Moving Against Turnover Intentions Through Transactional Leadership, Organizational Climate, and Psychological Contract Fulfillment: Evidence from the Middle Eastern Hotel Industry

Abstract

Turnover is a major concern for the hotel and hospitality industry on a global scale. This research focuses on several Middle Eastern five-star hotels in terms of transactional leadership and its relationship with employees’ turnover intentions. In addition, the mediating effect of organizational climate, along with the moderating influence of psychological contract fulfillment are examined. This research combines the premises of social exchange, organizational support, and psychological contract theories to support the development of hypotheses. A total of 350 employee data from five-star hotels in Saudi Arabia, Lebanon, Egypt, Jordan, and Bahrain was gathered using surveys using a convenience sampling method. The research used Partial Least Squares—Structural Equation Modeling (PLS-SEM) to analyze the hypotheses, which were supported by the results obtained. The importance of organizational climate and fulfilling psychological contracts is highlighted, which, under transactional leadership, can reduce turnover intentions. This is critical for the labor-intensive hotel sector with high turnover rates and random and unpredictable tasks. Transactional leadership is found to be a good fit for the Middle Eastern hotel sector through routinization and a structural approach. The current findings can be beneficial for scholars and practitioners.