International Journal of Social Science Research (IJSSR)

Exploring How AI-Enabled HR Practices and Workforce Diversity Impact Job Satisfaction in Chennai’s IT/ITES Sector: The Mediating Role of Employee Engagement

As Chennai’s IT/ITES sector continues to evolve at the intersection of digital innovation and human capital development, this research explores the combined impact of AI-enabled HR practices and inclusive workforce strategies on employee engagement and job satisfaction. Leveraging insights from 230 participants comprising both HR professionals and general employees, through a stratified purposive sampling method, the study analyzes the direct and mediating effects of HR technology and workplace diversity on key employee outcomes. Using validated tools, the Utrecht Work Engagement Scale (UWES-9) and the Job Satisfaction Survey (JSS), statistical analyses revealed that both AI-driven HR systems (β = 0.61) and workforce diversity (β = 0.64) significantly boost engagement levels. Engagement, in turn, emerged as a powerful mediating factor (β = 0.68) that links these organizational practices to improved job satisfaction. Specifically, 67% of AI's impact and 71% of diversity’s impact on satisfaction are channeled through engagement. These results emphasize the necessity of integrating smart HR technologies and promoting diversity and ensuring these efforts genuinely engage employees. In a sector fueled by constant innovation, achieving sustainable employee wellness and retention depends on the synergy between AI efficiency and inclusive organizational culture, which play a vital role in fostering motivation, fulfillment, and long-term performance.