![]() ![]() ![]() These well-developed hiring and training capabilities that major service providers have invested in over the last two decades will be put to the test in India over the next few months. So far, service providers have managed attrition through robust hiring and talent development practices. Due to the pandemic, experienced resources now ask for higher compensation, more flexible work-from-anywhere environments, healthcare, and other perks that are not always a given, especially in India.Īttrition has always been part and parcel of this industry (see 2019 figures for reference). The employee value proposition is in jeopardy for many service providers.The result is a lack of ready talent, as most providers maintain a lean bench of resources. The supply side as a whole underestimated this comeback in demand following last year’s initial slowdown. An unexpected mid-pandemic demand surge as global clients try to pivot their operating models to respond to myriad market changes, not least seeking cost savings, is emptying the talent pool.Two key reasons contribute to this talent crunch across Indian IT and BPO markets: Anecdotally, we hear that companies’ attrition rates in India are hovering anywhere between 30% and 50%, which is certainly higher than the last few years. While these officially reported figures are not India-specific, we believe India’s attrition rate is far higher. The average global attrition rate for Q3 2021 is 20.4% for announced results. Staff turnover is decidedly a global challenge, but the problem is acute in India. In our interactions with IT and BPO (business process outsourcing) service providers and recently announced quarterly results, we see spikes in attrition over the last two quarters. OneOffice Mindset & Horizon 3 InnovationĮntering the final quarter of a difficult year, the global IT and business process services industry is very much in the midst of a talent crisis.
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