ORIGINAL RESEARCH

 

Global challenges of the mining industry: Effect of job insecurity and reward on turnover intention through job satisfaction

 

 

Hendra Gunawan^I; Rukman Pala^II; Bakhtiar Tijjang^III; Mashur Razak^I; Besse Qur'ani^IV

^IDepartment of Management, Faculty of Economy and Business, Institut Bisnis dan Keuangan Nitro, Makassar, Indonesia
^IIPusat Riset Masyarakat dan Budaya, Badan Riset dan Inovasi Nasional, Jakarta, Indonesia
^IIIDepartment of Management, Faculty of Social Science, Institut Ilmu Sosial dan Bisnis Andi Sapada, Parepare, Indonesia
^IVJurusan Pendidikan Kesejahteraan Keluarga, Fakultas Teknik, Universitas Negeri Makassar, Makassar Indonesia

Correspondence

 

 

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ABSTRACT

ORIENTATION: This research focusses on the dynamics of job insecurity, job satisfaction and employee turnover intentions in the Indonesian mining industry facing significant global and local economic challenges.
RESEARCH PURPOSE: This research aims to investigate the influence of job insecurity and rewards on the turnover intentions of employees with job satisfaction as a mediating variable in the mining industry of Indonesia.
MOTIVATION FOR THE STUDY: This research is based on the observation that the mining industry faces high turnover rates, which can be detrimental to company operations and sustainability.
RESEARCH APPROACH/DESIGN AND METHOD: This research uses a quantitative approach by collecting data through surveys distributed to employees in various mining industries. The population in this study were employees of the mining industry in PT Vale Indonesia, totalling 3044 employees, and a sample of 230 respondents was taken at random.
MAIN FINDINGS: The main findings show that job insecurity negatively influences job satisfaction, increasing employee turnover intentions. However, when companies implement a fair and adequate reward system, the negative impact of job insecurity on job satisfaction and turnover intentions can be minimised.
PRACTICAL/MANAGERIAL IMPLICATIONS: The practical implication of this research is the importance of the mining industry developing human resource management strategies that not only focus on competitive compensation but also create a stable and satisfying work environment.
CONTRIBUTION/VALUE-ADD: This research provides an important contribution to the development of human resource management by highlighting the mediating role of job satisfaction in the relationship between job insecurity and turnover intentions. These findings provide new insights for companies in overcoming employee retention challenges with a holistic approach and good reward system.

Keywords: turnover intention; job satisfaction; job insecurity; reward; mining industry.

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Introduction

The mining industry in Indonesia has an important role in advancing the national economy. Fluctuations in global commodity prices, government policies and environmental issues have influenced the operations and sustainability of the industry in maintaining its existence (Siregar et al., 2021). Research related to employee turnover intention in this industry is relevant because it can influence efficiency, productivity and operational sustainability (Amponsah-Tawiah et al., 2016). Turnover intention in the mining industry is influenced by various factors (Tshwane et al., 2023). Literature reviews show that job dissatisfaction, job insecurity and lack of rewards are the main drivers of turnover intention. Harsh working conditions, health and safety risks and job instability in the mining industry often lead to stress and job dissatisfaction (Flatau-Harrison et al., 2023). In addition, shifts in the global economy and local politics also contribute to perceptions of job insecurity among mining workers (Karunathilake & Witharana, 2023).

Reward factors, both in the form of material (such as salary and bonuses) and immaterial (such as recognition and promotion), are other important factors that influence turnover intention (Querbach et al., 2022). Research on turnover intention in the mining industry in Indonesia offers important implications for human resource management (Ngqeza & Dhanpat, 2021), in developing strategies aimed at increasing job satisfaction, reducing job insecurity and providing appropriate rewards, adequate and fair (Ohunakin & Olugbade, 2022). Thus, it is necessary to proactively study local and global factors that influence the existence of the mining industry to adapt and survive in a dynamic and challenging environment (Khoshnevis & Tahmasebi, 2016). Job satisfaction and job insecurity factors have a significant relationship with turnover intention (Takawira et al., 2014). Conversely, perceptions of job insecurity, especially amid economic and socio-political uncertainty, increase the likelihood of employees looking for other job opportunities (Sipma et al., 2023). Research in Indonesia in particular highlights how local factors such as government policy and social conditions influence this aspect.

