Frozen Job Market... Half of Large Corporations "Zero or Undecided New Hires in the First Half of the Year"

Federation of Korean Industries Surveys New Hiring Plans for Top 500 Companies in First Half of This Year
Caused by Prolonged Global Economic Downturn and Management Uncertainty
"Support Needed Such as Deregulation"

Concerns over a prolonged global economic downturn and management uncertainties have led to a bleak outlook for the large-scale corporate hiring market in the first half of this year.

The Federation of Korean Industries (hereinafter FKI) commissioned Research & Research, a polling agency, to survey the top 500 companies by sales on their '2023 First Half New Hiring Plans.' The results showed that more than half of large corporations (54.8%) either have not established new hiring plans for the first half of this year or responded that they will not hire. Among them, 39.7% had no new hiring plans, and 15.1% reported no hiring at all.

The FKI analyzed, "The proportion of companies that will not hire in the first half of this year (15.1%) has increased by 1.9 times compared to the same period last year (7.9%). This appears to be a response by companies to reduce costs by scaling down or halting new hiring amid ongoing high inflation and high interest rates, supply chain instability, and growing management uncertainties, as well as signs of a prolonged economic recession."

Regarding the reasons companies cited for not hiring or not increasing hiring scale, the most common were ▲poor domestic and international economic conditions due to the 'three highs' of high interest rates, high inflation, and high exchange rates, as well as supply chain instability (29.0%) and ▲internal company circumstances such as restructuring and austerity management (29.0%). Following these were ▲no internal demand for personnel (19.4%), ▲cost reduction measures in response to rising raw material prices and labor costs (16.1%), ▲difficulty in flexible workforce restructuring due to employment rigidity amid changing management environments (14.5%), and ▲difficulty in securing talent with the necessary job skills (14.5%).

For policy tasks to expand new college graduate hiring, companies most frequently selected ▲deregulation in labor, industrial sectors, and other corporate regulations (30.1%). This was followed by ▲expansion of incentives for companies increasing employment (21.7%), ▲support for companies in new growth engine industries (16.9%), ▲improvement of the dual labor market structure biased toward regular employees and unionized workers (12.9%), ▲strengthening career guidance and providing employment information to resolve mismatches (10.4%), and ▲expansion of vocational training support in the Fourth Industrial Revolution sectors (6.4%).

Choo Kwang-ho, head of the FKI Economic Headquarters, expressed concern that "due to the continuation of high interest rates and inflation, export slowdown, and performance deterioration caused by the economic downturn, companies are conservatively reorganizing their management policies, which may worsen the hiring market." Accordingly, he emphasized, "If the government and the National Assembly alleviate regulations and expand tax support during these difficult domestic and international times to ease companies' economic hardships and increase their employment capacity, it will greatly help companies maintain jobs."

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