Indian back-office firms face a growing challenge holding on to employees, even as they hire tens of thousands every quarter. Indian back-office firms face a growing challenge holding on to employees, even as they hire tens of thousands every quarter. Staff tend to account for half of a back-office operation’s costs, according to research firm Evalueserve, and the battle for talent has led to a 10-15% rise in employee salaries. Recruitment and training makes up 3% of the overall per-employee cost of about $13,000 per year, including administration and telecoms costs, according to Evalueserve. But the really damaging cost is the lost business for companies which cannot fill key jobs quickly enough. Many face a shortage of mid-level manpower to manage their rapid growth as they lure clients with promises of 40% to 50% cost savings. As the industry clocks up 50%-plus growth, demand for quality personnel is outstripping supply. Employees often hop to new jobs for slightly more money, and many do not view back-office work as a career. Companies provide free transport, subsidised meals and housing to retain staff, and try to enliven the environment with musical entertainment, yoga classes and costume contests.