Work-Life Balance and Digital Competence on Employee Retention with Employee Engagement as a Mediating Variable

Bambang Sukajie; Rian Andriani

doi:10.37641/jimkes.v13i6.4691

Authors

Bambang Sukajie Universitas Adhirajasa Reswara Sanjaya, Indonesia
Rian Andriani Universitas Adhirajasa Reswara Sanjaya, Indonesia

DOI:

https://doi.org/10.37641/jimkes.v13i6.4691

Keywords:

Digital Competence, Employee Engagement, Employee Retention, Startup Digital, Work-Life Balance

Abstract

Employee retention is a critical challenge for startups operating in dynamic labor markets. This study examines the effects of work-life balance and digital competence on employee retention, with employee engagement as a mediating variable. This study was conducted among 250 service sector employees in Jakarta, Bandung, and Yogyakarta. This study uses a quantitative approach employing SEM-PLS analysis. The results reveal that work-life balance positively influences employee engagement and employee retention. Similarly, digital competence significantly affects employee engagement and employee retention. Employee engagement itself strongly predicts employee retention and mediates the relationship between work-life balance and retention as well as digital competence and retention. These findings highlight that enhancing work-life balance and developing digital competence are essential strategies to foster employee engagement, which in turn strengthens retention. The study underscores the strategic role of employee engagement as a mediator in translating human resource practices into long-term commitment, offering practical insights for startups to maintain a productive, adaptive, and loyal workforce in competitive digital environments.

Downloads

Download data is not yet available.

References

Ahmed, S., Ashrafi, D. M., Ahmed, R., Ahmed, E., & Azim, M. (2025). How employee engagement mediates the training and development and work–life balance towards job performance of the private banks?. The TQM Journal, 37(7), 2015-2040.

Ahyat, M., & Hamdi, N. (2024). The influence of employee engagement on work efficiency in the creative industry in Mataram City: Analysis of digital competence, dedication, and work environment dimensions. Journal of Management, 3(2), 748-760.

Al Zeer, I., Ajouz, M., & Salahat, M. (2023). Conceptual model of predicting employee performance through the mediating role of employee engagement and empowerment. International Journal of Educational Management, 37(5), 986-1004.

Al-kharabsheh, S. A., Attiany, M. S., Alshawabkeh, R. O. K., Hamadneh, S., & Alshurideh, M. T. (2022). The impact of digital HRM on employee performance through employee motivation. International Journal of Data and Network Science, 7(1), 275-282.

Ampofo, E. T., & Karatepe, O. M. (2022). The effects of on-the-job embeddedness and its sub-dimensions on small-sized hotel employees’ organizational commitment, work engagement and turnover intentions. International Journal of Contemporary Hospitality Management, 34(2), 509-533.

Andari, A., Nafiudin, N., & Purnamasari, R. (2021). The influence of the work environment and employee engagement on employee retention. Almana: Jurnal Manajemen dan Bisnis, 5(3), 447-453.

Anitha, J. (2014). Determinants of employee engagement and their impact on employee performance. International journal of productivity and performance management, 63(3), 308-323.

Azmy, A. (2021). The effect of employee engagement and job satisfaction on workforce agility through talent management in public transportation companies. Media Ekonomi dan Manajemen, 36(2), 212-229.

Bahar, A. M., Islam, M. A., Hamzah, A., Islam, S. N., & Reaz, M. D. (2022). The efficacy of work-life balance for young employee retention: a validated retention model for small private industries. International Journal of Process Management and Benchmarking, 12(3), 367-394.

Bedarkar, M., & Pandita, D. (2014). A study on the drivers of employee engagement impacting employee performance. Procedia-Social and Behavioral Sciences, 133(1), 106-115.

Bokek-Cohen, Y. A. (2018). Conceptualizing employees’ digital skills as signals delivered to employers. International Journal of Organization Theory & Behavior, 21(1), 17-27.

Cetindamar, K, D., & Abedin, B. (2021). Understanding the role of employees in digital transformation: conceptualization of digital literacy of employees as a multi-dimensional organizational affordance. Journal of Enterprise Information Management, 34(6), 1649-1672.

Chopra, A., Sahoo, C. K., & Patel, G. (2024). Exploring the relationship between employer branding and talent retention: The mediation effect of employee engagement. International Journal of Organizational Analysis, 32(4), 702-720.