In the Indonesian context, research shows that a fair and competitive reward system can reduce turnover intention (Zahn et al., 2023). This is especially important in the mining industry, where employees often face harsh working conditions and require adequate incentives to remain motivated and committed (Liaquat et al., 2024). This study reveals the condition of the mining industry in Indonesia, as a sector that faces high volatility both in terms of global commodity prices and operational and environmental challenges. It is hoped that the findings in this research can become policy recommendations that can help mining companies in Indonesia overcome the problem of turnover intention, increase job satisfaction, reduce the level of job insecurity and improve reward systems (Giannikis & Mihail, 2011). This in turn can support the sustainable growth of the Indonesian mining industry and ensure the sustainability of competent human resources (Masukela et al., 2023).

 

Literature review

Underpinning theory

The theory underlying the variable managing turnover intention involves several important concepts from the field of human resource management. One of the main theories in this context is the Herzberg Job Satisfaction Model (Herzberg, 2015). The Herzberg Job Satisfaction Model plays a crucial role in understanding the reasons why employees leave their jobs in the mining industry in Indonesia, as stated in this research. According to Herzberg, two main factors influence job satisfaction: hygiene and motivation. In this study, hygiene factors such as safe working conditions and competitive salaries are essential to prevent job dissatisfaction and reduce the likelihood of employees leaving their jobs. On the other hand, motivational factors such as recognition, opportunities for advancement and a sense of achievement are critical for enhancing job satisfaction. By focussing on these motivational factors, mining companies in Indonesia can create a more committed and satisfied workforce, significantly reducing turnover rates. This alignment of Herzberg's theory with variables such as job satisfaction, job insecurity and rewards provides a robust theoretical framework for developing effective human resource strategies to minimise turnover in this critical economic sector.

Managing turnover intention is closely related to the concepts of job satisfaction, job insecurity and reward (Chung et al., 2017). As explained by Herzberg, job satisfaction theory emphasises the importance of motivational factors and a good work environment (Barkhuizen & Gumede, 2021). Motivational factors such as recognition, opportunities for growth and achievement directly increase job satisfaction and can reduce turnover intentions (Liaquat et al., 2024). On the other hand, inadequate work environment factors such as uncompetitive salaries, poor working conditions and unsupportive company policies can increase turnover intention. Therefore, to reduce turnover intention, organisations must ensure that work environmental factors are adequate while continuing to improve motivation factors. Meanwhile, job insecurity directly impacts the intention to move (Lu et al., 2023).

This insecurity can be caused by various factors, including the company's economic instability, structural change or job automation. This feeling of insecurity can reduce job satisfaction and increase turnover intention (Lee et al., 2024). On the other hand, rewards in both material and immaterial forms can increase job satisfaction and organisational commitment, reducing turnover intention (Rajabi et al., 2021). Appropriate and fair rewards not only address the problem of job insecurity but also serve as a powerful motivational factor, thereby effectively reducing employees' tendencies to seek other employment opportunities (Yang et al., 2024).

Reward and job satisfaction

The relationship between reward systems and job satisfaction among employees in the Indonesian mining industry has significant and diverse dimensions (Kasim et al., 2020). In the mining sector, where work is often physically demanding and high risk, rewards can play a key role in increasing motivation and job satisfaction (Cirillo et al., 2023). Rewards in this context not only include financial compensation such as salary, bonuses and allowances but also non-financial recognition such as career development opportunities, training and awards for work performance (Krishnamurthy et al., 2014).

The mining industry in Indonesia is one of the main economic pillars, providing effective rewards can increase employee loyalty and reduce turnover. This is important considering the high costs of recruitment and training in the mining industry (Damonte et al., 2021). In addition, rewards that are perceived to be fair and commensurate with employee contributions can increase job satisfaction, which in turn contributes to productivity and operational sustainability (Khan et al., 2021). In this context, mining companies in Indonesia need to design reward systems that are not only competitive but also align with employee needs and expectations, to ensure high job satisfaction and retention among their workers.

In the demanding and high-risk mining industry, an effective reward system plays an important role in increasing employee motivation and job satisfaction. This reward system includes not only financial compensation such as salaries, bonuses and benefits but also non-financial recognition such as career development opportunities, training and rewards for work performance. Rewards that are felt to be fair and commensurate with employee contributions are expected to increase job satisfaction, which in turn contributes to productivity and operational sustainability.

Hypothesis 1: Rewards have a positive effect on job satisfaction.

