Sustainable HRM, training for employability and organizational outcomes: the moderating role of competitive intensity

Mattia Martini (Department of Business and Law, University of Milan–Bicocca, Milan, Italy)
Egidio Riva (Department of Sociology and Social Research, Università degli Studi di Milano - Bicocca, Milan, Italy)
Elisabetta Marafioti (Department of Business and Law, University of Milan–Bicocca, Milan, Italy)

Employee Relations

ISSN: 0142-5455

Article publication date: 18 July 2023

Issue publication date: 18 December 2023




The present study connects the literature on sustainable HRM with that on employability to investigate the relationship between sustainability-oriented human resource actions and organizational outcomes. More specifically, this study explores how training for employability affects the employer–employee relationship and employee retention. Furthermore, this study considers competitive intensity as a potential moderator in these relationships.


The analyses draw on the fourth European Company Survey (ECS 2019) with a sample of 21?869 firms with more than ten employees. Two separate logistic regression models were used to test the hypothesis.


The results show that training for employability contributes to improving the employer–employee relationship and that competitive intensity positively shapes this relationship. Contextually, training for employability reduces the overall employee retention of the firm.


Although this study supports the potential win–win nature of employability support, especially for companies that operate in competitive markets and an uncertain environment, it also highlights the existence of paradoxical sustainability tensions that should be managed by employers.



Martini, M., Riva, E. and Marafioti, E. (2023), "Sustainable HRM, training for employability and organizational outcomes: the moderating role of competitive intensity", Employee Relations, Vol. 45 No. 7, pp. 79-102.



Emerald Publishing Limited

Copyright © 2023, Mattia Martini, Egidio Riva and Elisabetta Marafioti


Published by Emerald Publishing Limited. This article is published under the Creative Commons Attribution (CC BY 4.0) licence. Anyone may reproduce, distribute, translate and create derivative works of this article (for both commercial and non-commercial purposes), subject to full attribution to the original publication and authors. The full terms of this licence may be seen at

1. Introduction

Sustainable human resource management (HRM) is an emerging approach to HRM that focuses on designing organizational and HR processes to embrace the principles of sustainable development and improve the working conditions and welfare of employees (De Prins et al., 2014; Ehnert et al., 2014). The growing importance of adopting sustainable HRM practices is widely recognized because they might lead to a “win–win” situation for employers and employees. By adopting sustainable HR practices, organizations signal their consideration of employees as a long-term investment rather than just a financial cost (Dixon–Fowler et al., 2020). In doing this, organizations can perform better through improved employment relationships, engagement and employer branding (see, e.g. Jeronimo et al., 2020; Lombardi et al., 2020; Onkila and Sarna, 2021; Sorribes et al., 2021).

Sustainable HRM means striving to meet the emerging needs of employees, including security and continuity of employment (De Prins et al., 2014). Sustaining employability and then equipping employees with skills and abilities that help individuals to obtain, retain and develop employment opportunities within and between employers (see, e.g. Forrier et al., 2015; Van der Heijde and Van der Heijden, 2006) represents an action of sustainability-oriented social responsibility (Ehnert et al., 2014; Jarlstrom et al., 2018; Kwan, 2019). Thus, by enhancing employability, employers help their employees face work uncertainty and create the conditions for them to realize sustainable careers with a long-term vision (De Vos and Van der Heijden, 2017; De Vos et al., 2020).

Despite the growing attention focusing on employability at the organizational level, to date, it remains unclear whether its development generates benefits for employers in a win–win logic. On the one hand, training and development opportunities are highly appreciated by employees and could be an effective strategy to attract and retain talent and improve employee commitment and performance on the job. Contextually, investment in employability may increase the value of employees and their chances in the external labor market, which in turn could increase the risk for employers of employee turnover (Nelissen et al., 2017; Rodrigues et al., 2020). Accordingly, although research demonstrates that employability exerts a positive effect on employees and organizational outcomes (Arocena et al., 2009; De Cuyper and DeWitte, 2011; De Cuyper et al., 2011), the debate about the existence of an “employability paradox” remains open (Van Harten et al., 2020).

The present study explores the relationship between sustainable HRM and organizational outcomes by considering employability support as a specific sustainability-oriented action. The employer-employee relationship and the organization's retention capacity are considered in terms of organizational outcomes. While the former concerns the quality of the internal climate and detects the degree of trust and mutual commitment that exists between the employer and its employees (Lee et al., 2021), the latter refers to the organizational ability to retain workers and reduce involuntary turnover.

In addition, the present study investigates under which circumstances employability enhancement is an effective strategy for employers. The relationship between employee development and organizational outcomes may depend on contextual dimensions, such as country culture, industry characteristics, technology intensity and organizational size (Garavan et al., 2021). Accordingly, sustainable HRM, and employability enhancement in particular, could be an effective strategy in specific contexts, whereas it may not be in other contexts (or it may be less effective). In this regard, the current research is quite limited (see, e.g. Arocena et al., 2009) and does not establish when or in which circumstances investing in employability is of interest to employers (Fugate et al., 2021). However, recent studies also reveal that competitive intensity, and then the intensity of competition a firm faces in its environment (Spanos and Lioukas, 2001), may moderate the relationship between sustainable HRM, development practices and organizational outcomes (see Haar et al., 2022; Zhang et al., 2020).

