Banks to recruit over 50,000 junior officers to combat FY23 attrition
HDFC Bank, India's largest private-sector lender, saw attrition of 34.15% in FY23, while IndusInd Bank saw 51% attrition and ICICI Bank 30.9%
PRIVATE banks aim to hire at least 50,000 people for entry-level roles over the coming year to battle high attrition in this segment, bankers and recruitment experts said.
The lenders are facing what they call “infant mortality" – just-recruited employees leaving for logistics, delivery services and other firms – and are hiring from campuses in large numbers since recruiting from the market is more expensive.
“Banks will hire about 50,000 people in junior positions, including from campuses, over the next one year," said Upasana Agarwal, partner (professional and financial services), ABC Consultants, an executive search and talent advisory firm.
“Attrition at the juniormost levels can be as high as 50-60% and campus hiring enables a firm to be talent-ready. These models allow hiring in bulk rather than bringing talent in a fragmented manner," Agarwal told Mint.
Attrition has been somewhat evenly spread across private banks. HDFC Bank, India's largest private sector lender, saw attrition of 34.15% in FY23, while IndusInd Bank saw 51% attrition and ICICI Bank 30.9%. For most banks, junior levels in non-supervisory segments bore the brunt of these early departures. Experts said the impact of attrition is more potent in the long term than in the short term.
“While it is difficult to dissect the impact of such things on the short-term performance of an institution, in the long term it can potentially impact the quality of the talent pool within the organization, its growth and profitability prospects," said Anil Gupta, senior vice-president and co-group head, Icra Ltd.
“Axis Bank will hire about 12,000 from campuses from the batch of 2024 – four times more than last year. This is across tier 1, 2 and 3 institutions. For every skill we have a campus feeder programme," said Rajkamal Vempati, president and head of human resources, Axis Bank.
The bank, Vempati said, recruited about 3,000 people from campus and academic programs last year (batch of 2023) and this time the spike will be in profiles such as lending, corporate and branch banking, as well as roles in information technology (IT) and analytics.
Academic programmes refer to short training sessions (they last about three months) that take place when students are still in college that aim to make them industry-ready before they graduate. Direct campus recruits are those hired straight from colleges without any pre-training.
In the previous financial year, lenders saw a sharp rise in attrition as demand for young workers with digital skills in sales and marketing surged in insurance, retail and fintech. An uptick in campus hires will also help banks cushion the talent loss.
"A large number of these new hires are for replacement positions. Today, lenders are facing stiff competition from fintech firms, which is pushing them to penetrate deeper into markets for personal loans, credit cards, etc," said Kartik Narayan, CEO Staffing, Teamlease Services.
According to banking recruiters, banks are offering about ₹5 lakh in tier 2 and 3 colleges, and this can rise to ₹8 lakh if the candidate has digital skills. Salaries in premier business schools range from ₹20-30 lakh and those in the better-known engineering colleges range from ₹15-20 lakh.