Nearly 67% startup employees looking for transition to established firms: Report

Mumbai: Almost 67 per cent employees of startups, who took part in a survey, said they are looking for a transition to established firms, a report released on Wednesday said.

The CIEL Works Startup Report 2024 is based on the data and analysis of 1,30,896 employees across 70 startups across the country, along with 8,746 job postings sourced from various job portals.

Around 67 per cent of the surveyed workforce are open to transition to established firms with job security and the promise of better pay being given as the top two reasons, CIEL HR Services' recent survey on the hiring and recruitment trends has revealed.

The report further revealed that job security ranks high on the list of concerns for employees in the startup sector, with 40 per cent of the respondents expressing unease about this aspect within startup roles.

Moreover, 30 per cent of respondents are lured by the promise of better pay offered by established firms, underlining the importance of financial stability in career choices, said the report.

Additionally, 25 per cent of participants mentioned a lack of work-life balance as a significant factor influencing their inclination towards established companies, it added.

The report also revealed that attrition continued to be a challenge for the sector marked by an average median tenure of merely 2.3 years, considerably lower than other industries.

"In the rapidly evolving environment of India, startups play a vital role as key catalysts for growth, fuelling innovation and generating employment in diverse sectors. With 65 per cent of companies planning to increase hiring in the coming months, the future looks promising for the start-up ecosystem, we expect this ecosystem to revive by the end of this year," CIEL HR Services Managing Director and CEO Aditya Narayan Mishra said.

However, start-ups need to prioritise employee retention and provide comprehensive value propositions that prioritise employee well-being, career advancement, and work-life balance, which will help employees regain their confidence in start-ups and reduce attrition, he added.

The report further highlighted that early-stage funding, which started at USD 151.22 million in January 2023, experienced a gradual decline over time, however, it has shown a consistent increase since November 2023.

Software development roles are the most in-demand, constituting 18 per cent of job requirements in the startup sector, closely followed by various sales roles, including pre-sales, retail sales, and enterprise sales, reflecting the need for skilled professionals to drive technological and commercial growth, the report added.