Thus, by using data from the fourth European Company Survey (2019), the present study investigates (1) how training for employability affects the employer–employee relationship and employee retention and (2) the role of competitive intensity as a potential moderator in the relationship between training for employability and organizational outcomes. This paper contributes to the current literature in several ways: First, it adds evidence to the emerging literature on the relationship between sustainable HRM and organizational outcomes and its potential mutual gains (Jeronimo et al., 2020; Onkila and Sarna, 2021). Furthermore, the study focuses on training for employability as a specific sustainable HR practice that deserves to be investigated as the labor market becomes ever more flexible and unstable (Fugate et al., 2021; Van der Heijden et al., 2021). This research provides additional evidence regarding the relationship between employability support and organizational outcome (see, e.g. Acikgoz et al., 2016; Akkermans et al., 2019; Philippaers et al., 2017, 2019; Rodrigues et al., 2020). Furthermore, the study focuses on the employer perspective, which is often ignored or addressed only qualitatively in previous works (see, e.g. De Vos et al., 2015; Marzec et al., 2009; Scholarios et al., 2008; Ybema et al., 2020). The study then adopts a contingent approach by considering competitive intensity in the business environment as a possible moderator of the relationship between training for employability and organizational outcome. Finally, the study uses data collected from a large, cross-national sample of companies, which guarantees the robustness and generalizability of the results.

2. Theoretical framework and hypotheses

2.1 Sustainable HRM and the development of employability

The sustainability of an organization's HRM has become increasingly important, and several definitions of sustainable HRM currently exist (Aust et al., 2020). The most common conceptualization of sustainable HRM emphasizes the integration of economic, environmental and social goals into organizational strategies and practices (De Prins et al., 2014; Jackson et al., 2011). More specifically, sustainable HRM has been defined “as the adoption of HRM strategies and practices that enable the achievement of financial, social, and ecological goals, with an impact inside and outside of the organization and over a long-term time horizon while controlling for unintended side effects and negative feedback” (Ehnert et al., 2014). Following this definition, sustainable HRM is proposed as an alternative approach to strategic HRM that goes beyond the organizational financial purposes, including human, social and environmental outcomes (Aust et al., 2020). In addition, sustainable HRM is seen as a strategy that enables organizations to achieve win–win–win performance in terms of the shared values of “people, profit, and planet” (De Prins et al., 2014; Jackson et al., 2011; Porter and Kramer, 2011).

In light of sustainability, enhancing worker employability is an employer's responsibility (De Prins et al., 2014; Jarlstrom et al., 2018; Zhang et al., 2015). Indeed, sustainable HRM underlies a long-term perspective on the employment relationship (De Prins et al., 2014; Ehnert et al., 2014), which requires taking into account the expectations of internal stakeholders, including job security, well-being and quality of life (De Stefano et al., 2018). Employability refers to the ability of employees to perform adequately in their current and future jobs (Fugate et al., 2021; Van der Heijde and Van der Heijden, 2006), thus increasing their chances of finding a job in the internal and external labor market (Forrier et al., 2015). In a context where work is becoming more uncertain and careers are dynamic and unpredictable, supporting employability responds to employees' need for employment security over time (Bernstrøm et al., 2019). For companies that cannot reasonably offer job security, employability means increased investment in company-funded employee development to ensure that employees' skills are up-to-date and marketable in the event of unexpected unemployment (Hirsig et al., 2014; Benson, 2006). In doing this, employers increase their employees' chances of realizing sustainable careers (De Vos and Van der Heijden, 2017) and contribute to workers' well-being and their quality of life (Berntson and Marklund, 2007; De Cuyper et al., 2011; Lu et al., 2016).

For several years, the HRM literature has investigated the motivation of employers to invest in employability development. However, most scholars adopted a strategic HRM perspective and emphasized the importance of having an employable workforce to achieve functional flexibility and cope with organizational changes (Fugate et al., 2021). In this vein, the rationale is that employers make investment decisions regarding employability with the goal being to increase competitive advantage and ensure organizational continuity over time. Accordingly, employers mainly focus on internal employability by strengthening the skills that serve the current or prospective jobs within the organization (De Vries et al., 2001; Baruch, 2001; De Vos et al., 2015; Scholarios et al., 2008).

However, in the light of sustainability, the rationale behind employers' employability support is to reach economic and social outcomes by creating value for both the organization and the employees (Aust et al., 2020; Ybema et al., 2020; De Prins et al., 2014). To this end, employers should consider the expectations of the organization and the employees and balance their multi-faced development needs (Bonfiglioli et al., 2006). Furthermore, employers should redirect their investments towards the development of both internal and external employability and strengthen the skills that also transcend the job's and organizational boundaries to make the worker more valuable in the labor market (De Vos and Van der Heijden, 2017). Table 1 summarizes the main differences between strategic and sustainable HRM approaches to employability development.

Developing employability from a sustainable HRM perspective may represent a win–win strategy for the company and the employees. However, the literature on sustainable HRM underlines the existence of paradoxes that are due to the organization's attempt to jointly pursue economic, social and environmental performance (Podgorodnichenko et al., 2020). Importantly, a specific paradox is also identified concerning employability development (Nelissen et al., 2017; Rodrigues et al., 2020; Zhang et al., 2015). Investing in employee employability contributes not only to better organizational and social performance (e.g. functional flexibility, employment security, well-being) but also to increasing the attractiveness of employees in the labor market and to competing employers. Consequently, employability may reduce the company's ability to retain human capital, thus calling into question the long-term economic sustainability of the organization. Given that solving the potential conflicts of sustainability performance is not always possible (Podgorodnichenko et al., 2020), the existence of an employability paradox is thought to inhibit some organizations from developing and enhancing employability (Zhang et al., 2015).

