The National Association of Software and Services Companies, the Indian IT industry body promoting offshore services, has reportedly announced that job attrition is at 50% in the business process outsourcing sector, mainly the call center business. This means that half of staff employed by an offshore BPO company leave within one year.
High attrition rates are typically attributed to the mundane work, poor working hours, lack of promotion opportunities, and the fact that staff often have to don a Western persona and identity while at work. Attrition is undesirable due the knowledge loss and training fees incurred. Combined with reports that Indian BPO wages rose between 15% and 20% in the last year, this could cause a serious problem for an industry that relies on highly trained, low-cost staff.
The new statistic is slightly better than the 70% attrition rate that some BPO companies, and even Nasscom executives, have reported to ComputerWire. In this context it is difficult to see whether Nasscom’s announcement is good news or bad. However, it might not matter, given the findings of the latest report on the Indian offshore industry. Evalueserve, a consultancy providing research and services to offshore service providers and clients, has revealed details from an upcoming report claiming that the public backlash against sending jobs overseas has actually helped the industry.
According to Evalueserve, Indian BPO companies have received the equivalent of $89m worth of advertising from media coverage and heightened awareness of the backlash against sending public and private sector BPO and IT services work to India.
The company quotes Rohit Kapoor, president and chief financial officer of EXL Services saying it has had between 15% to 20% more customer contacts than last year, despite the backlash. It seems that whatever the actual state of affairs, the offshore BPO industry’s growth is assured for the next few years at least.
