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India Inc may see attrition rates as high as 31%

Employees unhappy with their performance review or salary hikes seek better opportunities

Press Trust of India  |  New Delhi 

India Inc is likely to see attrition rates as high as 31% during the three months ending June, as employees unsatisfied with annual salary hikes would look out for better prospects, say experts.

According to human resource experts, the average attrition rate is projected to grow at 31% in Indian firms in the April-June quarter, a rise of 9-10% from the preceding quarter (January-March).

In the April-June quarter of 2011-12, the average attrition rate was 27%.

Generally, employees would have received their annual appraisals during the April-June period and those not happy with their performance review or salary hikes seek better opportunities. Consequently, attrition rates are seen going up in these three months, experts opined.

"In the current quarter, we are expecting an average attrition rate of 30%. In Q4 employees were not keen to switch jobs due to appraisal season. Now in April they reached on higher salary compared to previous one and have a chance to negotiate for better salary with new employer along with new appraised designation," MyHiringClub.Com CEO Rajesh Kumar said.


Salary and designation are the major factors for higher attrition outlook in Q1, FY'13. One more concern is having in employees mind if they'll change their job in this quarter they are entitled to enter into appraisal cycle with their new employer also. So they are not going to loose anything with job change," he added.

Another HR consultant Ripples Consultancy Services CEO and MD Rishi Raman said. "We would see a high attrition rate of 30-31% in the first quarter of the current fiscal. The reason behind such attrition is many employees are not satisfied with their appraisals.

"A good performer did not expect 10-15% of hike, their expectation is not less then 20%," he added.

 Experts said that attrition would be in  double digits in all the sector. It would be highest in the IT /ITeS sector at 31%, followed by telecom (26%), banking and financial services (23%), aviation and hospitality (22% ), real estate (15%), FMCG (21%), automobile and manufacturing (19%).

HR consultants are of the view that employers needs to take various steps in order to retain talent like providing career opportunities and suitable work environment as high attrition impact the company's resource negatively.

"One of the most effective way to ensure good working conditions for your employees is to provide them with advancement opportunities," Raman said.

HeadHunter Solution Director Priyanka Pawar said," the high attrition costs increases the costs to the organisation considerably.

"The more the people  leave an organisation, the more it is a drain on the company's resources like recruitment expenses, training and orientation resources and the time. The high attrition rate also affects the productivity of the organisation," she added.

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First Published: Tue, May 01 2012. 19:08 IST
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