2.2 Training for employability and organizational outcomes

Existent literature suggests that employability grows over time in the workplace as employees engage in different types of developmental activities aimed at enhancing employee suitability for work both inside and outside the organization (see, e.g. De Vos et al., 2011; Van Harten et al., 2016). Within employability support practices, training plays a key role (De Grip and Sanders, 2004; Forrier and Sels, 2003; Groot and Maassen, 2000). Indeed, training includes all the formal on- and off-the-job activities that focus on developing the knowledge, skills and abilities of employees in the workplace (Garavan et al., 2021), thus representing a privileged mechanism through which employees can strengthen their internal and external employability.

Previous studies have adopted a strategic HRM lens to explore the relationship between training and employability. In so doing, they considered training intensity (e.g. the amount of training and the duration of the training program), training method (e.g. formal training vs on-the-job training), training content (e.g. general vs firm-specific training) and time horizon (e.g. short-vs long-term training) as their independent variable (see, e.g. Forrier and Sels, 2003; Hodzic et al., 2015). Although these works all take into account the relevant dimensions of training, their results do not provide a clear and unambiguous conclusion regarding the role played by corporate training in employee employability (De Grip and Sanders, 2004; Groot and Maassen, 2000). Conversely, existent studies often overlook the reasons why employers decide to provide training to their employees that may play a key role in the individual's employability. Previous studies have also found that employers usually offer job-oriented training in the hopes of exclusively supporting internal employability (Baruch, 2001; De Vos et al., 2015). Accordingly, they invest primarily in the development of skills and abilities that enable employees to perform their job at a high level and eventually evolve professionally within the actual organization (Scholarios et al., 2008; Forrier and Sels, 2003).

However, from a sustainability perspective developing employability requires a broader approach to training (Ybema et al., 2020). To this end, employers should invest in training that also transcends employees' current jobs and that can prepare them for future occupations in both the internal and external labor market (Hirsig et al., 2014; Fugate et al., 2021). Accordingly, we define training for employability as the adoption of a sustainable HRM approach toward employability through which development is aimed at balancing the organizational and individual needs and at enhancing both workers' internal and external employability. Thus, training for employability requires providing development and training initiatives that equip employees with the skills needed to perform their job well and be appreciated in the internal labor market, but also with the capacities required in the future to find a new job with another employer and realize a sustainable career in the external labor market.

Through investment in structured training, organizations enhance both employee and organizational human capital, which in turn improves organizational performance (Arocena et al., 2009; Ybema et al., 2020). However, most of the literature on the relationship between employability and organizational outcomes focuses on the new psychological contract and social exchange theories (Fugate et al., 2021; Imam and Chambel, 2020). Psychological contract theory propounds that the traditional employment relationship in which employees exchange commitment and loyalty to a firm for a credible promise of long-term employment is now gone (Guest, 2004). In the new psychological contract, “employability” is likely to supplant long-term job security as the basis for a positive employer–employee relationship (Craig et al., 2002; Iles et al., 1996). Therefore, when employers invest in the employability of their employees, the psychological contract is reinforced, which builds morale and improves employee behavior on the job and toward their employer (Ellstrom and Nillson, 2012). Social exchange theory suggests that employer investments in employee employability contribute to creating a sense of indebtedness in employees, which may trigger positive attitudes and behavior in return (Cropanzano and Mitchell, 2005; Eisenberger et al., 2001). Accordingly, when an employer invests in employability, the employee feels obliged to give something in return, such as greater motivation, productivity and loyalty (De Cuyper and DeWitte, 2011).

Previous research reveals that employability support can benefit both the organization and the individual, thus enabling the first to reach positive economic and social outcomes. Existing work shows that employability development correlates positively to a variety of organizational performance factors, such as labor productivity (Arocena et al., 2009; Ybema et al., 2020), worker effort (De Cuyper et al., 2014; Philippaers et al., 2019; Van der Heijde and Van der Heijden, 2006), job satisfaction (De Cuyper et al., 2011; Gowan, 2012; Lu et al., 2016), commitment (Akkermans et al., 2019; Rodrigues et al., 2020) and organizational citizen behavior (Philippaers et al., 2019). Furthermore, empirical studies suggest that, by supporting employability, employers create social value for their employees because employability correlates positively with employee career satisfaction (De Vos et al., 2011), health and well-being (Berntson and Marklund, 2007; De Cuyper et al., 2011; Lu et al., 2016).

Nevertheless, the evidence on employability and organizational outcomes remains somewhat biased due to a substantial lack of empirical work in this field that considers the employer's perspective. Building on the assumptions of the social exchange theory and the mutual benefits of employability support, training for employability is expected to improve the quality of the employer-employee relationship within the organization. The employer-employee relationship is often assessed through managerial perceptions (see, e.g. Huselid, 1995; Delaney and Huselid, 1996) and is defined as the degree to which the employer and its personnel trust and are committed to one another (Lee et al., 2021; Tsui et al., 1997). Conversely, the employer-employee relationship relates strongly to the internal organizational climate and different employee and organizational performances also depend on it (Boyle, 2006). Accordingly, we form the following hypothesis:


Training for employability improves the employer–employee relationship.

