High attrition rate hits services sector

Increasing opportunities and employee aspirations induced by robust economic growth have led to an unhealthy attrition rate, exceeding 20 per cent for India Inc, with services sector facing the maximum brunt, a study shows.

An Assocham Business Barometer Survey on 'Attrition problem in a growing economy' has revealed that attrition rate at 40 per cent is alarming in the services sector, while the same in manufacturing was 20 per cent.

Maximum attrition is taking place among employees in the age group of 26-30 years, while those with an experience of 2-4 years are most vulnerable to job-hopping, the survey covering 160 HR heads noted.

Interestingly, women employees were less prone to job changing compared to men.

"For every 10 males jumping the fence there were only two females crossing over. Even if women face the pressure of balancing the management of their families and workplace, they tend to be more stable than their male colleagues," 52 per cent of HR managers surveyed said.

With India joining the globalised world of business, the movement of workforce across national boundaries has also added to the rising level of employee turnover, according to 72 per cent of the ABB respondents.

The immediate gains in salary package was found to be responsible for job change in 61 per cent of the cases, growth potential was also rated quite high as an important reason.

Almost 90 per cent of the respondents said recruitment is an ongoing process throughout the year. The average increase in salaries offered with new placement ranges between 25-30 per cent depending on the salary structure and individual strengths.

Companies that are in the process of expanding face higher attrition rates compared to established firms, going by 65 per cent of the respondents.

Emergence of online job portals such as Timesjobs.com, naukri.com, monster.com and clickjobs.com have contributed to higher employee turnover, as agreed by 68 per cent of those surveyed.