This study provides insight into employee retention issues in owner-operated small hospitality businesses in a university town. The study found that even though employee retention represents a managerial issue for the small hospitality businesses, it is not of significant importance to them. The restaurant managers/owners did employ various retention strategies for providing a good organizational culture but still accepted the transient nature of the student workforce. The findings suggest employee retention strategies to keep student employees while they study in the town's university. The paper also recommends the need for small hospitality businesses to work closely with hospitality education institutions to form a closer link between study and part-time employment, for example through internship, to alleviate the inherent problems of the transient nature of the student workforce. The paper provides the first major study in the New Zealand context, providing new insights into understanding employee retention among student workers in small hospitality businesses.