In line with the foregoing, employees may reciprocate the employer's support with greater loyalty to the company (Rodrigues et al., 2020). In this way, training for employability may help retain talent. In addition, developing employability from a sustainability perspective also means equipping employees with a set of knowledge, skills and abilities that are in high demand by employers and thus render the employee more attractive in the labor market. Furthermore, the more employable employees are, the more likely they are to accept job opportunities (De Vos et al., 2011), which means that they will be less committed to their employer (De Cuyper and DeWitte, 2011) and more likely to leave the organization (De Cuyper and DeWitte, 2011; De Cuyper et al., 2011; Nelissen et al., 2017).

Following the discussion above, employer investment in the employability of their employees may incur the risk of increasing turnover and thereby make it harder to retain the most qualified employees. However, recent studies conducted on the individual level and that focus on how employability investment affects employee attitude and behavior on the job have confirmed the assumptions of social exchange theory (Akkermans et al., 2019; Moreira et al., 2020; Rodrigues et al., 2020; Soares and Mosquera, 2021). In particular, they report that, when the employer is concerned with enhancing the employability of its employees, the latter, even the most employable, return the favor with greater commitment and greater loyalty to the employer. Accordingly, based on the social exchange assumptions and previous empirical results, we form the following hypothesis:


Training for employability increases employee retention.

2.3 Moderating effect of competitive intensity

In organizational settings, the performance outcome of HR development depends on the level of congruence between the HRM initiatives and both the external and internal context (e.g. national and local institutions and cultures, competitive mechanisms, size, sector, strategic objectives) (Garavan et al., 2021). From this perspective, researchers have recently given greater consideration to the business context in HRM, with evidence suggesting that the business environment, and in particular the intensity of the competition within a sector, shapes the relationship between HR practices and organizational outcomes (Wu et al., 2005), including acting as moderator (Haar et al., 2022).

Competitive intensity identifies the degree of competitive actions in the industry, where high competitive intensity is usually characterized by cutthroat competition, promotion wars, similar products and severe price competition (Zhang et al., 2020). In our specific context, we argue that a dynamic business environment shapes the relationship between employability development and organizational outcomes. Note that Goshal et al. (1997) conceived employability as a valuable strategy for firms facing competitive environments because it reduces the risks of skill obsolescence and contextually enhances employer and employee flexibility to cope with discontinuous changes in the environment. However, other mechanisms may exist through which competitive intensity influences the relationship between sustainable HRM, training for employability and employee attitude and behavior toward their employer.

First of all, companies that cannot offer adequate job security should invest more in the employability of their employees (Benson, 2006) because, when employment becomes unsure, employability takes over as the element of exchange in the new psychological contract (De Cuyper and De Witte, 2010). Thus, any employer investment in employability may be particularly appreciated by employees in more competitive industries because they may suffer from greater job uncertainty and thereby require continuous updating of skills to remain competitive (and employable) in the external labor market. Thus, competitive intensity affects labor market outcomes and increases job insecurity (Aparicio-Fenoll, 2015), and the possible consequences of greater competition are industry and occupational decline, shrinking demand and a higher probability of firing and of HR outsourcing (Shoss, 2017). Consequently, if a firm that operates in competitive markets invests in employability to reduce the uncertainty among their employees of finding another job if need be, then employees are more likely to feel satisfied and committed and to remain with the organization (Galunic and Anderson, 2000).

Furthermore, companies operating in markets where competition is particularly fierce need to invest more in human capital to be competitive in attracting, motivating and retaining talent. Haar et al. (2022), for example, have shown that the relationship between high-performance work systems and innovation is moderated by competitive rivalry. In particular, the authors found that increasing investments in HR training and development allowed companies operating in more competitive environments to acquire and dispose of higher-level human capital. The corporate sustainability literature also suggests that sustainable HRM can be a valuable strategy in competitive environments (Zhang et al., 2020; Dupire and M’ Zali, 2018; Aziz et al., 2021; Woo et al., 2022). By adopting sustainability-oriented HR strategies, a company can improve its reputation and goodwill with external and internal stakeholders (Fernando and Lawrence, 2014) and differentiate its image from that of its competitors. Given that reputation and image influence not only customers and their purchasing choices but also the employment relationship and the overall perception of employees towards their actual and prospective employer, sustainable HRM represents a differentiating lever that allows a company to gain a competitive advantage in the labor market (Chaudhary, 2019). Consequently, companies in competitive environments may benefit the most from training for employability.

According to the discussion above, we expect competitive intensity to amplify how training for employability affects employer–employee relationships and employee retention. Thus, we form the following two hypotheses:


Competitive intensity interacts with training for employability and improves the employer–employee relationship.


Competitive intensity interacts with training for employability and increases employee retention.

3. Data and methods

3.1 Sample

Our analyses focus on the fourth ECS 2019 (European Foundation for the Improvement of Living and Working Conditions, European Centre for the Development of Vocational Training, 2020), which gathered data on a wide range of HRM practices and strategies implemented in a large and representative sample of organizations (N = 21,869) with ten or more employees in production, construction and services (NACE Rev.2 categories of sector activity B to S) across the 27 EU member states and the United Kingdom. This study uses information collected through the online questionnaire for management respondents. Table 2 reports the sample characteristics.

