India’s FMCG sector is witnessing a hiring surge, particularly in sales, marketing, and IT, with major cities such as Mumbai leading the charge. However, undercurrents of intrigue and concern lie beneath this expansion.
Tier 1, 2, and metro cities boast higher hiring intentions but also experience higher employee turnover (26-27 per cent). Conversely, Tier 3 and 4 cities, with lower hiring activity, see a lower attrition rate (20 per cent). This suggests a potential link between access to opportunities and higher turnover, with younger employees in these cities (average age 34, tenure: 1.1 years) tending to move on more frequently compared to their established-location counterparts (average age 36, tenure: 1.7 years).
Interestingly, incentives emerge as a surprising factor influencing retention. While the salary gap between active and departed associates is negligible, the incentive gap is significant, highlighting incentives as a more substantial predictor of attrition than salaries. The Teamlease Services report reveals that high performers leaving (21 per cent) often exceeded the company’s average incentive, highlighting its crucial role. Conversely, non-performers leaving (39 per cent) received no incentives. This underscores the importance of well-structured incentive programmes for retaining valuable employees.
However, a concerning gender gap persists. Women represent only 13 per cent of the workforce (around 390,000), with an even lower presence in leadership roles (18 per cent). This calls for efforts to promote diversity and inclusivity, not just ethically but also to tap into a diverse talent pool.
Regionally, the average CTC is highest in the South, with a negligible salary gap between active and departed employees. However, the gap in incentives is substantial, indicating their stronger influence on retention compared to salaries.
Looking ahead, the report emphasises the need for FMCG companies to embrace technology, innovation, and address evolving complexities and consumer demands. Additionally, fostering diversity, minimising attrition, and enhancing workforce productivity are crucial for navigating market uncertainties and achieving sustained success.
The robust hiring activity signifies a positive outlook, but addressing the gender gap and implementing effective retention strategies, particularly focusing on non-monetary incentives, remain critical for long-term growth and a thriving future.
