The relationship between Human Resource Management practices and Labour Productivity in State Corporations in Kenya

Abstract

The prosperity of any nation depends on the personal performance and productivity of each individual because it indicates the extent to which a firm's labour force is efficiently creating output. The aim of this study was to establish the relationship between HRM practices and labour productivity in the public sector in Kenya. The HRM practices that were investigated were; performance and reward management, recruitment and selection, training and development and the moderating effect of employee engagement on labour productivity. The study adopted an explanatory research design which is suitable for studies that seek to determine relationships between variables. The study population constituted all the state corporations in Kenya, where a census method was used for data collection, targeting HR practitioners. Pilot testing was conducted to obtain some assessment of the questions validity and the likely reliability of the data. Data was collected using questionnaires and was analysed using descriptive and inferential analysis. Quantitative data was analyzed by use of statistical package of Social Sciences (SPSS). Structural equation modelling was used to analyse the survey responses and to test the relationships among the variables. It showed a good fit and possessed good reliability and validity and the results supported to a great extent the developed and predicted model. The findings showed that these HRM practices have a positive and significant effect on Labour productivity while Employee Engagement had an overall enhancing effect indicating a strong significant moderation effect on Labour productivity. When these HRM practices were bundled together, they had a significant effect on Labour productivity and were found to significantly contribute to Labour Productivity. Based on these findings, the study concludes HRM practices positively affect labour productivity, and it recommends that the public sector should transform from personnel management to Human Resource Management practices so as to ensure high Labour productivity.