3.2 Measures

Because objective indicators of organizational outcomes were not collected by the ECS 2019, the present study measures the dependent variables through managerial perceptions. Although perceptual data typically introduce some limitations, managerial evaluations proved to be consistent with objective organizational outcomes (Dess and Robinson, 1984) and are thus widely used to assess the effectiveness of HRM practices (e.g. Huselid, 1995; Delaney and Huselid, 1996; Perry-Smith and Blum, 2000).

The ECS 2019 includes two items that allow researchers to assess a company's employer–employee relationship and the employee-retention capacity. To assess the employer–employee relationship, the present study uses the question “How would you describe the relations between management and employees in this establishment in general?” Responses, originally ranked on a five-point scale, were dummy recoded (0 = very bad, or bad, or neither good nor bad; 1 = good or very good). Furthermore, ECS 2019 asked managers to assess employee retention through the question “How difficult is it for this establishment to retain employees?” Responses were dummy -recoded (0 = very or fairly difficult; 1 = not at all or not very difficult). The design of these two items is consistent with that of questions used in previous studies and belongs to the broader spectrum of perceived organizational outcomes (e.g. Huselid, 1995; Delaney and Huselid, 1996).

As conceptualized herein, training for employability measures the employers' sustainable support of employability development. In this vein, training for employability encompasses the employer's target and reasons to provide training to their employees (Baruch, 2001; De Vos et al., 2015; Scholarios et al., 2008; Forrier and Sels, 2003). ECS 2019 asked employers “How important are the following reasons for providing training to employees in this establishment?” and the responses consisted of the following four items: (1) ensuring that employees have the skills they need to do their current job; (2) allowing employees to acquire skills they need to do other jobs than their current job; (3) increasing the capacity of employees to articulate ideas about improvements to the establishment; and (4) improving employee morale. Items were recoded in four categories ranging from 1 = not at all important to 4 = very important. Each item detects different dimensions of training for employability (Forrier and Sels, 2003). More specifically, items (1) and (3) highlight a focus on internal employability through investments in skills that help employees to do their jobs well, be appreciated and advance their internal career. Item (2) detects an employer's focus on both internal and external employability through the development of skills that help employees to cope with changes in their jobs within and outside the actual organization. Finally, item (4) measures the employer's concern with individual development needs when developing training initiatives for their employees. Thus, we compute a composite measure that includes the four items so that higher scores indicate a greater sustainable orientation toward employability. Factor analysis was then applied to reduce data and, based on the eigenvalues-greater-than-one rule, only one factor was retained. The results indicate that the four items correlate strongly (Cronbach's α = 0.708). Table 3 lists the factor loadings and unique variances. Scores for this factor ranged from −3.398 to 1.243 (M = 3.55 × 10–9; standard deviation = 0.0815).

Competitive intensity has been conceptualized as a firm's evaluation of the intensity of competition it faces regarding price, innovation, human capital, access to distribution channels, etc. The ECS 2019 provides a single-item question that is consistent with the measures previously employed (Spanos and Lioukas, 2001; Haar et al., 2022) and that detects the competitive intensity of the company's target market with regard to the products or services that it offers. More specifically, management respondents were asked the following question, which was used as a proxy for competitive intensity: “How competitive would you say the market for the main products or services provided by this establishment is?” Response categories were dummy coded (0 = not at all or not very competitive; 1 = fairly or very competitive).

The following broad range of control variables was included in the models: sector of activity (NACE Rev.2, 1 digit) and establishment size class; concerning the workforce profile: the percent of employees with an open-ended contract (recoded in five categories ranging from 1 = less than 20% to 5 = 80% or more) who were managers working part-time. As for HRM workplace policies and practices, we controlled for a set of items measuring internal career opportunities (“When recruiting, how often does management start by looking whether there are any suitable internal candidates?” coded in five categories ranging from 1 = always to 5 = never), the percent of employees receiving variable pay linked to individual performance (recoded in five categories ranging from 1 = less than 20% to 5 = 80% or more), the percent of employees who could independently organize their own time and schedule their own tasks (recoded in five categories ranging from 1 = less than 20% to 5 = 80% or more). and the percentage of employees who were in training sessions during paid working time (recoded in five categories ranging from 1 = Less than 20% to 5 = 80% and more). Other selected covariates were the percent of employees whose job included finding solutions to unfamiliar problems (recoded in five categories ranging from 1 = less than 20% to 5 = 80% or more), management assessment of employee motivation (dummy coded as 0 = very or fairly motivated; 1 = not at all or not very motivated), whether any industrial action directly related to an issue specific to the establishment took place since 2016 (0 = no; 1 = yes), whether the establishment made a profit in 2018 and the country of the firm.

3.3 Methods

To predict the rating of the employer–employee relationship and of employee retention by training for employability and to test the moderating effect of competitive intensity, we estimated two separate logistic regression models (one for each dependent variable) in STATA 17. These included, in a first step, the main effects and, in a second step, an interaction between training for employability and competitive intensity. Each model was adjusted for selected covariates and, in turn, for the remaining variable between employer–employee relationship and employee retention. Observations with missing values for any relevant variables were omitted from the estimation sample. Margins, which gave the average predicted probabilities of both employer–employee relationship and employee retention for specified values of training for employability in different establishments, were calculated and visually displayed by using the “marginsplot” command in STATA 17 to make the results easier to understand (Williams, 2012).

