Increasing attrition rate in the industry attributed to night shifts, lower salaries and lack of outreach

After witnessing an explosive growth for almost five years, the Business Process Outsourcing (BPO) industry suddenly seems to be losing its allure among employees and potential recruits. Most of the 20 major BPOs in the city complain not only of heavy attrition, but also of a dearth of qualified individuals.

Sources in the industry say the attrition level in BPOs was about 11 per cent a few years ago, and now it is around 18 per cent, and goes up to 25 per cent in smaller BPOs, where there are no standard income and human resource policies

A year ago, many arts and sciences colleges, especially women’s colleges, asked BPOs not to recruit from their campuses. “Many parents are wary of them. The night shift policy of BPOs is the main reason for this. Also, students prefer jobs in the IT industry, publishing and consultancies,” says Shyamala Kanakarajan, vice principal, Ethiraj College for Women.

Engineering students also see them as a last option considering the many options available — start-ups, SMEs and dotcoms among others. “It is not just the night shifts but the ‘call centre culture’ that we want to avoid,” says Prabha Ram, who works in a BPO in Velachery. She says easy transfers, more promotions and skill-development programmes are what the industry needs. “Getting a transfer within the organisation in smaller BPOs is so difficult that you can work only when you are fine with night shifts. Since, getting new recruits is easy, BPOs do not try to retain their employees.”

A. Gandhi, Training and Placement, Saveetha College of Engineering points out that fresh graduates hardly know how outsourcing works. “There is no interaction between the BPOs and the academia, and almost no BPO offers internships to students.” However many students, if rejected by top firms, take to joining the firms’ BPOs. “The brand matters a lot. And the work also demands technical skills which these engineers have,” says Prof. Gandhi.

A placement director of a reputed private engineering college says having BPOs in their list of placement companies does not go down well with students. “At the end of the placement season, we ask the students with not-very-good academic credentials to go to BPOs with vacancies. Only around 30 of the 300 in a batch of students do so, because they fear the tag will stay on, and they will be rejected by IT firms. The ones who join them try to shift within a year.”

BPO heads are also worried about absconding employees – those who leave without telling the management. “Employees abscond for as small an increment as Rs. 500 a month. There is a lot of loss incurred as we give them extensive training too,” says K.R. Muthy, HR head of a talent assessment firm. Companies such as Allsec, Sutherland and Genpact are combating this issue by recruiting candidates only through an employee referral mechanism. “Special incentives are given to employees who refer us to good recruits. Team-building exercises and family get-together are being organised too,” says an HR official.

The foremost thing one needs to know is not to equate a BPO to a call centre, says Arjun Anand, manager, client services, Merit Group. “There is IT work, database management, consultancy and much more that happens in a BPO, besides voice calling.” And not every BPO works on night shifts,” he adds, detailing the many who work at Indian and U.K. times.

While IT companies have an average annual salary of Rs. 3 – 3.7 lakh, their BPOs pay around Rs 2 – 2.6 Lakh, and the smaller ones pay even lesser, which also contributes to the attrition phenomenon. According to NASSCOM officials, however, the city is on par with Bangalore, Hyderabad and Delhi in terms of salaries, and behind only Mumbai and Gurgaon.

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