Author(s):
Farrukh Bashir*, Saira Bashir
Corresponding Author: farrukhbasheer@outlook.com

Abstract:

Employees’ perceptions of knowledge transferability – whether they believe their skills and knowledge are useful outside their current firm – may critically shape career moves such as entrepreneurial entry. This study examines how these perceptions interact with firm-initiated turnover (involuntary job loss) to influence the likelihood of an individual becoming an entrepreneur. Drawing on theories from entrepreneurship, human resource management, and organizational behavior, a framework is developed linking perceived human capital transferability, turnover type, and entrepreneurial outcomes. Recent global data from 2021–2025, including a large-scale longitudinal survey and supplementary international datasets, are analyzed to test the hypotheses. The results show that when workers who perceive their knowledge to be firm-specific (non-transferable) experience firm-initiated turnover, their propensity to enter entrepreneurship increases markedly. This effect is especially pronounced among individuals who had expected to remain with their employer (i.e. did not anticipate leaving). In contrast, those with highly transferable skills show relatively small differences in entrepreneurial entry following involuntary versus voluntary exits. Support is also found for underlying mechanisms: necessity-driven motives following job displacement and the mobilization of firm-specific expertise in new ventures. These findings enrich understanding of how self-perceptions of human capital and unexpected career shocks jointly drive entrepreneurial behavior. The paper concludes with implications for theory – positioning firm-initiated turnover as a form of organizational knowledge divestiture – and for practice, including how firms and policymakers can facilitate positive entrepreneurial outcomes for displaced employees.

Keywords:
Firm-initiated turnover (involuntary turnover), Knowledge transferability, Firm-specific human capital, Career shocks, Employee (spin-off) entrepreneurship, Perceived employability

Acceptance Date:
June 25, 2025

Copyright (c) 2025 Farrukh Bashir, Saira Bashir. Published by Falcons Journal of Advanced Research (FJAR).

This is an open-access article distributed under the terms of the Creative Commons Attribution 4.0 International License (CC BY 4.0) .