4. Results

First, we fit three separate models to predict employer–employee relationship and employee retention by training for employability only. The results (Table 4) indicate that, after adjusting for the selected covariates, a strong, positive and significant effect exists for employability training on the rating of employer–employee relationship (0.399, p < 0.001). Accordingly, Hypothesis 1 is confirmed. The effect of training for employability on employee retention is negative and statistically significant, although weak (−0.066, p < 0.05). Thus, Hypothesis 2 is supported, too.

Subsequently, to test the moderating effect of competitive intensity on the relationships under scrutiny, we ran the full models, which included the interaction terms. Figure 1 visually displays the moderating effects after adjusting for covariates held at their actual values (see Table 4, too). The graphical representation shows in more detail the training-for-employability slope for different levels of competitive intensity for the two relationships investigated. Parameter estimates suggest that the association between training for employability and employer–employee relationship is moderated by competitive intensity such that higher levels of competitiveness in the market for the main products or services provided by the organization results in a stronger relationship. In fact, the interaction term is positive and statistically significant (−0.183, p < 0.05), so Hypothesis 3 is validated. However, no significant evidence suggests that the slope of the relationship between training for employability and employee retention changes significantly as a function of competitive intensity. Thus, no evidence exists for the moderating effects anticipated in Hypothesis 4.

As for the control variables that were included in the full models, parameter estimates indicate a positive and statistically significant relationship between employer-employee relationship and: a high percentage (>80%) of employees in training sessions during paid working time (0.179, p < 0.05), the lack of difficulty in retaining employees (0.756, p < 0.001), a high percentage (>40%) of employees working part-time (0.218, p < 0.005), internal career opportunities, employment engagement (1.897, p < 0.001), a profitable establishment (0.332, p < 0.001), the small size of the establishment. Moreover, results suggest a positive and statistically significant relationship between employee retention and: the good or very good quality of employers-employee relationship (0.746, p < 0.001), the small size of the establishment, a high percentage (>80%) of employees in training sessions during paid working time (0.126, p < 0.05), a high percentage (>60%) of permanent employees (0.148, p < 0.005), a high percentage of managers (0.132, p < 0.005), a low proportion (<40%) of part-timers, higher percentages of employees independently organizing their own time and scheduling their own tasks, motivated employees (0.658, p < 0.001), a profitable establishment (0.209, p < 0.001).

5. Discussion

The goal of the present study is to explore the relationship between sustainable HRM and organizational outcomes. In so doing, the research explores how corporate training aimed at supporting employability affects the employer–employee relationship and employee retention. Contextually, by adopting a contingent approach, the study considers the role of competitive intensity in the economic environment as a possible moderator of the relationship between training for employability and organizational outcomes.

We now discuss the results of the study in terms of their theoretical implications and contributions to the literature.

First, the results highlight a positive relationship between sustainable HRM and the employment relationship. More specifically, the results suggest that, by adopting a sustainable approach to employability that takes into account the employees' development needs and focuses on both internal and external employability, the employer improves the overall quality of the employer–employee relationship within the organization (HP1). Thus, the results support the assumptions of the psychological contract and social exchange theories, which suggest that, when an organization is committed to sustainability, it gets something in return from its employees (Dixon–Fowler et al., 2020). Moreover, in the new psychological contract, employees expect the employer to be concerned about their employability. When this occurs, a positive effect for the employer is an improved internal climate and improved behavior of employees toward the employer. These results are consistent with the few works that have investigated the relationship between employability development and organizational performance from the employers' perspective (Arocena et al., 2009; De Vos et al., 2015; Marzec et al., 2009; Scholarios et al., 2008; Ybema et al., 2020).

This study also highlights the role of the competitive environment and in particular the degree of rivalry within the sector, in shaping the relationship between sustainable HRM practices and organizational outcomes. The empirical results confirm HP3 and reveal that training for employability has a positive impact on the employer–employee relationship that is greater for companies that operate in more competitive environments. From this point of view, investing in employability seems to be an effective strategy, especially for companies that operate in more dynamic and unpredictable economic environments. In this context, job security is typically lower, and the employees need to remain competitive in the external labor market to face with confidence the increased employment uncertainty (Bernstrøm et al., 2019). Thus, under these circumstances, employability becomes central to the employment exchange relationship (Fugate et al., 2021) and is a dimension in which employers should invest to improve the quality of the employer–employee relationships within the organization.

Conversely, the results do not confirm HP2, so training for employability does not increase employee loyalty and, consequently, does not improve the organization's overall retention capacity. On the contrary, the results suggest that, by offering holistic training oriented toward employability, employers can trigger greater difficulties in retaining their workforce. Employers that invest in highly valuable and transferable skills may reinforce the overall marketability of employees in the external labor market. Thus, more-employable employees may receive interesting job offers and thus become more likely to leave their current employer. Although the literature on the employability–turnover relationship is limited and presents mixed results, recent studies report a positive relationship between perceived external employability and employee turnover intentions (Acikgoz et al., 2016; Baranchenko et al., 2020; De Cuyper and DeWitte, 2011; De Cuyper et al., 2011; Nelissen et al., 2017). Furthermore, in this case, the characteristics of the competitive environment do not soften the negative effect of training for employability on employee retention. Thus, the results do not support HP4, which foresees a moderating role of competitive intensity in the relationship between employability support and employee retention.