Job insecurity and job satisfaction

The relationship between job insecurity and job satisfaction in the Indonesian mining industry is a complex and multifaceted topic (Nazareno & Schiff, 2021). In this sector, job uncertainty often arises because of fluctuations in global commodity prices, changes in government policies and environmental and social issues (Wright & Griep, 2019). There are several studies relevant to the topic of the relationship between job insecurity and job satisfaction in Indonesia although not all of them specifically focus on the mining industry. One study conducted at a mining company in Indonesia examined the influence of work stress and safety climate on safety performance.

Job insecurity often arises because of fluctuations in global commodity prices, changes in government policy and environmental and social issues. Although this seems contradictory, some research shows that in some conditions, job insecurity can motivate employees to perform better, in an effort to keep their jobs, which can indirectly increase job satisfaction.

Hypothesis 2: Job insecurity has a positive effect on job satisfaction.

Job insecurity and turnover intention

In the mining industry in Indonesia, the relationship between job insecurity, reward systems, job satisfaction and turnover intention is very complex. Job uncertainty can create a sense of insecurity among employees, which negatively affects their job satisfaction. An effective reward system, including financial compensation and non-financial recognition, plays an important role in increasing job satisfaction (Serafini et al., 2020). High job satisfaction tends to reduce employees' desire to change jobs (Chung et al., 2017). Therefore, in the context of a mining industry that often faces uncertainty, it is important for companies to manage these factors effectively in order to retain their employees (Zanini et al., 2023).

Job insecurity tends to create insecurity among employees, which negatively impacts their job satisfaction. This insecurity can increase an employee's desire to find a more stable job, thereby increasing turnover intent.

Hypothesis 3: Job insecurity has a positive effect on turnover intention.

An effective reward system, which includes financial compensation and non-financial recognition, can increase job satisfaction and therefore reduce employees' desire to change jobs. When employees feel valued, both financially and non-financially, this can increase their loyalty and reduce the intention to leave the company.

Hypothesis 4: Rewards have a negative effect on turnover intention.

Employees who are dissatisfied with their jobs tend to have a higher intention to leave the job. Job satisfaction is influenced by many factors including alignment between job and personal values, working conditions, relationships with colleagues and superiors and recognition and rewards.

Hypothesis 5: Job satisfaction has a positive effect on turnover intention.

Managing turnover intention as a mediator

In the mining industry, which is often characterised by economic uncertainty and environmental risks, job insecurity is a major concern for workers (Damonte et al., 2021). Job insecurity or the perception of instability and uncertainty about a job's future, can have a significant impact on employee attitudes and behaviour (Khan et al., 2021). One of the frequently observed consequences of job insecurity is a decrease in job satisfaction (Gutierrez, 2016). When workers feel insecure about their jobs, they tend to be less satisfied with them (Artz et al., 2022). This can be caused by various factors such as uncertainty about career future, lack of control over work or fear of losing one's job (Didiharyono & Syukri, 2020).

Job satisfaction, which refers to a person's positive or negative feelings towards their job, plays an important role in determining turnover intention (Chung et al., 2017). Employees who are dissatisfied with their jobs are more likely to have the intention to leave their jobs. This is because job satisfaction is closely related to factors such as harmony between work and personal values, working conditions, relationships with colleagues and superiors, as well as recognition and rewards (Kennedy & Widener, 2019).

The mining industry in Indonesia often faces challenges such as fluctuating commodity prices, strict environmental regulations and social issues. This can increase job insecurity and insecurity among workers. If not managed well, it can cause a decrease in job satisfaction, which ultimately contributes to employees' intention to change jobs (Barkhuizen & Gumede, 2021).

Rewards in the work context not only include financial compensation such as salary and bonuses but also non-financial rewards such as recognition, career development opportunities and a supportive work environment (Wright & Griep, 2019). Rewards play a key role in reducing the negative impact of job insecurity on turnover intention. When employees feel appreciated and recognised, both financially and non-financially, this can reduce their perceptions of insecurity and increase their commitment to the organisation (Serafini et al., 2020).

Job insecurity is higher because of external and internal factors, and effective rewards can be an important strategy for managing turnover intention. Providing fair and transparent bonuses based on performance can reduce anxiety about employees' financial stability (Pihlajamaa, 2017). Meanwhile, recognition of hard work and achievements, as well as opportunities for career development, can increase workers' sense of security in terms of their status and future within the company (Mello et al., 2023).

Job insecurity affects turnover intentions indirectly through job satisfaction. Perceptions of instability and uncertainty about the future of work can decrease job satisfaction, which in turn increases turnover intent.

Hypothesis 6: Job insecurity influences turnover intention through job satisfaction.

