This study empirically investigates the impact of public institution headquarters’ location on employee turnover rates and analyzes how organizational size, an internal characteristic, moderates this relationship. Following the implementation of the...
This study empirically investigates the impact of public institution headquarters’ location on employee turnover rates and analyzes how organizational size, an internal characteristic, moderates this relationship. Following the implementation of the public institution relocation policy, some organizations have experienced continuously increasing turnover rates due to deteriorated living conditions, family separation, and disconnection from metropolitan communities. This phenomenon suggests that beyond individual psychological intention to leave, the structural condition of an organization’s physical location substantially influences actual workforce outflow.
This study applies the Gravity Model as a theoretical framework to explain the relationship between spatial distance and employee turnover, and conducts an empirical analysis using panel data from 68 public enterprises and quasi-governmental institutions from 2021 to 2023. The metropolitan accessibility of the headquarters location was set as the independent variable, institutional turnover rate as the dependent variable, and organizational size (based on authorized personnel) as the moderating variable. Control variables included average tenure, average salary level, and institution type, which were analyzed using multiple regression analysis.
Results revealed that turnover rates significantly increased as metropolitan accessibility decreased, empirically demonstrating that geographical location negatively affects members’ organizational commitment, job satisfaction, and long-term career planning. Organizational size independently showed a negative effect on turnover rates; however, the interaction effect between metropolitan accessibility and size was not statistically significant, suggesting that even larger institutions cannot completely offset geographical disadvantages. Among control variables, average tenure and salary levels significantly reduced turnover rates, while public enterprises showed relatively lower turnover rates than quasi-governmental institutions.
Additional individual-level analysis revealed a concentration of resignations among employees in their 30s, increased departure rates for employees with less than three years of tenure, and relatively higher turnover tendencies among branch office workers compared to headquarters staff. This demonstrates the relationship between internal organizational systems and career transition stress among members. Specifically, the study confirmed that institutional limitations—such as inefficient rotation systems, unpredictable transfer locations, and insufficient residence support programs—collectively influence members’ decisions to leave.
This study holds academic significance by expanding existing internal-focused human resource management discussions into a structural analytical framework by connecting organizational turnover to exogenous environmental factors such as metropolitan accessibility. Furthermore, the empirical results provide various policy implications for designing public institution relocation policies, improving residence support systems, reconsidering rotation system operations, and developing workforce retention strategies for small and medium-sized institutions. It serves as a significant theoretical and empirical foundation supporting the need for integrated design between location decisions and human resource management strategies, especially as the second phase of public institution relocation is currently under discussion. Future research requires more sophisticated analytical designs through the development of long-term time series data, integration of non-quantitative factors through qualitative research methods, and in-depth analysis of multi-level interactions between organizations and individuals.