Deery, M., & Jago, L. (2015). Revisiting talent management, work-life balance and retention strategies. International Journal of Contemporary Hospitality Management, 27(3), 453-472.

Duan, S. X., Deng, H., & Wibowo, S. (2023). Exploring the impact of digital work on work–life balance and job performance: A technology affordance perspective. Information Technology & People, 36(5), 2009-2029.

Ekhsan, M., Badrianto, Y., & Suwandi, S. (2023). Digital talent on employee retention: the role of employee engagement as mediation. Journal of Law and Sustainable Development, 11(10), 1121-1121.

Faadhilah, N. R., Andriani, D., & Firdaus, V. (2025). The influence of work environment, job skills, and work engagement on employee productivity in MSMEs. Jurnal Ilmiah Manajemen Kesatuan, 13(1), 271-282.

Fisher, G. G., Bulger, C. A., & Smith, C. S. (2009). Beyond work and family: A measure of work/nonwork interference and enhancement. Journal of occupational health psychology, 14(4), 441-452.

Grimpe, C., Sofka, W., & Kaiser, U. (2023). Competing for digital human capital: The retention effect of digital expertise in MNC subsidiaries. Journal of International Business Studies, 54(4), 657-685.

Huu, P. T. (2023). Impact of employee digital competence on the relationship between digital autonomy and innovative work behavior: A systematic review. Artificial Intelligence Review, 56(12), 14193-14222.

Ingsih, K., Astuti, S. D., & Riyanto, F. (2024). The role of digital competence in improving service quality and employee performance. SA Journal of Human Resource Management, 22(1), 2689-2701.

Islam, M. S., Amin, M., Feranita, F., & Karatepe, O. M. (2023). High-involvement work practices, work engagement and their effects on bank employees’ turnover intentions: the moderating role of functional competence. International Journal of Bank Marketing, 41(6), 1360-1388.

Jaharuddin, N. S., & Zainol, L. N. (2019). The impact of work-life balance on job engagement and turnover intention. The South East Asian Journal of Management, 13(1), 7-20.

Janssen, J., Stoyanov, S., Ferrari, A., Punie, Y., Pannekeet, K., & Sloep, P. (2013). Experts’ views on digital competence: Commonalities and differences. Computers & education, 68(1), 473-481.

Kaur, R., & Randhawa, G. (2021). Supportive supervisor to curtail turnover intentions: do employee engagement and work–life balance play any role?. In Evidence-based HRM: a Global Forum for Empirical Scholarship (Vol. 9, No. 3, pp. 241-257). Leeds: Emerald Publishing Limited.

Kurniawati, E., & Ramli, A. H. (2024). The influence of procedural justice, organizational trust, and organizational commitment on work engagement. Jurnal Ilmiah Manajemen Kesatuan, 12(3), 755-772.

Kyndt, E., Dochy, F., Michielsen, M., & Moeyaert, B. (2009). Employee retention: Organisational and personal perspectives. Vocations and learning, 2(3), 195-215.

Lestari, D., & Margaretha, M. (2021). Work life balance, job engagement and turnover intention: Experience from Y generation employees. Management Science Letters, 11(1), 157-170.

Manalu, N. C. (2025). The effect of digital competence, social capital, emotional intelligence on teacher performance through job satisfaction. Jurnal Ilmiah Manajemen Kesatuan, 13(3), 1455-1468.

Mustaqim, H., Alhempi, R. R., Siregar, B. A., & Shaddiq, S. (2024). The relationship between employee engagement and goal orientation towards competence and employee performance. Calitatea, 25(198), 211-221.

Novianti, I. E., & Ramli, A. H. (2023). The influence of intrinsic and extrinsic motivation on employee engagement and job satisfaction in the snack food industry. Jurnal Ilmiah Manajemen Kesatuan, 11(3), 1389-1400.

Opoku, F. K., Kwao, I. T., & Johnson, A. P. (2023). Human resource policies and work–life balance in higher education: Employee engagement as mediator. SA Journal of Human Resource Management, 21(1), 1939-1950.

Park, J., Han, S. J., Kim, J., & Kim, W. (2022). Structural relationships among transformational leadership, affective organizational commitment, and job performance: The mediating role of employee engagement. European Journal of Training and Development, 46(9), 920-936.

