BPO sector is gearing up to generate one million jobs by the year 2008. However, high attrition rate is the biggest challenge faced by this sector. This article discusses the strategies to be adopted to reduce attrition rate.

Information Technology Enabled Services (ITES) and Business Process Outsourcing (BPO) companies are the fast growing service companies in the country. Over the past five years, the Indian BPO and ITES companies have been growing at a rate of about 50-60%. According to a report by the Indian software trade association, National Association of Software and Service Companies (Nasscom) and global consulting firm, McKinsey, the combined market is expected to grow from $30 bn to $300 bn by 2010. Assuming this expected growth, the Indian ITES and BPO companies will directly employ approximately 2.3 million people, with another 6.5 million employees working indirectly for the industry. The Indian BPO and ITES companies have generated a growth rate of 46% and clocked a revenue of US$3.6 bn in 2003-04 up from US$2.5 bn in 2002-03, $5.2 bn in 2004-05, and are projected to grow to $7.3 bn in 2005-06. The Indian ITES sectors are expected to create nearly 2 million jobs in the next few years. BPO sector is said to be poised to generate 1 million jobs by the year 2008. High attrition is the biggest challenge faced by these industries.

ITES and BPO companies provide more employment opportunities to the youngsters, especially to the fresh candidates at the entry level. For a fresh graduate, it opens about 2.5 times more opportunities than other job openings in the labor market. Also, they offer extra facilities to their employees to retain them in the organization for a long time. In spite of that, many of them are leaving the organization for many reasons.

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