The results confirm paradoxical sustainability tensions and conflicts (Podgorodnichenko et al., 2020; Bush, 2020). For the case of training for employability, although a company can improve the well-being and the quality of life of its employees by adopting a sustainable HRM approach to employability, it may also reduce employee retention, thus questioning the organization's long-term economic sustainability. More specifically, the present study suggests that, although investing in employability benefits employers in terms of an improved employment relationship, they also risk losing their more-employable staff to competitors. Thus, the results also confirm the employability paradox (Acikgoz et al., 2016; Benson, 2006; De Cuyper and DeWitte, 2011; Nelissen et al., 2017; Rodrigues et al., 2020). Contextually, the study indicates that the percentage of employees in training sessions during paid working time, which is included in the analysis as a control variable, produces no significant effect on employee retention. While this might partly explain the discordant results obtained by previous studies on the employability paradox, it also highlights the importance of considering the reasons for providing training, together with measures of training intensity, for exploring the relationship between employability development and employees' organizational behavior.

Previous studies suggest that the risk of turnover linked to employability increases only when employers invest insufficiently in their employees (Acikgoz et al., 2016). In fact, employable employees are more likely to leave their jobs when the value of their knowledge, skills and abilities is not fully recognized and consequently not adequately rewarded by the employer. For example, Acikgoz et al. (2016) reported that employable employees are more likely to change workplace when their affective commitment toward the employer is low and, contextually, their perceived job security is particularly high. Accordingly, to face the sustainability and employability paradox and render employability development an effective win–win strategy, employers should implement a holistic approach to sustainable HRM (Podgorodnichenko et al., 2020) and adopt a set (a bundle) of sustainable HRM practices, rather than single initiatives, to meet the multiple needs of their employees. In this perspective, employers should provide a total reward system that includes not only training support but also salaries, working conditions and career opportunities and discourage their employees, especially the more-employable ones, to leave the organization for other (and maybe better) jobs.

5.1 Limitations and future research

Although the results of this study are certainly interesting, they must be interpreted with several methodological limitations in mind.

The first limitation is related to the cross-sectional data that are not adequate to establish cause–effect relationships between variables (Bollen and Pearl, 2013). Moreover, this research followed a post-predictive design to study the HR–performance link (Wright et al., 2005) because the effect on the past performance of predictor variables was studied. Although the data do not allow us to conclude about causality, we are interested in evaluating the plausibility of the hypothesized causal relationships, which could be more robustly investigated in future research by using longitudinal data. In particular, it would be interesting to explore the processes and tensions of the employability paradox over time by exploring how the adoption of sustainable HRM policies and practices influences the relationship between training for employability and organizational outcomes.

A second limitation concerns the use of single-item measures for the dependent variables, where researchers usually adopt multiple-item scales to assess organizational outcomes. However, single-item measures can be useful when the construct is unambiguous (Wanous et al., 1997) or when a holistic impression is informative (Youngblut and Casper, 1993). Single-item measures are also adequate when the aim is to grasp the opinion of an entrepreneur or HR manager about specific organizational performance (Petrescu, 2013), such as employer–employee relationship or employee retention. In these cases, single-item measures allow a respondent to “consider all aspects and individual preferences of the certain aspects of the construct being measured” (Nagy, 2002, p. 79) and thus provide a more “tailor-made” picture of the respondent's construct view.

A third limitation concerns how the independent variable was measured. Four items distinguishing different reasons to provide training to the employees compose the training for employability construct. Although the final factor identifies a broader approach or, conversely, a narrower approach to employability development, it might overlook other important reasons for providing training. For example, specific items should capture the extent to which training is designed for satisfying organizational and/or individual development expectations, or even to directly detect whether the training is oriented towards internal or external employability and, consequently, to detect which skills employers invest the most (Baruch, 2001; Forrier and Sels, 2003; Scholarios et al., 2008). In this regard, ad hoc data collection should be implemented in future research because it would allow us to distinguish and explain the specific objectives of employers for training provisions.

5.2 Conclusions

In summary, the results of the study suggest that the quality of the employment relationship is supported when employers adopt a sustainable HRM approach that consists of investing in the employability of their employees. In doing so, employees can experience greater employment security and employers, especially those operating in a more uncertain environment, benefit from an improved internal climate, with potential positive returns in terms of employee productivity and performance. Conversely, increasing employability also increases the attractiveness of employees to prospective employers, consequently reducing the overall employee retention capacity of the organization. To constrain these paradoxical sustainability conflicts and maximize the long-term returns from investments in employability, employers should adopt sustainable HRM systems, and not just specific practices, to enhance staff and retain their most valuable human capital.


Employer/employee relationship and employee retention by training for employability and competitive intensity (average predicted probabilities with 95% confidence intervals)

Figure 1

Employer/employee relationship and employee retention by training for employability and competitive intensity (average predicted probabilities with 95% confidence intervals)

Strategic versus sustainable HRM approach to employability development

Strategic HRM perspectiveSustainable HRM perspective
RationaleObtain superior performance at organizational levelCreate sustainable value for both the organization and the employee
AimFunctional flexibilityFunctional flexibility, employment security and sustainable careers
TargetOrganizational development needsOrganizational and individual development needs
FocusInternal employability—skills needed to perform the job or get another job within the organizationInternal and external employability—skills that also transcend the job and make employees more employable both inside and outside the organization
Expected outcomesEconomic performanceEconomic and social performance

