New Delhi: The Indian IT sector is grappling with high attrition rate even as firms are doling out financial and other benefits to employees, says industry body Nasscom.
"As a result of the slowdown, the IT industry was rather thin on the bench, but now everyone is hiring laterally. As a result, attrition has already become a problem. It will be more problematic over the next 4-5 months," Nasscom Chairman Som Mittal told.
He added that while the attrition rate was in single digits a few months ago, it is now growing. "Last I heard it was 16 percent, but it could be inching up depending on the city you are in," Mittal said.
At Infosys Technologies, the attrition rate rose to 13.4 percent in 2009-10 from 11.1 percent in the previous year.
However, for TCS the rate has remained stable at 11.8 percent as on March 31, 2010.
Companies need to hire freshers from technical institutes and train them to meet the requirement, Mittal said.
"As demand comes back, the need for manpower has also gone up. The industry needs to hire fresh people and build that pipeline. Companies need to hire them (the freshers) and train them, which should help a lot," Mittal said.
Even though attrition is a challenge for HR managers, it spells good news for job hunters as more opportunities open up along with incentives like retention bonus as companies try their best to attract new talents and retain existing critical resources.
IT biggies have already announced huge hiring plans. TCS, the country's largest software services provider, has said it will hire 30,000 people this year.
Infosys, India's second largest software exporter, on Tuesday said it was looking at recruiting nearly 30,000 people this fiscal, including over 2,000 from overseas.
The third largest software exporter Wipro has said that its hiring plans will be in line with volume and demand.