A well-designed reward system can reduce turnover intentions by increasing job satisfaction. Fair and transparent rewards can reduce employees' anxiety regarding their financial stability and increase their sense of security at work, reducing the intention to change jobs.

Hypothesis 7: Rewards influence turnover intention through job satisfaction.

 

Research design

Data collection

The research method used based on the characteristics of the main research problem is the associative method. The design of this research is a survey with a quantitative approach. Data collection was carried out from June to December 2023 to obtain the information needed to achieve research objectives with the Google Forms online survey. The population in this study were employees of the mining industry in PT Vale Indonesia, totalling 3044 employees, and a sample of 230 respondents was taken at random.

Research instrument

To estimate the main research variables, the author used instruments from previous research. In measuring turnover intention, the author followed Gregory et al. (2009), which consists of thinking of quitting, searching for job alternatives, intention to quit, work stress and justice. For measuring job insecurity, Sverke and Hellgren (2002) indicators are used, which include the meaning of work, level of threat, helplessness, work involvement and trust in superiors. Then, rewards use indicators in Gibson (1997), which consist of wages, salaries, incentives, allowances and promotions. Finally, the job satisfaction instrument Robbins and Judge (2013) suggests indicators including mentally challenging work, supportive working conditions, fair wages, suitability of personality to the job and supportive co-workers. Research constructs are accessed on a Likert scale ranging from scores of (1) 'strongly disagree', (2) 'disagree', (3) 'undecided', (4) 'agree' to (5) 'strongly agree' (Mumu et al., 2022).

Data analysis

The data analysis used is a descriptive statistical method in obtaining the distribution of respondents' answers through mean size and standard deviation. Then, use inferential statistical methods through structural equation model (SEM) analysis with partial least square (SEM-PLS), can work with data that are not normally distributed because SEM PLS is a non-parametric statistic. In addition, PLS-SEM can be used with complex models with limited research samples and includes non-parametric statistical groups (Hair et al., 2019). Thus, the author estimates the structural model (inner model) to calculate the final model and test hypotheses.

Ethical considerations

An ethics permit has been granted by the Research Ethics Committee of the Nitro Makassar Institute of Business and Finance (IBK). Ethical Certificate Reference Number 214/ECE-1/IBKN/2/2024.

 

Results

Descriptive statistics

Respondents in the study were 230 employees with their characteristics based on age, gender, education and length of work which are shown in Table 1. From Table 1, it is clear that the majority of employees are between 31 years and 40 years old, male, have a minimum of high school education and have work experience of more than 5 years. PT Vale Indonesia was chosen as the research location because it has several unique characteristics, including a larger number of mining industries compared to the Western Indonesian region.

 

 

Research method

The research design used is a quantitative approach with survey methods. The survey was conducted on employees of mining companies in Indonesia. The reason for undertaking studies in this area considers the unique characteristics of mining employees to support the sustainable growth of the Indonesian mining industry by maintaining competent human resources and engaging in a sustainable mining sector. Studies related to the performance of Indonesian mining employees as a guide for mining companies in overcoming the problem of turnover intention and creating a more stable and satisfying work environment for employees. Apart from that, mining companies spread across Indonesia are large and complex organisations with quite a large number of employees. This allowed the researcher to obtain a large and diverse sample of employees for this study.

Factor and reliability analysis

According to Sarstedt et al. (2021) the embedded method with two approaches can be used as an estimation method in second-order models where estimation is carried out in two steps. In the first step, there is an estimate at the dimension or sub-variable level using indicators in measuring the variable, and in the second step, the latent variable score is used as the dimension or sub-variable score. The validity test analyses confirmatory factors in each latent variable by looking at the determined convergent validity and discriminant validity. The measurement model in this research consists of a reflective measurement model where the variables turnover intention, job satisfaction, job insecurity and reward are measured reflectively. According to Hair et al. (2021), the evaluation of the reflective measurement model consists of a loading factor ≥ 0.70, composite reliability ≥ 0.70 and average variance extracted (AVE) ≥ 0.50, as well as evaluation of discriminant validity, namely the Fornell and Lacker criteria and Heterotrait Monotrait ratio (HTMT) ≤ 0.90.

In Table 2, it can be seen that the variables reward, job insecurity, job satisfaction and turnover intention are measured by five valid measurement items > 0.70, which indicates that these measurement items are strongly correlated. The level of reliability is acceptable with composite reliability values > 0.70 and Cronbach's alpha > 0.70, as well as convergent validity with AVE values > 0.50 (Sarstedt et al., 2021).

