Service Sector Growth Rate in India GDP has been very rapid in the last few years. The Service Sector contributes the most to the Indian GDP. The Growth Rate of the Service Sector in India GDP has risen due to several reasons and it has also given a major boost to the Indian economy. The Indian economy is the second fastest major growing economy in the whole world with the growing rate of the GDP at 7.4% in 2009. The economy of India is the twelfth biggest in the world for it has the GDP of US$ 1.09 trillion in 2007. India ranks fifteenth in the services output and it provides employment to around 23% of the total workforce in the country. The various sectors under the Service Sector in India are construction, trade, hotels, transport, restaurant, communication and storage, social and personal services, community, insurance, financing, business services, and real estate. In service sector, HR managers have to manage all the challenges that they would face from recruiting employees, to training them, and then developing strategies for retaining them and building up an effective career management system for them. It is necessary for the management to invest considerable time and amount, to learn the changing scenario of the HR department in the 21st century. In order to survive the competition and be in the race, HR department should consciously update itself with the transformation in HR and be aware of the HR issues cropping up. With high attrition rates, poaching strategies of competitors, there is a huge shortage of skilled employees and hence, a company’s HR activities play a vital role in combating this crisis. Business has experienced different dynamics that pose many challenges. HR and enforcement authorities together strive for achieving the common goals like compliance and adherence. HR makes all efforts to create and sustain an employer and employee friendly atmosphere and responding to the current needs and challenges.