Psychological Contract Violation and Turnover Intention in the European Public Sector: Evidence from Fixed-Effects Panel Analysis
DOI:
https://doi.org/10.51137/wrp.ijarbm.455Keywords:
Psychological Contract, Turnover Intention, Public Sector Reform, Austerity, Employee Commitment, EuropeAbstract
In the context of widespread fiscal consolidation and structural reform across Europe, public sector organisations face increasing challenges in maintaining employee commitment and stability. This study investigates the impact of psychological contract violation (PCV) on turnover intention (TI) among public sector employees across 20 European Union countries, using data from the European Working Conditions Survey (EWCS). Employing fixed-effects logistic regression models as a robustness check alongside linear fixed-effects specifications, the analysis accounts for individual-level unobserved heterogeneity and controls for key institutional and demographic covariates. The findings reveal a strong and statistically significant positive association between PCV and TI, robust across specifications. Moreover, the effect of PCV is more pronounced in countries experiencing higher levels of austerity and public sector reform, suggesting a contextual amplification of contract breach effects under institutional strain. These results underscore the behavioural costs of administrative reform and highlight the importance of psychological contract management in public sector human resource strategies. Policymakers are urged to integrate employee support mechanisms into reform agendas, reinforce relational aspects of employment, and invest in transparent communication and participatory change management. Future research should explore longitudinal dynamics and sectoral variation to refine organisational responses to psychological contract disruptions.
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