 

 

In Table 3, the evaluation of discriminant validity needs to be carried out by looking at the Fornell and Lacker criteria (Sarstedt et al., 2021). The job insecurity variable has a greater AVE root (0.817), a greater correlation with the job satisfaction variable (0.795), a greater correlation with the reward variable (0.847) and a greater correlation with the turnover intention variable (0.877). Hair et al. (2019) recommend HTMT because this validity measure is considered more sensitive or accurate in detecting discriminant validity. The recommended value is less than 0.90. The test results in Table 3 show that the HTMT value is less than 0.90 for the variable pair, so discriminant validity is achieved. Variables divide the variation of measurement items into the items that measure them more strongly than dividing the variance into other variable items.

 

 

Structural model

The structural model follows the Hair et al. (2019) procedure, which produces a research hypothesis that shows that the reward, job insecurity, job satisfaction and turnover intention hypotheses produce an analysis of the influence between the variables depicted in the path coefficient (see Figure 1).

In research on the mining industry in Indonesia, PLS-SEM analysis shows the following results:

Reward (X1) and job satisfaction (Z): The path coefficient between reward and job satisfaction is 0.486 with a p-value of 0.000, indicating a positive and significant effect of reward on job satisfaction. This confirms Hypothesis 1 that the reward system has a strong positive effect on employee job satisfaction. Loadings for reward indicators (X1_1 to X1_5) also show that they are significantly relevant in measuring the reward construct.

Job insecurity (X2) and job satisfaction (Z): The relationship between job insecurity and job satisfaction has a path coefficient of 0.260 (p-value 0.000), indicating a significant positive relationship, according to what Hypothesis 2 shows. This is surprising because it is generally thought that job insecurity will negatively influence job satisfaction, but in this context, the data suggest otherwise. The loadings of the job insecurity indicators (X2_1 to X2_5) confirm that each indicator strongly represents the job insecurity construct.

Job satisfaction (Z) and turnover intention (Y): Job satisfaction has a negative influence on turnover intention with a path coefficient of -0.098 (p-value 0.001). Although this coefficient shows a smaller influence, it is still significant and supports Hypothesis 5 that job satisfaction has a negative effect on turnover intent, meaning the higher the job satisfaction, the lower the desire for turnover.

The direct relationship of reward and job insecurity to turnover intention: There is a direct negative influence of reward to turnover intention (Hypothesis 4) with a path coefficient of -0.837 (p-value 0.000) and a direct positive influence of job insecurity to turnover intention (Hypothesis 3) with a path coefficient of 0.034 (p-value 0.393). Although the path coefficient from job insecurity to turnover intention looks positive, the p-value indicates that this relationship is insignificant, requiring further review of Hypothesis 3.

Mediating job satisfaction (Z): This study also explores the mediation of job satisfaction in the relationship between reward and job insecurity to turnover intention. Although the model suggests that job satisfaction acts as a mediator, it should be noted that the direct effect of job insecurity on turnover intention is not significant, challenging Hypothesis 6 and Hypothesis 7.

Turnover intention (Y): The turnover intention (Y) construct has high and significant loadings for all its indicators (Y1 to Y5), indicating that this construct is well-measured in the model.

Figure 1 shows that R-square collinearity analysis (R²) are 0.476 and 0.863; according to Chin (1998), the qualitative interpretation value of R² is highly influenced, and the Q-square collinearity analysis results are 0.275 and 0.651. According to Hair et al. (2019), a Q² value above 0 indicates the model has predictive relevance, and a Q² model value above 0 indicates the model has predictive relevance. The estimation results show that the inner VIF value ranges from 1843 to 2295, so the measurement used to check collinearity is the inner VIF (variance inflated factor), which is recommended below < 5.00 (noncollinearity) (Sarstedt et al., 2021).

Table 4 shows that hypothesis testing is carried out based on the results of inner model testing (structural model), which includes R-square output, parameter coefficients and t-statistics. Consider the significance values between constructs, t-statistics and p-values to see whether a hypothesis can be accepted or rejected. These values can be seen from the bootstrapping results. The rules of thumb used in this research are t-statistics > 1.96 with a p-value of 0.05 (5%) significance level and positive beta coefficient. The hypothesis testing value of this research can be shown in Table 4, and the results of this research model can be depicted as shown in Figure 1.

