Hankyung Research Institute: 64% of Large Corporations Have Zero or Undecided Hiring in First Half... Frozen Youth Employment

[Asia Economy Reporter Lim Chun-han] Six out of ten large corporations have either not planned any new hires for the first half of this year or do not intend to hire even one person. Although South Korea's economy is showing signs of recovery from the impact of COVID-19, the youth employment market is still considered to be frozen.

On the 7th, the Korea Economic Research Institute under the Federation of Korean Industries announced the results of a survey on 'New Hiring Plans for the First Half of 2021' conducted through the polling agency Research & Research targeting the top 500 companies by sales.

According to the survey results, 63.6% of the respondent companies (110 companies) either will not hire anyone or have not yet established hiring plans for the first half of this year. The proportions of companies with no new hires and those with undecided hiring plans were 17.3% and 46.3%, respectively. Considering that in a survey conducted by the Korea Economic Research Institute in March last year, these proportions were 8.8% and 32.5%, the institute explained that the hiring market has worsened compared to last year.

Among companies that have established new hiring plans for the first half of this year, only half (50.0%) planned to hire at a scale similar to last year. Companies intending to increase hiring accounted for 30.0%, while those planning to reduce hiring were 20.0%. The biggest reason cited by companies that will not hire or will not increase hiring was 'domestic and international economic and industry downturn' (51.1%). Other reasons included 'employment rigidity' (12.8%), 'difficulty in securing suitable talent for required jobs' (10.6%), and 'increased labor cost burden due to minimum wage hikes' (8.5%). Companies planning to increase hiring cited reasons such as 'securing future talent' (75.0%) and 'increased demand for manpower in new industries or new job categories such as ESG (Environmental, Social, Governance) and the 4th Industrial Revolution' (8.3%).

However, companies showed significant interest in on-demand hiring. The proportion of companies responding that they would utilize on-demand hiring in new recruitment was 76.4%, an increase of 9.7 percentage points compared to the same period last year. Companies that would hire new personnel exclusively through on-demand hiring accounted for 38.2%. In contrast, companies conducting only open recruitment accounted for 23.6%. When asked about trends in the recruitment market, the most common answer (29.1%) was 'increase in the proportion of on-demand hiring.' Other responses included 'strengthening of experienced hires' (20.3%), 'increase in adoption of non-face-to-face recruitment' (19.1%), and 'increase in AI-utilized new recruitment' (13.9%).

Regarding policies that the government and National Assembly should promote to increase new university graduate hires, 'deregulation of companies' (35.2%) was the most frequently cited answer. This was followed by 'expansion of incentives for companies increasing employment' (24.0%), 'support for fostering growth engines in new industries' (21.1%), and 'improvement of the dual labor market structure biased toward regular workers and unionized workers' (10.3%).

This content was produced with the assistance of AI translation services.