Many Korean firms plan to cut hiring in H1: report

A quarter of South Korea’s large companies are expected to cut recruitment in the first half of this year due to worsening economic and business conditions, according to a local economic research firm Wednesday.

The Korea Economic Research Institute surveyed recruitment plans of the nation’s 500 largest companies with 300 employees or more between Feb. 5-19. The survey results showed that 27.8 percent of the 126 companies surveyed said they would reduce hiring or not hire at all in the first half. Thirty-two percent of the respondents did not set up recruitment plans yet while only 5.6 percent of the companies said they would increase hiring, the survey found.

Companies cited difficulties in hiring new college graduates because of the worsening business conditions at home and abroad (43.6 percent), aggravating performance (34.6 percent), high turnover of new employees (24.4 percent) and increased labor costs (19.2 percent), the survey found.

“The survey was conducted one week before the COVID-19 outbreak spread in earnest. Given the recent rapid spread of the coronavirus, the job market will get tougher,” said Choo Kwang-ho, chief of KERI’s economic policy division.

According to latest Statistics Korea data, the number of young workers aged between 15 and 29 reached 3,857,000, down 49,000 from 3,906,600 in the previous year due mainly to the COVID-19 outbreak.

Another labor-related data showed that the gender gap in employment remains wide in Korea.

A study by local research firm Sustainable Growth Institute showed that the number of employees at the nation’s 300 major listed companies increased by 17,631 in 2019 on-year, with 80 percent of them male and 20 percent female. The number of male employees increased by 14,088 while the number of women increased by 3,543.

Of the 300 firms surveyed, 166 companies increased their female workforce by 11,781 in 2019 compared to 2018, but 123 companies reduced 8,238 female employees, consequentially increasing to only about 3,500.

By industry, the portion of female employees is the highest in the information technology sector. As of last year, the nation’s 30 largest IT companies by sales had 77,960 female employees, taking up 27.6 percent of total female workers of the 300 listed firms.

The company with the largest number of female employees was Samsung Electronics last year, at 27,599, taking up 9.8 percent of the total women employees of 300 listed firms. It was followed by Lotte Shopping with 18,397 female workers and E-mart with 16,346. 

By Shin Ji-hye (shinjh@heraldcorp.com)