According to Table 4, the results of Hypothesis 1 test whether rewards positively influence job satisfaction. The test results show that the beta reward coefficient value for job satisfaction is 0.486, and the t-statistic is 6.406. In the 95% confidence interval, the influence of rewards in increasing job satisfaction is 0.386. These results show that the t-statistic is significant because it is > 1.96 with a positive p-value < 0.05, so Hypothesis 1 is accepted. This proves that rewards are proven to influence job satisfaction positively. The results of Hypothesis 1 are accepted.

The results of Hypothesis 2 analysis test whether job insecurity positively influences job satisfaction. The test results show that the beta coefficient value for job insecurity on job satisfaction is 0.260, and the t-statistic is 4.308. In the 95% confidence interval, the influence of job insecurity in increasing job satisfaction is 0.627. These results show that the t-statistic is significant because it is > 1.96 with a positive p-value < 0.05, so Hypothesis 2 is accepted. This proves that job insecurity is proven to have a positive influence on job satisfaction. The results of Hypothesis 2 are accepted.

The results of the Hypothesis 3 analysis test whether rewards positively influence turnover intention. The test results show that the beta coefficient value for reward on turnover intention is 0.486 and the t-statistic is 27 740. In the 95% confidence interval, the influence of rewards in increasing turnover intention is 0.945. These results show that the t-statistic is significant because it is > 1.96 with a positive p-value < 0.05, so Hypothesis 3 is accepted. This proves that rewards influence turnover intention positively. The results of Hypothesis 3 are accepted.

The results of the Hypothesis 4 analysis test whether job insecurity positively influences turnover intention. The test results show that the beta coefficient value for job insecurity on turnover intention is 0.034, and the t-statistic is 0.854. In the 95% confidence interval, the influence of rewards in increasing turnover intention is 0.136. These results show that the t-statistic is significant because it is <1.96 with a negative p-value > 0.05, so Hypothesis 4 is rejected. This proves that job insecurity has not positively influenced turnover intention. The results of Hypothesis 4 are non-accepted.

Hypothesis 5 tests whether job satisfaction positively influences turnover intention. The test results show that the beta coefficient value for job satisfaction on turnover intention is 0.098, and the t-statistic is 3384. In the 95% confidence interval, the influence of job satisfaction in increasing turnover intention is 0.154. These results show that the t-statistic is significant because it is > 1.96 with a positive p-value < 0.05, so Hypothesis 5 is accepted. This proves that job satisfaction is proven to have a positive influence on turnover intention. The results of Hypothesis 5 are accepted.

Hypothesis 6 tests whether rewards positively influence turnover intention through job satisfaction. The test results show that the beta coefficient value for reward on turnover intention through job satisfaction is 0.048, and the t-statistic is 3183. In the 95% confidence interval, the influence of rewards in increasing turnover intention through job satisfaction is 0.083. These results show that the t-statistic is significant because it is > 1.96 with a positive p-value < 0.05, so Hypothesis 6 is accepted. This proves that rewards positively influence turnover intention through job satisfaction. The results of Hypothesis 6 are accepted.

Meanwhile, Hypothesis 7 tests whether job insecurity positively influences turnover intention through job satisfaction. The test results show that the beta coefficient of job insecurity on turnover intention through job satisfaction is 0.025, and the t-statistic is 2.581. In the 95% confidence interval, the influence of job insecurity in increasing turnover intention through job satisfaction is 0.084. These results show that the t-statistic is significant because it is > 1.96 with a positive p-value < 0.05, so Hypothesis 7 is accepted. This proves that job insecurity is proven to have a positive influence on turnover intention through job satisfaction. The results of Hypothesis 7 are accepted.

 

Discussion

Quantitative analysis involving respondents from various mining companies in Indonesia, this study succeeded in showing that there is a significant relationship between rewards and job satisfaction. One of the key findings is that a reward system that is perceived as fair and adequate by employees contributes positively to increasing job satisfaction, which is statistically significant, supporting the hypothesis that rewards influence job satisfaction positively (Ohunakin & Olugbade, 2022; Siwela & Van der Bank, 2021; Zulkarnain et al., 2024). The uniqueness of this study also lies in its comprehensive approach to examining the influence of rewards and job satisfaction. This research fills the research gap by showing how a combination of these factors simultaneously interact and influence employees' decisions to stay or leave the company. These findings are important for stakeholders in the mining industry to develop more effective strategies in human resource management, especially in the context of increasing employee retention and reducing turnover intentions. This study supports that rewards positively influence job satisfaction (Aung et al., 2023; Ramhit, 2019).

