in the practice of sustainable human resource management–based on the study of Polish employees. International Entrepreneurship and Management Journal, 19(3), 1069-1100. https://doi.org/10.1007/s11365-023-00834-9
Tayossyingyong, Y., Bangbon, P., Naude, A., Zhang, P., Siribensanont, C., & Suwanchotnate, N. (2025). New modern organization management for sustainability in the 21st century. Sciences of Conservation and Archaeology, 37(2), 120-127.
Triningsih, N. N., & Putra, A. A. (2024). Compensation, work-life balance, employee engagement, and turnover intention. Quality Economics and Management Studies, 5(4), 611–624.
Wijaya, F. A., & Liana, L. (2025). The effect of work environment and work-life balance on employee retention mediated by job satisfaction. Indonesian Interdisciplinary Journal of Sharia Economics (IIJSE), 8(3), 14526–14538.
Yudhany, S. I., & Wahyuni, D. (2024). Pengaruh work-life balance terhadap employee retention melalui kepuasan kerja pada industri perbankan. Jurnal Komunikasi dan Industri, 8(1), 77–89.
Zheng, X., Zhu, W., Zhao, H., & Zhang, C. (2015). Employee well-being in organizations: Theoretical model, scale development, and cross-cultural validation. Journal of Organizational Behavior, 36(5), 621–644. https://doi.org/10.1002/job.1990
Copyright (c) 2026 Journal La Bisecoman
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
