Attrition in SMEs: The Cause

Abstract

Human Resource managers are devising ways to retain talent next year that will see companies paying annual increments up to 30%. The average attrition in 2010 was 10% across Indian companies, a rate that may rise to 25% in 2011-12 with improved salaries (The Economic Times, Dec 24, 2010)

The SMEs sector in India has certainly been a very prevalent are of employment in recent years but one of the biggest encounters it is facing is a remarkable rise in attrition rate. There could be some common attrition factor across industry but every organization need to know the reason for attrition. India's economy is showing a healthy progress, but employers enjoying the bang have a offhand side: that of restless staff seeking for a hotter career option leading to increasing attrition in Indian SMEs. Authors have tried to find out the reason for attrition in SMEs, what the factors that are leading to attrition in SMEs in India? A conceptual framework has been developed to understand the relation between the factors affecting attrition. Our findings suggested some crucial factors affecting attrition in SMEs. This paper may be help for entrepreneurs to dealt with attrition in the organizations.

KEYWORDS: Attrition, SMEs, Entrepreneurship, Indian Economy, India