Impact of Leadership Styles on Employee Engagement and Performance in the Public Sector

Abstract

This study aims to examine the influence of transformational and transactional leadership styles on employee engagement and performance in the public sector, emphasizing the mediating role of employee engagement. Leadership styles have a profound effect on organizational outcomes. While transformational leadership is linked to higher employee motivation, transactional leadership focuses on structured rewards and punishments. Understanding their impacts on employee performance is critical, especially in public sector organizations. A quantitative research design was used, employing survey questionnaires distributed to employees in various public sector organizations across Pakistan. Data from 568 respondents were analyzed using partial least squares structural equation modeling (PLS-SEM) to test the hypotheses. Both leadership styles significantly influence employee performance, with employee engagement acting as a mediator. Transformational leadership exhibited a stronger positive effect on engagement and performance compared to transactional leadership. Public sector organizations should prioritize developing transformational leadership qualities through targeted programs to enhance employee engagement, motivation, and overall performance.