Public Institution Workforce Reduction for the First Time in 14 Years... Cutting 12,000 Employees

Gongunwi Approves 'Function Adjustment and Organization & Workforce Efficiency Plan'
2023 Public Institution Staffing Reduced from 449,000 to 438,000
17,230 Staff Cut "Annual Labor Cost Savings of 760 Billion KRW"

[Asia Economy Reporter Song Seung-seop] The workforce at public institutions is set to decrease for the first time in 14 years. This comes as the Yoon Suk-yeol administration’s public institution reform measures, described as "the party is over," are applied to personnel and organizational sectors. The government estimates that labor costs will be reduced by more than 700 billion KRW annually due to the workforce reduction.

On the 26th, Choi Sang-dae, Vice Minister of Strategy and Finance, announced at the Public Institution Management Committee held at the Seoul Government Complex in Jongno-gu, Seoul, that the "Public Institution Innovation Plan including Function Adjustment and Organization and Workforce Efficiency Plan" was proposed and approved. According to the plan, 17,230 employees, equivalent to 3.9% of the total 449,000 public institution workforce, will be cut. The net reduction is 12,442 employees (2.8%). The labor cost savings from the workforce adjustment are estimated at 760 billion KRW annually.

As a result, the public institution workforce next year is expected to decrease to 438,000, marking the first reduction in 14 years since 2009. At that time, the government reduced personnel from 262,000 to 243,000 by promoting consolidation, function adjustment, and management efficiency of public institutions. The workforce at public institutions, which began to increase again from 2013, grew by 115,000 during the Moon Jae-in administration, from 334,000.

35% Reduction at Korail Logistics, 1,041 Employees Cut at Korea Expressway Service

The public institution workforce reduction is carried out in three main ways. Function adjustment accounts for 7,231 employees, organization and workforce efficiency for 4,867 employees, and reducing the workforce beyond the current number by 5,132 employees. According to the plan, 4,788 employees will be reassigned. Workforce reassignment was conducted in areas requiring essential personnel such as national agenda execution and safety.

The institution with the highest reduction rate relative to its total workforce is Korail Logistics. Korail Logistics, a subsidiary of Korea Railroad Corporation, will reduce 35.3% (296 out of 839 employees). Korea Coal Corporation will also cut 21.2% (139 out of 655 employees), reducing work sites and management personnel due to decreased coal production.

The largest reduction in numbers is at Korea Expressway Service, with 1,041 employees (16.5%) cut. This is due to the introduction of unmanned and automated systems such as expanded installation of toll collection machines, reducing toll collection functions. Korea Railroad Corporation follows with 722 employees, then KEPCO MCS with 612, Korea Electric Power Corporation with 496, and the Post Office Facilities Management Group with 445 employees.

Vice Minister Choi Sang-dae emphasized, "The series of public institution innovation plans have been concluded for now," adding, "Going forward, we will enhance institutional capabilities so that compensation, organization, and personnel are operated based on job performance and results."

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