High attrition continues to shadow Corporate India

SALARY SURVEY: Companies continue to search for talented people even under tough economic milieu

India Inc continues to see a double-digit attrition rate, this time of 13.8 per cent — the highest in Asia Pacific region — despite economic uncertainty, says a survey. As per global HR consultancy Hewitt Associates’ annual Asia Pacific Salary Increase survey for 2009-10, most Asian companies have continued to experience double-digit voluntary employee turnover rate amid the economic downturn. “The top four markets reporting the highest turnover rate are India (13.8 per cent), Australia (11 per cent), New Zealand and China (10.3 per cent),” the report stated. Turnover rate refers to the ratio of the number of workers that had to be replaced in a given time period to the average number of workers. “While many would believe the economic uncertainty should help ease pain on high employee voluntary turnover, the Hewitt 2009/2010 Annual Asia Pacific Salary Increase Survey does not reveal the same. The comparatively high turnover rate...raises an alarm to the world,” Hewitt Associates Regional Leader Broad-Based Compensation practice Stella Hou said. The survey stated that ‘better external opportunity’ was consistently cited as the top reason for employees voluntarily leaving their organisations across all markets. “This means companies continue to search for talented people even under a tough economic situation... organisations will continue to face a tight talent market,” it added. Single digits Other economies in the Asia-Pacific market, including Singapore, Korea and Thailand, are on high single digits in terms of employee turnover rates in the range of 8.8 per cent to 9.3 per cent. “An organisation’s ability to retain talent is a challenge facing all companies. This provides challenges to be more innovative in retaining the top people in their firms with a tighter budget,” Hou said. Companies need to focus on pursuing different talent management strategies suitable for its own workforce, while the most notably the variable pay programme was the most popular incentive adopted by most companies in the region. “Companies realise that they cannot afford to lose talent. They know ‘high performers’ will help them lead the firm out of the storm into the winning field. Even for those companies experiencing unprecedented levels of uncertainty and cost reduction pressures, they tend to reward and retain their best talent with special incentives,” Hou added. The Hewitt survey revealed that the challenging talent market also compelled companies to reward talent differently with top performers receiving 50 per cent higher rewards than the average performers.