New Delhi: Rising level of opportunities and employee aspirations induced by robust economic growth has led to an attrition rate exceeding 20% with services sector facing the maximum brunt while an increasing number of personnel in the manufacturing sector are also found restive, according to a survey carried out by Assocham.
The ABB Survey on “Attrition problem in a growing economy” covered 160 leading HR heads.
*Maximum attrition is taking place among employees in the age group of 26 to 30 years.
* Segment of employees who are most vulnerable to change have 2-4 years of work experience.
* Women employee are less prone to frequent job changes than their male counterparts. For every 10 men changing their job, there are only two women doing the same.
* The increase in salary package was responsible for 61% of job switches.
* 90% respondents felt that recruitments are an ongoing process based on vacant positions.
* Average increase in salaries offered by companies with new placements range between 25 - 30% depending on salary structure and people skills.
* Growing companies face higher attrition rates as compared to established companies.
* Online job portals like Times Jobs, Naukri, Monster and Click Jobs have contributed to the high rate of attrition.
Most HR managers are of the opinion that the attrition level of 10-12% is healthy for a company. But they are not averse to the fact that high attrition levels can create their own share of problems like lower employee and investor confidence and falling productivity levels.
80% HR Managers felt that one of the major challenges arising out of attrition is loss of intellectual property, which is difficult to replace which is more pronounced in hospitality, IT, hospitals and engineering sectors. Also, costs associated with recruitment and training of new staff was quite high.
* 73% respondents felt that one of the ways to hold back employees was to chart out an organizational structure which promises career growth for the staff.
* 50% HR Heads admitted that they do not have a scientific way of appraisal and the employees get rewarded or punished by “extraneous” reasons.
* Appraisal systems within companies should make use of modern tools provided by information technology. These tools should quantify employee’s performance in terms of meeting targets, deadlines pressures, absenteeism etc.
* Companies should benchmark compensation levels and upgrade reward structures from time to time.
* 55% of HR professionals felt that it is possible for Indian companies to implement Maslow’s theory of motivation which takes care of employee’s physiological/ social needs, safety, self esteem and self-actualization needs.
Many Indian firms especially in KPOs, BPOs and within the IT sector have already started initiating social programmes involving families; counseling sessions; self development workshops, leadership programmes and training.