Assessing the Effects of Employee Turnover on the Performance of Small and Medium-Scale Enterprises in Nigeria

The significant role small and medium-scale enterprises (SMEs) plays in growth and development is acknowledged universally. As a group, they generate more new jobs and introduce innovative ideas, products, and business methods. However, this important group is incapacitated by numerous factors militating against their growth, particularly in Third World countries such as Nigeria. In this study the authors identified major factors that affect the productivity of SMEs thereby hindering their growth. Their findings relate factors such as the dearth of skills, absence of managerial talents, and employee turnover to enterprise performance, productivity, and growth ability. Employee turnover is found to have a significant and negative correlation with SME performance. This indicates that the lower the employee turnover, the higher the performance of SMEs, and vice versa.