[Population Decline Hits Industry] Companies Continue Hiring Youth Despite Shrinking Population... Seniors Reassigned as 'Mentors'

Reducing Junior Job Changes and Transfers, Treating Seniors as 'Top Employees'
Youth Hiring Focused on New Businesses... Prefer Frequent Hiring Over Open Recruitment
Semiconductor Industry Removes Age and Border Barriers... Abolishes Retirement Age Limits

Companies facing an era of extinction beyond population decline are focusing on workforce recycling. This means they have begun exploring ways to rehire and utilize retired personnel.

While recruiting young talent centered on new industries such as semiconductors, artificial intelligence (AI), and secondary batteries, they are simultaneously implementing strategies to increase the utilization of existing veteran employees. Systems are also being developed to support these workers so they can continue working even after retirement age.

Samsung Electronics Chairman Lee Jae-yong (fifth from the left in the top row), Samsung Electronics CEO and Head of the Semiconductor (DS) Division and SAIT (formerly Samsung Advanced Institute of Technology) Kyung Kye-hyun (far left in the top row), and Samsung Electronics Mobile, TV, and Home Appliance (DX) Division Head of Management Support Park Hak-gyu (far right in the top row) pose for a commemorative photo after a meeting with the 2024 Samsung Masters on the 16th at Samsung Electronics Seocho Building in Seocho-gu, Seoul.
[Photo by Samsung Electronics]

Utilizing Experienced Workers Rather Than New or Open Recruitment

According to industry sources on the 18th, large conglomerates such as Samsung, LG, and SK are focusing more on reducing employee turnover and job changes rather than increasing the number of new hires. Strengthening employee welfare to create an environment where excellent personnel can work even after retirement is seen as the solution to retaining talent.

This is why Samsung Electronics Chairman Lee Jae-yong recently held a meeting with 15 "2024 Samsung Masters" at the Samsung Electronics Seocho building in Seoul, emphasizing that "technical talent is an indispensable core competitiveness." He also stated, "We will create an environment where technical talent can freely challenge and innovate." From a corporate perspective, creating an environment where talent can thrive has become an urgent priority.

Most large conglomerates ranked high in domestic total asset rankings (business hierarchy) are manufacturers. To strengthen production capacity, they must continuously invest billions to trillions of won in facilities. Business conditions can change rapidly depending on economic fluctuations. In such situations with high management uncertainty, companies generally share a company-wide hiring principle every 3 to 5 years and adjust business activities according to the business divisions (headquarters) of affiliated companies. Especially in sectors like semiconductors and secondary batteries, where large-scale industrial clusters are developed in cooperation with the government, corporate executives and government relations teams share information on government personnel, factory site development status, and capacity (production capability) estimates, and set target hiring numbers by back-calculating capacity estimates just before factory completion.

Samsung announced a specific goal of "hiring 80,000 people over five years" in May 2022 and plans to hire more than 10,000 young people annually until 2026 regardless of performance. Other companies also find it difficult to drastically reduce youth hiring even when business results are poor. However, as industrial trends rapidly change after the Fourth Industrial Revolution, there is a tendency to prefer on-demand hiring systems over open recruitment. An industry insider commented, "Rather than other companies reviving open recruitment systems, it is more natural to watch when Samsung will abolish its open recruitment system."

Focusing on Talent Acquisition Regardless of Age or Nationality

The semiconductor industry is striving to eliminate age and national barriers in talent acquisition. Due to the advanced nature of the industry, recruiting high-level personnel including master's and doctoral degree holders is essential, but the domestic pool is limited. The case of Taiwanese foundry company TSMC, which postponed the operation of its factory being built in the U.S. by one year to 2025 due to insufficient local workforce, serves as a cautionary example.

Samsung Electronics and SK Hynix have removed internal retirement age limits to maximize the utilization of existing personnel. Samsung Electronics’ semiconductor (DS) division has been operating the "Senior Track," a personnel system established last year. The Senior Track allows employees recognized for excellent qualifications and expertise to continue working after retirement age. Within the Senior Track, the Samsung Master system treats technical experts as the company's top employees. SK Hynix introduced the highest position called "Master" in the production workforce responsible for semiconductor equipment maintenance and repair at the beginning of the year. Similar systems such as HE (Honored Engineer) and DE (Distinguished Engineer) are already in place for technical office workers. All these positions are recognized as experts within the company and can work without retirement age restrictions.

Executives are actively involved in attracting overseas talent. SK Group Chairman Chey Tae-won and SK Hynix President Kwak No-jung held a "Global Forum" in Silicon Valley, USA, last June targeting local talent and linked it to the recruitment process. Including the DS division, Samsung Electronics recently conducted foreign experienced professional recruitment in the research and development (R&D) field. This is the first time such recruitment has taken place, indicating that domestic and international barriers are no longer imposed in securing top talent.

Efforts are also made to minimize turnover by enhancing welfare for junior employees. Samsung Electronics operates a regional expert system, and SK Hynix runs the GXP system, both providing employees with overseas management experience. Notably, the GXP system offers training opportunities not only at SK Hynix overseas subsidiaries but also at partner companies such as ASML in the Netherlands, Lam Research and Applied Materials in the U.S., and Tokyo Electron in Japan.

An industry insider said, "Due to population decline and aging, companies face simultaneous demands to increase youth hiring and extend retirement age for older workers. Although each company's personnel systems are confidential and difficult to know precisely, many companies focus on improving corporate culture and welfare systems to minimize the loss of existing talent rather than increasing hiring by investing in labor costs."

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