With the startup froth settling down amid both consolidation and trepidation across the Indian eco-system, job seekers are looking at ‘traditional’ companies that have successfully retained most of their employees with relatively fewer attritions over the last two years, when startups began to bleed financially and attrition and closures increased by the day.

“We have noticed less than 5 per cent attrition. People now want a longer association with the company they join and look for job security,” Manu Sharma, HR Head, Hero Electric, an e-vehicle maker since 2007, told BusinessLine .

About the startup boom that witnessed astronomical salaries being offered, he said money could be a great motivator initially, particularly in the first or second jobs. But soon they realise these jobs did not often offer longevity.

The startup boom was like the credit card boom, with the initial enthusiasm giving way to a cautious approach due to the hidden costs involved. “India is largely a country of savers, who, at the very best, spend only what they have in their pockets. Clearly, astronomical salaries could be compared with credit cards involving hidden costs,” he said.

Eco-Rent-A-Car registered 18 per cent attrition in 2015-16 and 20 per cent in 2016-17. “Most startups did not play according to business rules. They tried to achieve higher toplines and valuations to attract funding, instead of focusing on profits and gaining new customers. Selling below cost bleeds them and they soon lose out on money as well as customers,” said Aditya Loomba, Joint Managing Director, Eco-Rent-A-Car, that came into existence in 1996. “We focus both on top-line as well as bottom-line.”

He said the startups could not show profitability despite providing deep discounts that increased their costs. “In our company, many people have been working since the last 20 years. We work like a family and provide fresh job opportunities within the company to our employees before taking in external candidates.”

Loomba said any artificial incentives may lure job seekers and customers for some time. Once these incentives are stopped, it becomes disastrous both for the company and its staff, as in the recent case of radio cab aggregators. Astronomical salaries often ruin careers vis-à-vis those getting market salaries. The so-called “best price” offered by startups is actually an artificial price for a short period, he added.

ExportersIndia.com, a Delhi-based B2B marketplace incepted in 1997, witnessed 28 per cent and 24 per cent attrition during 2015-16 and 2016-17, respectively. “We even recruited about 2-5 per cent of our staffers who had left and wanted to join again. They needed no training and could start work on day one. It was a win-win situation both for them and us,” said Sunil Kumar Gupta, Founder-Director.

In such ‘traditional’ companies, he said, employees are aware of the firm’s presence in market, processes are well defined, there are clear hierarchies, promotional opportunities and relatively less pressure for performance. “Attrition is often due to the immediate boss.”

In a startup, Gupta pointed out, a highly-paid, multi-tasking official is over-stretched and even counted more than others. But promotions are offered to youngsters more than to experienced ones. This creates an unhealthy work culture, job dissatisfaction and causes attrition to swell.

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