Attrition- an eight letter word that is currently an 11 digit problem for India Inc. Our rapidly growing formal sector is now 120 million strong, on the back of strong entrepreneurship and enhanced scale. Unfortunately, this breakneck speed of growth has also created a $10billion+ attrition problem.

In addition to the financial impact, it lowers productivity and presents a significant bottleneck to profitability. While it is everywhere, very few managers understand it, or how to combat it. At Haasyl, we focus on workforce attrition (see image below for workforce v talent difference). While people at these roles may seem replaceable, the sheer volume of attrition at this level makes for gargantuan costs to companies.

At Culturro, we focus on employee lifetime value for the knowledge workers. What is employee lifetime value? It’s a sum total of all the output an employee produces in her duration for a company. It is impacted by how well employees perform in a company and how long they stay. The knowledge workforce is not easily replaceable, especially the good ones. When they leave, the cost per unit tends to be devastating.

Anemic Wages + Inflation= High Price Sensitivity of Workforce

There is very little we can do to combat attrition that is systemic due to the macro climate. According to studies, over 50% of the population has under INR 5,000 in savings, and average wage rates sit at about INR 13,000. Research shows that for 95% of employees, wage growth barely outpaces consumer price inflation on an annualized basis. So if your blue collar/low paying white-collar staff is leaving because they are getting more money, unless you can match the new salary, there is not much you can do. However, there is a substantial part of attrition that every employer can ameliorate. We highlight some of the mistakes made by employers on a micro level and in the end, we highlight some simple solutions that companies can roll out now, to bullet proof their workforce and retain their talent.

Micro Causes

1.    Rigid Pay CyclesHave you ever wondered why people do not have to wait 30 minutes for a pizza, but still have to wait 30 days to get paid? Imagine eating at a restaurant, and when the bill comes, you tell the waiter “I’ll pay you at the end of the month”. Ludicrous isn’t it? Now think about the plight of employees at the lower and middle-income levels. Waiting 30 days to get paid for work done now, all the while having to brave the bills and expenses (which are synced with your salary btw). You will be surprised at how many people leave jobs because of this reason. In this case, it is not even about the quantum of pay, but it is about the velocity of it. When your pay-cycle is not aligned with your way of life, it exacerbates employee stress.

The pay-cycle is a killer, quite literally. It saps productivity, breeds attrition and creates a ripe opening for predatory payday loans. This is evidenced by the loan scam which recently came to light (21,000cr in 6 months!). If the way you are running payroll is creating financial problems for your workforce, then clearly the system is broken. We live in an on-demand world, and expenses are certainly on- demand. In the west, companies like Payactiv and Wagestream have been helping employers roll out flexible pay solutions to their employees. In fact, the concept of Earned Wage Access– the ability to withdraw that portion of your wages for which you have already completed the days of work– has received tremendous attention and adoption.

So if you are an employer, especially in high attrition segments- hospitality, IT/BPO, low paying government jobs, contract labour etc, you need to pay attention not just to the amount of pay, but also on the pay-cycle you are runningIf you are unable to align payroll with the way of life of your employees, you are setting yourself up for attrition, lower productivity and even worse- putting your employees in the clutches of payday lenders.

At Haasyl, we are pioneering Earned wage access (EWA) in India. With Haasyl ‘Suvidha’, your workforce can now access their pay as they earn it, eradicating the 30 day pay cycle and the problems that come with it. We’ve even found that merely knowing how much you earn in a day develops a stronger link between work and pay. What’s more, looking at your earned wages daily allows you to think about saving daily as well. As an employer, the financial health of your employees should be of utmost concern to you. Help them take better control, and watch how productivity and loyalty sky rockets, while attrition plummets.

2. Cultural Factors: The workers in the organized sector, on the other hand, are more secure in terms of being paid monthly salaries. As per one O.C. Tanner Institute report, 89% of the employers feel that employees quit the job because of money. However, only 12% actually do so because of money, as quoted by the same report. The real cause behind white-collar workforce attrition remains the experiences that people get in organizations. What makes an employee stick with or leave an organization is the numerous interactions she has daily. This is where the people managers and the leaders come into the picture. 51% of employees quit because of their managers. In fact, 58% of employees are willing to take a lower salary to work for a great boss. This problem is compounded in fast-growing companies.

Another factor contributing to the attrition in such companies is employee burnout. Indian millennials spend an average of 52 hours a week in their work, which is higher than millennials in the other 25 countries under a Manpower Group study. A burned-out employee is 2.6 times more likely to actively look for another job. Knowledge workers, especially millennials, have very different expectations from the workplace. They need a space that provides them with a sense of purpose, takes care of their wellbeing, provides opportunities to grow, gives them autonomy, and caters to their other psychological needs. To grow sustainably, organizations need to create a stable base of talent, especially high-performing talent, which can be at least 4 times more productive than the average workforce. To retain this talent, companies must invest in enabling their managers to become better in people management and bring structural changes in the employee experience. 

Agnya, Culturro’s employee experience platform, enables managers to measure and change employee experience in real-time. Think of Agnya as a real-time coach for your company’s managers. It helps managers to identify the real cause of attrition and loss of productivity in their respective spans. Also, it guides managers to bring in the right changes to change the employee experience. All this is not to make employees happy. But simply to help the teams achieve their objectives in the best possible way.

The COVID-19 pandemic has put a severe strain on your workforce and your talent. Usher in the new decade with an approach that not only puts employees first but also recognizes and fosters their individuality.

About the authors

 Ashish Manchandais the Founder and CEO at Culturro. Culturro is a SaaS company on a mission to help companies increase the life-time value of employees. Culturro’s platform, Agnya, leverages behavioral science and AI to allow managers to measure the employee experience. It also guides managers and employees, in real-time, to bring the required behavioral changes.

Vishwa Naik is the Founder of Haasyl. Haasyl is empowering India Inc’s workforce by increasing the flow of capital and opportunities to them by leveraging the power of payroll data. The first product, Haasyl ‘Suvidha’, provides employees access to their wages as they earn it. No waiting 30 minutes for pizza, no waiting 30 days to get paid!

Culturro helps companies to increase the lifetime value of employees. Culturro's product Agnya helps managers and stakeholders to quantify employee experience and its drivers. Moreover, Agnya also guides managers in real-time to create meaningful experiences for their teams. Know more at or 

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