Big Businesses Cut 6,300 Jobs in Coronavirus Pandemic
28 March, 2021
Big conglomerates cut 6,300 jobs amid the coronavirus pandemic as their earnings dropped.
Analysis of the business reports of 74 of Korea's top 100 companies shows that their permanent staff stood at 686,205 as of the end of 2020, down by 6,297 from a year earlier.
Offline retailers were hit especially hard. Lotte Shopping cut 2,350 jobs, while Shinsegae's superstore chain E-mart 565 workers. Doosan Heavy Industries, which was hit by the nuclear phase-out, laid off 1,232 people. But Samsung Electronics and SK Hynix's business boomed thanks to high demand for memory chips, so they hired 4,275 and 775 new staff.
Six out of 10 major conglomerates cut back on new hires last year, and their permanent staff dwindled.
The job losses are mainly due to deteriorating earnings and the main force of Korean industries shifting to the IT sector, which employs fewer people. Although the combined sales of the top 100 declined 5.5 percent to W1.5 quadrillion, their operating profits edged up 2.5 percent on-year to W82 trillion.
But without Samsung Electronics and SK Hynix, combined operating profits plunged almost 18 percent.
Reliance on the semiconductor industry stretched to jobs. Thirty big companies hired 8,131 new workers, but Samsung hired 4,274 of them and SK Hynix 775, accounting for 62 percent.
Internet companies and game developers, which benefited from the increased time people spent at home in lockdown, also boosted hiring. Although not included in the country's top 100 companies, Naver, Kakao and NCsoft hired a combined 1,214 workers last year.
Kim Jung-sik at Yonsei University said, "We desperately need to nurture the service industry, which has a huge impact on job growth."
According to the Federation of Korean Industries, the country's top 100 businesses account for 63 percent of total sales generated by companies here. Cho Kyeong-yeop at the Korea Economic Research Institute said, "We need to create conditions for key domestic businesses to recover their earnings and make new investments.
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