This research also reveals paradoxical findings in the Indonesian mining industry, showing that job insecurity unintuitively has a positive effect on job satisfaction. Using a quantitative methodology through a survey of employees, this study found that under certain conditions, job insecurity motivates employees to see the positive side of their work as a form of adaptation to uncertainty, which contradicts the dominant narrative that links job insecurity with a negative impact on employee well-being. These findings highlight how Indonesia's specific socio-economic dynamics and work culture can influence employees' perceptions of job insecurity, filling the knowledge gap by demonstrating employees' unique coping strategies in facing economic uncertainty and company policies in a challenging work environment, as supported in Nazareno and Schiff (2021).

This research highlights that rewards have a significant influence in reducing employee turnover intentions in the Indonesian mining industry. This research finds that a reward system that is perceived as fair and adequate by employees significantly contributes to reducing their desire to leave the company. These findings confirm the motivation theory, which states that effective rewards can create a sense of appreciation and job satisfaction, which ultimately influences employees' decisions to stay at the company. The finding that effective rewards can reduce turnover intentions is an important contribution to understanding how companies can retain their workforce in unstable market conditions. Uniquely, the results of this study also reveal that in harsh work environments such as mining, where work risks are high, and work pressure often occurs, rewards are seen not only in terms of material but also in recognition and appreciation for employee contributions.

This marks the uniqueness of this research by showing that non-financial reward factors have an important role in determining job satisfaction and reducing turnover intentions. These research results offer a new perspective on employee retention strategies, suggesting that mining companies should design their reward systems not only to meet employees' financial needs but also to recognise and reward their contributions holistically, as supported in Barkhuizen and Gumede (2021) and Siwela and Van der Bank (2021).

This research reveals that job insecurity does not encourage employees to leave. These findings contrast with the human resource management literature, which often links job insecurity with increased turnover intentions, indicating a more complex and multifaceted dynamic in the relationship between job insecurity and employees' decisions to stay or move. The novelty of this research lies in its in-depth understanding of the context of the mining industry in Indonesia, a sector faced with high levels of global and local economic uncertainty. The finding that job insecurity has no positive effect on turnover intentions highlights the possibility that other factors, such as job satisfaction, work engagement or cultural values, may play a more dominant role in influencing employees' decisions to stay. This offers a new perspective and enriches the academic discussion around the influence of job insecurity by suggesting that its impact on turnover intentions may differ depending on industry and cultural context. By not finding a positive relationship between job insecurity and turnover intentions, this study provides consideration of effective human resource management strategies in overcoming job insecurity, suggesting that a more holistic and integrated approach is needed to maintain employee retention as supported in Alatawi et al. (2023), Amushila and Bussin (2021) and Smit et al. (2021).

This research specifically explores the influence of job satisfaction on employee turnover intentions in the context of the mining industry in Indonesia, producing significant findings indicating the positive influence of job satisfaction in reducing intentions to leave the company. The novelty of this research lies in its focus on the mining industry in Indonesia, a sector that faces unique challenges such as harsh working conditions, high safety risks and global economic fluctuations. In a context like this, the finding that job satisfaction positively influences turnover intentions adds a new layer of understanding to how working conditions and human resource management can be developed to increase employee retention. This research highlights the importance of aspects such as job security, recognition, fair compensation and a supportive work environment in creating job satisfaction.

The uniqueness of this research also lies in the use of empirical data from employees in the mining sector, providing concrete and applicable insights for human resource management in this sector. The finding that job satisfaction has a positive effect on reducing turnover intentions shows the importance of management strategies that focus on improving aspects that influence job satisfaction. This shows that companies need to do more than just meet employees' basic needs; they must also invest in the psychological and emotional aspects of employees' work experience as supported in Stamolampros et al. (2019).

This research investigates the relationship between rewards, job satisfaction and turnover intentions in the context of the mining industry in Indonesia, finding that rewards have a positive effect on turnover intentions through the mediator of job satisfaction. These findings provide empirical confirmation of the theoretical model, which states that job satisfaction is an important mediator in the relationship between rewards and turnover intentions. The novelty of this research lies in its use of a mediation model to explore how rewards influence turnover intentions through job satisfaction in the Indonesian mining industry, a sector characterised by challenging working conditions and fluctuating market dynamics. It adds a new perspective to the existing literature by identifying and testing the specific mechanisms through which rewards influence employees' decisions to stay or leave their jobs, emphasising the important role of job satisfaction as a determining factor. This research highlights how factors such as fairness and reward adequacy can influence employee satisfaction and retention in unique work environments, offering concrete evidence of the importance of reward system design that considers industry and location contextual specificities as supported in Wang et al. (2021).

