Abstract
The rise of hybrid and virtual work environments has reshaped traditional organizational dynamics, introducing complex challenges in sustaining employee engagement and identity. This study explores a central question: How do perceptions of proximity influence employee engagement through the psychological mechanisms of workplace isolation and social identity, and what role does self-efficacy play in this relationship? Grounded in Social Identity Theory, the research examines the serial mediating roles of workplace isolation and social identity in the link between perceived proximity and engagement, as well as the moderating role of self-efficacy on the social identity–engagement relationship. The study conceptualizes self-efficacy not as a distinct theoretical lens but as a personal resource that affects the strength of identity driven engagement within virtual contexts. A quantitative approach was adopted to investigate these dynamics. Quantitative data were collected from 470 hybrid and virtual employees across industries using pre-validated scales and analyzed using SPSS Process Model 87 and Covariance-Based Structural Equation Modeling (CB-SEM) in AMOS 24. To validate the robustness of the findings, qualitative insights were gathered through industry experts, involving 21 Senior HR Managers. The study extends SIT by illustrating how identity-based mechanisms function within digitally mediated workplaces, where both belonging and autonomy shape engagement. Practical implications highlight the need for identity-affirming leadership, structured social connection practices, and strategies to balance individual competence with collective identification in virtual organizations