Monday, September 3, 2012

Banks Will Have To Recruit About 10 lacs Employees Next Five Years


Retirements will create 1.8 lakh vacancies in public sector banks

Collected from the newspaper Business Line
The banking industry will need to hire 9-11 lakh employees over the next five years, according to a report by Boston Consulting Group.
The report, which includes a survey of about 14,000 customers, 50,000 bank employees and analysis of data obtained from about 35 banks in the country, said about half of the hiring will be due to attrition.
The banking sector is expected to grow at approximately 20 per cent over the next decade and will need major induction of talent, a significant part of which is to replace vacancies arising due to retirements in public sector banks. At the current rate of attrition, the industry will need to hire over four lakh more people.
“We will hire around 6,000 this year,” said Pratip Chaudhari, Chairman, State Bank of India.
Retirements in public sector banks will continue to increase and peak by 2017. In total, 1.8 lakh employees will retire and will be replaced. Depending upon the productivity growth, the industry will need 2.5-4.5 lakh additional people for growth in business.
Saurabh Tripathi, Partner & Director, BCG, said: “Public sector banks will have to double the current intake of employees to meet the talent needs of future.”
http://www.thehindubusinessline.com/industry-and-economy/banking/article3855137.ece

Public sector banks able to retain new hires better than private banks: Report

Management consulting firm BCG has found that, on an average, 12 per cent of the new recruits hired by public sector banks quit within the year.
This compares favourably with the corresponding figures of 22 per cent and 20 per cent for new and old private sector banks, respectively.
“Contrary to popular perception, public sector banks are not losing their fresh hires in large numbers.
“Clearly, there is an element of public sector culture and work environment that is working for the fresh hires to stay,” said BCG in its report on productivity in Indian banking.
PSBs may not be facing attrition today because relative compensation at junior levels in good.
However, the firm cautioned that as the new hires reach middle management levels, the threat of losing the best people will be very high due to compensation mismatches.

RETENTION STRATEGY

The smaller new private sector banks, which suffer from attrition the most, are most alert about using all the levers for retention, said BCG.
The levers of retention being used by them are: special training programs, talent pool program, onboarding of new recruits, job rotation, preferred location posting, incentives, and fast-track promotion.
PSBs are focusing on special training programs, fast-track promotions and preferred location posting, apart from job rotations.
However, their emphasis on talent pool program and onboarding of new recruits as retention tolls is low. “Overall, retention of employees is the ultimate acid test. In a competitive market, it is only a matter of time before banks with disengaged work force lose staff to other banks or other industries,” cautioned BCG.
The firm, among others, recommended strategic work force planning; round the year recruitment engine backed by employer brand; ‘intrusive training’ as a new training and onboarding paradigm, and smarter work environment.

Finance Ministry wants loss-making banks, insurers out of CCI ambit: MCA

The Finance Ministry has sought an exemption for mergers and acquisitions of “loss-making and failing” banks as well as insurers that are being vetted by the Competition Commission, the Corporate Affairs Ministry said today.
However, no banks have themselves sought any exemption from their mergers being reviewed by the fair-trade regulator, Minister of State in Corporate Affairs Minister RPN Singh said in reply to the Rajya Sabha.
Asked about any exemption sought for the telecom sector, Singh said the Department of Telecom (DoT) has not sought any exemption for mergers and acquisitions (M&As) in the sector from the CCI purview.
“No such communication has been received from Department of Telecommunication seeking exemption in the telecom sector.”
About the banking sector, “Department of Financial Services has approached the Ministry (of Corporate Affairs) for granting exemption to loss making and failing organisations in the insurance and banking sector from the purview of the Competition Act, 2002,” Singh said.
CCI has the powers to review and approve the M&A transactions that could have bearing on competition in the market. The Competition Act empowers it to check anti-competition practices and abuse of dominant position.

No comments:

Post a Comment