Rathi, S., & Kumar, P. (2023). The mediating role of job satisfaction between work-life balance and employee retention. In Climate change management and social innovations for sustainable global organization (pp. 241-262). Pennsylvania: IGI Global.

Riyanto, S., Endri, E., & Herlisha, N. (2021). Effect of work motivation and job satisfaction on employee performance: Mediating role of employee engagement. Problems and Perspectives in Management, 19(3), 162-173.

Rustina, E., Dermawan, A., & Vidyaningrum, B. (2025). The impact of job satisfaction and employee engagement on employee performance. Jurnal Ilmiah Manajemen Kesatuan, 13(3), 1859-1870.

Satrianny, I. P., Thamrin, N., Harianto, A., & Novirsari, E. (2025). The effect of employee morale and organizational familiarity on innovative work behavior through employee engagement. Jurnal Ilmiah Manajemen Kesatuan, 13(2), 1093-1104.

Schaufeli, W. B., & Bakker, A. B. (2004). Job demands, job resources, and their relationship with burnout and engagement: A multi‐sample study. Journal of Organizational Behavior: The International Journal of Industrial, Occupational and Organizational Psychology and Behavior, 25(3), 293-315.

Setiawan, I., & Prasojo, S. (2021). Effect of talent management and employee engagement on turnover intention with employee retention mediation. Journal of Business Management and Accounting, 3(2), 55-63.

Shilpakar, N., Giri, B., & Pokhrel, S. K. (2024). Flexible working arrangements and employee turnover intention: Mediating role of employee engagement. SAIM Journal of Social Science and Technology, 1(1), 27-39.

Shockley, K. M., Smith, C. R., & Knudsen, E. A. (2017). The impact of work–life balance on employee retention. The Wiley Blackwell handbook of the psychology of recruitment, selection and employee retention, 2(1), 513-543.

Siregar, B. A., & Dewi, S. (2022). A nexus between employee engagement and goal orientation to employee competence and performance: Evidence from Indonesia. The Journal of Asian Finance, Economics and Business (JAFEB), 9(10), 147-158.

Sopian, K., Hidayati, T., & Kusumawardani, A. (2022). Effect of work-life balance on employee engagement in increasing employee performance. American Journal of Humanities and Social Sciences Research2, 6(3), 156-162.

Sulistiana, I. N., & Darma, G. S. (2023). Digital leadership, work-life balance, compensation, job satisfaction, and employee engagement. Quantitative Economics and Management Studies, 4(5), 981-993.

Van Laar, E., Van Deursen, A. J., Van Dijk, J. A., & De Haan, J. (2017). The relation between 21st-century skills and digital skills: A systematic literature review. Computers in human behavior, 72(1), 577-588.

Weng, T. C., Shen, Y. H., & Kan, T. T. (2023). Talent sustainability and development: How talent management affects employees’ intention to stay through work engagement and perceived organizational support with the moderating role of work–life balance. Sustainability, 15(18), 13508-13520.

Widiarti, N. S. A., Utami, C. W., & Bernardus, D. (2025). Driving sme performance through digital and network capabilities: The mediating role of innovation. Jurnal Ilmiah Manajemen Kesatuan, 13(5), 3727-3740.

Wood, J., Oh, J., Park, J., & Kim, W. (2020). The relationship between work engagement and work–life balance in organizations: A review of the empirical research. Human Resource Development Review, 19(3), 240-262.

Xuecheng, W., Iqbal, Q., & Saina, B. (2022). Factors affecting employee’s retention: Integration of situational leadership with social exchange theory. Frontiers in psychology, 131(1), 872105.

Yadnya, I. D. G. S. A., & Khamiliyah, L. (2024). The influence of human resource practices, inclusive leadership, and digital competence on employee engagement and retention in the hospitality industry: A SEM-PLS approach. Journal of Tourism, Hospitality and Travel Management, 2(1), 27–42.

Zia, A., Memon, M. A., Mirza, M. Z., Iqbal, Y. M. J., & Tariq, A. (2025). Digital job resources, digital engagement, digital leadership, and innovative work behaviour: A serial mediation model. European Journal of Innovation Management, 28(8), 3192-3216.