Source(s): Authors own creation

Sample composition

ObsValid %
Mining and quarrying880.4
Electricity, gas1960.9
Water supply3441.57
Wholesale and retail trade4,5552.83
Transportation and storage1,3596.21
Accommodation and food service activities1,3166.02
Information and communication9054.14
Financial and insurance activities4522.07
Real estate activities3051.39
Professional, scientific and technical activities1,4806.77
Administrative and support service activities8633.95
Arts, entertainment and recreation7113.25
Other service activities1,4426.59
Any industrial action since 2016
In 2018 establishment made a profit
Broke even2,18610.00
Workforce profile
Open-ended contracts
60% and more18,76086.56
20% and more2,78012.71
40% and more2,73912.75
HRM policies and practices
Internal recruiting
Most of the time6,65330.63
Employees with extra-pay linked to individual performance
< 20%4,75022.63
Employees independently organizing their time and schedule
< 20%6,74931.53
Employees whose job include finding solutions to unfamiliar problems
< 20%1,5847.46
United Kingdom6973.19

Source(s): Authors own creation

Factor analysis (principal factors): training for employability

ItemObsSignItem-test correlationItem-rest correlationAverage interitem covarianceAlphaFactor1Uniqueness
Test scale 0.1920.708

Source(s): Authors own creation

Regression models

Employer/employee relationshipEmployee retention
Training for employability0.24314080.06963893.490.0000.10665110.3796306−0.08806290.0620687−1.420.156−0.20971540.0335896
Competitive intensity (ref. cat. Not at all or not very competitive)
Fairly or very competitive0.37545980.07366165.100.0000.23108580.5198338−0.41942750.0610955−6.870.000−0.5391726−0.2996825
Training for employability x competitive intensity0.18282870.07557872.420.0160.03469710.33096020.03376010.06558820.510.607−0.09479040.1623106
Employees in training during paid working hours
80% and more0.17915690.07207692.490.0130.03788870.32042520.12578340.05441232.310.0210.01913730.2324295
Employee retention (ref. cat. Very or fairly difficult)
Not at all or not very difficult0.75682790.051149814.800.0000.65657620.8570797
Employer/employee relationship(ref. cat. Very bad or bad, neither good nor bad)
Good or very good 0.74648160.050674314.730.0000.64716180.8458015
Workplace size (ref. cat. Small)
Industry (ref. cat. Mining, quarrying)
Electricity, gas0.09647610.40121680.240.810−0.68989430.8828466−0.01774510.357693−0.050.960−0.71881050.6833204
Water supply0.30014070.37428790.800.423−0.43345021.0337320.29792860.3374820.880.377−0.3635240.9593813
Wholesale and retail trade0.21135370.33554020.630.529−0.4462930.8690005−0.15182770.3003504−0.510.613−0.74050360.4368482
Transportation and storage0.34363360.3424771.000.316−0.3276091.014876−0.46605580.3050185−1.530.127−1.0638810.1317695
Accommodation and food service activities0.48000270.34760691.380.167−0.20129441.1613−0.68705550.3056274−2.250.025−1.286074−0.0880369
Information and communication0.6733070.35660761.890.059−0.0256311.372245−0.60703770.3101282−1.960.050−1.2148780.0008024
Financial and insurance activities0.17209850.37606840.460.647−0.5649820.9091789−0.08857180.3274055−0.270.787−0.73027480.5531312
Real estate activities0.33835150.40200620.840.400−0.44956621.1262690.03245810.34952310.090.926−0.65259460.7175108
Professional, scientific and technical activities0.51490210.3469511.480.138−0.16510941.194913−0.56139330.3060615−1.830.067−1.1612630.0384762
Administrative and support service activities0.6418730.35423251.810.070−0.052411.336156−0.56607520.3100345−1.830.068−1.1737320.0415812
Arts, entertainment and recreation−0.1993050.3637266−0.550.584−0.91219590.513586−0.11242510.3263214−0.340.730−0.75200330.5271532
Other service activities0.43270930.34705941.250.212−0.24751461.112933−0.26425070.3079462−0.860.391−0.86781420.3393128
Open-ended contracts (ref. cat. < 60%)
60% and more−0.15652630.0731657−2.140.032−0.2999285−0.01312410.14798540.05390182.750.0060.04233980.2536311
Managers (ref. cat. < 20%)
20% and more−0.09012730.0794865−1.130.257−0.2459180.06566330.13204880.05728362.310.0210.01977510.2443226
Part-timers (ref. cat. <40%)
40% and more0.21867660.08138852.690.0070.05915820.3781951−0.16054090.0578342−2.780.006−0.2738939−0.047188
Internal recruiting (ref. cat. Always)
Most of the time−0.23755280.0627354−3.790.000−0.3605119−0.1145937−0.06090670.0442073−1.380.168−0.14755140.0257381
Employees with extra-pay linked to ind. performance (ref. cat. None)
Employees independently organizing (ref. cat. None)
Employees whose job include finding solutions to unfamiliar problems (ref. cat. None)
Employee motivation (ref. cat. Very or fairly motivated)
Not at all or not very motivated1.8979390.054112835.070.0001.791882.0039980.65854340.050083313.150.0000.5603820.7567049
Any industrial action since 2016 (ref. cat. No)
In 2018 establishment made a profit (ref. cat. No)
Broke even0.09540010.09250991.030.302−0.08591590.27671610.039490.07518090.530.599−0.10786190.1868418
United Kingdom−0.54053860.191434−2.820.005−0.9157424−0.16533490.41859630.13294143.150.0020.1580360.6791566

Source(s): Authors own creation


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