Absenteeism in the Banking Sector

CHAPTER 1

1.1 INTRODUCTION

Banks are the financial institutions that perform various tasks in the country. They are involved in long-term and short-term financing, they create money and provide many financial services to the people. According to oxford Dictionary, a bank is a foundation for charge of money, which is paid when customer orders it. Also, they deal in money, take the deposits, they give loans etc.

Banking sector mainly includes banks along with other finance providing institutions. Banking sector is the backbone of the business today and it mainly involves in the development of any country. All the financial transactions are being dealt by the banks. In Pakistan, banking sector is developing day by day and its network has expanded all over the Pakistan so it is one of the most important sector.

There are many problems to be faced now a days in the field of business like low performance, less skilled workers, management efficiency etc. One of those most important considerable problem is Absenteeism. Many workers are absent many days in a year to perform a task. Absenteeism is a big obstacle to deliver the services and it also affects the employees’ performance. It is not just the obstacle to banking sector but also a big factor that affects the employee’s work result, work flow, environment etc. In our banking sector, it is very important to generate good results and to enhance the performance. Business is basically done to earn profit but due to absenteeism, production level remains low and the costs are enhancing. So this problem should be controlled as early as possible for the efficient working of the business (Heads, 2005).

Absenteeism may be planned or it can also be unplanned. Planned absenteeism is the one that would already be known to the management whereas unplanned absenteeism would not be informed to the management and it reflects the wrong impression to the management and affects the performance of banks as well as the employee itself. An organization is judged by its performance (Corvellec, 1995). The word “performance” is utilized large area in all fields of management.

Absenteeism generally effects on firm’s and nation’s economy. The rate of absenteeism is generally enormous and increasing in developing countries and due to this impact on economic growth of the country is badly affected. The impact of absenteeism on firms or even a nation’s economy is very large, taking account of costs associated with it. For best understanding of determinants of absenteeism can be valuable for firms and policymakers (Stormer & Fahr, 2010).

Through this research, the problems of absenteeism will be identified in the banking sector of Pakistan, their impact will be shown on the performance of banks and suggestions will be given to overcome this problem for proper working of banks that are an important asset of country.

Today, businesses are competing to increase their productivity level and decrease the expenses as much as they can to maximize their profits. Absenteeism refers to not attending, missing or avoiding the work either intentionally or unintentionally. Its causes may include many factors like depression, disengagement, sickness, dissatisfaction, lack of motivation, low pay etc. It mainly depends on the attitude of the employees. Employee’s attitude will show that how much he / she is committed to the job. If the employee has a positive attitude then he / she will avoid taking leaves that are unnecessary. And the one that has poor attitude will misuse the leaves that are entitled to them, and it also effects the discipline and work efficiency of them (Naughton, 2005).