Recent study reveals that Indian startups are facing with high attrition rate which is about 21 percent. It is also known fact that Indian startups are paying 85 percent more than other companies in the market. Many Indian startups hire junior level employees and performing well in the market. Even thought they are facing attrition as compared to others. A recent study published by a manpower group reveals that Indian startups pay more in the market and provide more growth opportunities in the industry. This kid of pay philosophy is attracting more young employees and junior level candidates which is a challenge for other organisations.
Startups don’t provide stock options as incentives and which is most attractive incentive provided by top organizations. The most common reason in startups is pay and other benefits, long term incentives which are not availed in startup companies. Because o f this reason attrition rate increased from 17 percent to 21 percent which is most considerable point. When the employees are being hired at high salaries, being offered perks such as stock options and then why would they leave for higher salaries??
The survey revealed that most of the employees left for the reasons of high salary and salary dissatisfaction. Generally we all look for the job opportunity which provide better work place, career growth and learning opportunities to prove ours elf to meet our career goals. Employee referral is the top most recruitment methods. This clearly shows that startups also using social media and network channels to get top talent. Brand image, career growth and social recognition are the other reasons for attrition rate in startups.
For hiring talent, employee referrals contribute nearly a third of all hires. Professional networking sites are used by 55 per cent of organizations in scouting for top management. Middle and junior management roles are hired through recruitment agencies and online job portals