Volume 1 - Issue 4, November - December 2025

The IT sector in Sri Lanka is experiencing rapid growth yet faces a persistent challenge in retaining skilled software engineers. This research explores how specific work environment factors influence employee retention among software engineers in a selected IT company located in the Western Province of Sri Lanka. Grounded in a positivist, quantitative design, the research examines six variables collaborative culture, work-life balance, effective leadership, recognition, social connections, and access to modern technologies identified from the literature and mapped to the Sri Lankan context. Primary data were collected via a structured Likert-scale questionnaire from 201 software engineers. Findings from regression analysis provided that effective leadership, technology slacks, collaborative culture and work-life balance are considered statistical significant while recognition and social connection is identified to have no statistical significance. The study contributes sector-specific evidence for Sri Lanka, highlighting practical levers for retention; institutionalizing flexible work and workload management, developing transformational leadership capabilities, strengthening meaningful recognition, and ensuring timely access to up-to-date tools.