AI-ENABLED HR ANALYTICS AND WELL-BEING OF EMPLOYEES: AN EVIDENCE FROM ISLAMIC BANKING SECTOR

Abstract

This paper looks at how AI-based Human Resource (HR) analytics impacts the wellbeing of employees in the Islamic banking sector in Pakistan. Based on the Job Demands-Resources (JD-R) and Self-Determination theory (SDT) paradigms, the study seeks to evaluate the effects of AI-enabled HR analytics on the wellbeing of employees. Quantitative design is used to gather data from 317 employees, where a structured questionnaire was distributed, and analyzed using PLS-SEM in SmartPLS 3. Findings showed a strong positively significant correlation between AI-driven HR analytics and employee well-being. Findings evidenced that AI systems improved fairness, transparency, and engagement, which proved that AI-based systems are organizational and psychological resources that help employees flourish. In practice, the research informs HR managers and policymakers about the use of AI ethically in order to increase efficiency and well-being. Theoretically, it progresses JD-R and SDT by placing AI as a motivational and technological tool. This study adds an empirical evidence to the existing knowledge on human-centered implementation of AI to enhance employee well-being in work environments that are ethically and technologically based, namely the Islamic banking sector in Pakistan