This research reveals a complex relationship between job insecurity, job satisfaction and turnover intentions in the mining industry in Indonesia. The novelty of this research lies in its application of the mediation model to understand the mechanisms behind the influence of job insecurity on turnover intentions in the context of the Indonesian mining industry. This research enriches the literature by highlighting how employees' internal dynamics, such as job satisfaction, serves as a critical link between external insecurities and their decisions about the future of work. This adds a deeper layer of understanding about the psychological impact of job insecurity and how it influences turnover behaviour. The uniqueness of this research also stems from its geographic and industry-specific focus. The mining industry in Indonesia, with its unique operational challenges and market volatility, provides a rich context for exploring factors influencing employee retention. Through this industry lens, research offers valuable insights into the importance of managing perceptions of job insecurity to maintain a satisfied and committed workforce as supported in Singh et al. (2024).

Practical implications

This study offers significant insight into the dynamics of reward and job insecurity in the mining industry in Indonesia. The practical implications of these results include the need for mining companies to design and implement comprehensive reward systems focussed not only on financial compensation but also on recognition and career development that can strengthen employee job satisfaction. This, in turn, can reduce turnover intent and help companies retain a skilled workforce in an often unstable work environment.

Limitations of the study

This study has several limitations that must be considered. Firstly, the relationship between job insecurity and job satisfaction is influenced by external factors not present in this model, such as macroeconomic factors or government policies. Secondly, the data used does not fully cover the perceptions and experiences of all employees in Indonesia's mining industry, which is geographically and culturally diverse. Thirdly, the study used a cross-sectional design that could not capture changes in turnover intentions or job satisfaction over time.

Recommendations

Based on the study's results, mining companies should periodically evaluate and adjust the reward system to remain relevant and motivational. Companies must also actively communicate with employees about insecurities and offer support programmes to address their negative impacts. In addition, companies are advised to pay attention to non-financial aspects of awards, such as training opportunities and professional development, which significantly impact job satisfaction.

Future research

For future research, it is advisable to conduct longitudinal studies to understand how the relationship between reward, job insecurity, job satisfaction and turnover intention develops over time. Research sampling from different regions and different types of jobs within the mining industry can help understand these dynamics further. In addition, integrating additional moderation or mediation variables such as social support, organisational commitment or job identity can provide more comprehensive insight into the mechanisms underlying these relationships.

 

Conclusion

This research highlights the negative relationship between job insecurity and job satisfaction and its influence on turnover intentions in the mining industry of Indonesia, with the finding that a fair and adequate reward system can reduce the negative impact of job insecurity on turnover intentions through increasing job satisfaction. Thus, it can be recommended that the mining industry of Indonesia implement a comprehensive reward system, which includes competitive financial compensation and non-financial reward aspects, manage sources of job insecurity with transparent communication and invest in employee development. Implementing fair and transparent management practices is also important for increasing job satisfaction and employee retention. These findings offer strategic guidance for human resource management in the mining industry to address employee retention challenges and maintain a stable and competent workforce.

The advantage of this study also lies in its comprehensive approach in examining the influence of rewards and job insecurity on turnover intentions through job satisfaction as an intervening variable. So this research fills the research gap by showing how a combination of these factors simultaneously influences employees' decisions to stay or leave the company. These findings are important for stakeholders in the mining industry to develop more effective strategies in human resource management, especially in the context of increasing employee retention and reducing turnover intentions.

 

Acknowledgements

Competing interests

The authors declare that they have no financial or personal relationship(s) that may have inappropriately influenced them in writing this article.

Authors' contributions

H.G., R.P., B.T., M.R. and B.Q. contributed to the conceptualisation and design of the study. H.G., R.P., B.T., M.R. and B.Q. performed material preparation, data collection and analysis. H.G. wrote the first draft of the manuscript, and all authors commented on earlier versions. All authors read and approved the final manuscript.

Funding information

This research received no specific grant from any funding agency in the public, commercial or not-for-profit sectors.

Data availability

The datasets generated and/or analysed during the current study are available from the corresponding author, H.G., upon reasonable request.

Disclaimer

The views and opinions expressed in this article are those of the authors and are the product of professional research. It does not necessarily reflect the official policy or position of any affiliated institution, funder, agency or that of the publisher. The authors are responsible for this article's results, findings and content.

 

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Correspondence:
Hendra Gunawan
hendramanajemen@gmail.com

Received: 16 Feb. 2024
Accepted: 30 Apr. 2024
Published: 28 June 2024