Digital Transformation, Employee Burnout and Work Engagement: Examining the Mediating Role of Technostress in Pakistani Organizations

Abstract

Digital transformation has become essential for improving efficiency and service delivery in the banking sector, yet its effects on employee well-being and work engagement remain an important concern, particularly in developing-country contexts such as Pakistan. This study examined the effects of digital transformation on employee burnout and work engagement, with technostress as a mediating mechanism, among employees of public, private conventional, and Islamic commercial banks operating in Peshawar, Khyber Pakhtunkhwa. A quantitative, explanatory, and cross-sectional research design was adopted, and primary data were collected through a structured questionnaire using proportionate stratified sampling. A total of 460 questionnaires were distributed, of which 391 usable responses were retained for analysis. The data were analysed using IBM SPSS, while the mediating effects were tested through the Preacher and Hayes bootstrapping procedure using PROCESS Model 4 with 5,000 bootstrap samples. The findings showed that digital transformation had significant positive effects on technostress, employee burnout, and work engagement. Technostress significantly increased employee burnout but reduced work engagement. The mediation analysis further revealed that technostress partially mediated the relationship between digital transformation and employee burnout and competitively mediated the relationship between digital transformation and work engagement. These findings demonstrate that digital transformation has a dual effect on employees because it can improve engagement through greater efficiency while simultaneously creating technology-related pressure that increases exhaustion and weakens involvement in work. The study concludes that banks should support digital transformation with continuous training, user-friendly systems, technical assistance, manageable workloads, employee participation, and appropriate limits on after-hours digital communication to protect employee well-being and sustain work engagement.