With above 33% attrition, pvt banks find it tough to retain junior staff

Industry experts say that the resignations could be largely attributed to young employees taking a second look at their life decisions and career choices

Banks in India are witnessing a rise in attrition, especially among the junior levels, The Times of India (ToI) has reported. The trend is taking root as the demand for skilled talent is overtaking the supply. The balance sheets of top private banks reveal that the attrition rates have been rising steadily for the last two years.

The resignations could be largely attributed to the young employees taking a second look at their life decisions and career choices, industry experts said. MD and CEO of HDFC Bank, Sashidhar Jagdishan, told the newspaper that the rise in people leaving banking jobs may be because of the post-Covid phenomenon, which is likely to have prompted entry-level employees to reconsider their life goals. This phenomenon is not limited to the banking sector and affects several other sectors as well, said Jagdishan.

The attrition rate at HDFC Bank stood at 34.2 per cent, with the junior staff registering attrition at 39 per cent. The report cited data from Aon Consulting and said that the overall attrition rate in the banking sector was 24.7 per cent between January and September 2022.

Expressing his thoughts on the subject, MD and CEO of Axis Bank, Amitabh Chaudhary, told ToI that while people at senior levels are also leaving jobs, the attrition rates are higher at junior levels at 33-35 per cent. He said that the expansion of industry and the economy are producing ample job opportunities, which may be one of the reasons behind the high attrition rate. This is not a new phenomenon, Chaudary added.

The attrition among junior staff is particularly high in the banking sector. This is very likely a result of the increasing competition and the rise in opportunities in the NBFC and fintech space, the report said.

CEO of the general staffing business at TeamLease, Kartik Narayan, was cited in the ToI report as saying that the cleanup of bad loans in the banking sector has set the industry for aggressive growth, leading to a rise in demand for talent. Most recruitment is happening from Tier-1 and -2 cities with monthly salaries in the range of Rs 20,000-25,000, which makes it easy for rivals to poach employees with a 10-15 per cent pay hike, Narayan said.