Friday, November 10, 2006
India Inc sees higher attrition in Asia
October 11, 2006 -Mumbai, India Express
Indian companies are battling higher attrition rates than their Asian counterparts. India Inc faced a 20 per cent attrition rate in 2005, against 14.5 per cent in 2004, while companies in Asia saw 16 per cent attrition in 2005, up from 14 per cent in 2004, according to Hewitt's Attrition and Retention Study Asia Pacific 2006.
Outside firms paying higher salaries is the main reason employees quit their organisations in Asia. The study says 21 per cent of Asian firms cited external inequity of compensation as a prime reason for employees changing company. Limited growth opportunities and role stagnation ranked second and third respectively.
In this count also, Corporate India faces more heat — 59 per cent of Indian firms cited bigger pay packets as a reason for their staff leaving.
Andrew Bell, head of Hewitt's talent and organisation consulting practice in Asia, said, “In high-growth markets, it’s now easier for employees to move from one company to another, and so the complexity and cost of keeping the right people in an organisation increases.”
Turnover was highest at the professional/supervisor/technical level at 39 per cent of the total attrition and lowest among senior/top management at just 0.5 per cent. Interestingly, attrition among employees identified as high performers was much lower, indicating that most organisations are successfully retaining top performers.
The study says the Asian banking and finance sector saw the greatest employee turnover at 25 per cent, which is likely brought on by stable economies, growing markets and increased retail investor confidence.
At 23 per cent, attrition was also high in the outsourcing industry. The lowest turnover was recorded in the manufacturing sector at 11 per cent.
Though the survey does not have breakup of sectoral attrition rates in India, outsourcing industry has the highest rate at 30-35 per cent, according to industry body Nasscom. And the influx of private banks has pushed the rate to 20 per cent in the India banking sector.
Interestingly, a survey by Mercer Human Resource Consulting highlighted that finance, marketing and HR directors in India get less than average for this position in Europe, US and East Asian countries. Finance directors earned a base salary of approximately $53,800. Again, HR directors earned significantly less annual base pay at $47,900 respectively. Base pay for marketing directors ranges between $203,100 in the US and $40,000 in India.
Indian companies are battling higher attrition rates than their Asian counterparts. India Inc faced a 20 per cent attrition rate in 2005, against 14.5 per cent in 2004, while companies in Asia saw 16 per cent attrition in 2005, up from 14 per cent in 2004, according to Hewitt's Attrition and Retention Study Asia Pacific 2006.
Outside firms paying higher salaries is the main reason employees quit their organisations in Asia. The study says 21 per cent of Asian firms cited external inequity of compensation as a prime reason for employees changing company. Limited growth opportunities and role stagnation ranked second and third respectively.
In this count also, Corporate India faces more heat — 59 per cent of Indian firms cited bigger pay packets as a reason for their staff leaving.
Andrew Bell, head of Hewitt's talent and organisation consulting practice in Asia, said, “In high-growth markets, it’s now easier for employees to move from one company to another, and so the complexity and cost of keeping the right people in an organisation increases.”
Turnover was highest at the professional/supervisor/technical level at 39 per cent of the total attrition and lowest among senior/top management at just 0.5 per cent. Interestingly, attrition among employees identified as high performers was much lower, indicating that most organisations are successfully retaining top performers.
The study says the Asian banking and finance sector saw the greatest employee turnover at 25 per cent, which is likely brought on by stable economies, growing markets and increased retail investor confidence.
At 23 per cent, attrition was also high in the outsourcing industry. The lowest turnover was recorded in the manufacturing sector at 11 per cent.
Though the survey does not have breakup of sectoral attrition rates in India, outsourcing industry has the highest rate at 30-35 per cent, according to industry body Nasscom. And the influx of private banks has pushed the rate to 20 per cent in the India banking sector.
Interestingly, a survey by Mercer Human Resource Consulting highlighted that finance, marketing and HR directors in India get less than average for this position in Europe, US and East Asian countries. Finance directors earned a base salary of approximately $53,800. Again, HR directors earned significantly less annual base pay at $47,900 respectively. Base pay for marketing directors ranges between $203,100 in the US and $40,000 in India.
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