Research on recruitment of new regular workers by nation's top 600 companies

40% of major companies to hire fewer regular workers

The Federation of Korean Industries (FKI) has recently conducted research on recruitment of new regular workers by the nation's top 600 companies in terms of sales. The following is a summary of the research results.

Some 40% of the nation's major large companies are said to hire a smaller number of new recruits as regular workers, while only 14% of them are likely to increase the number. According to a recent survey of top 600 non-financial companies in terms of sales on their plans to newly recruit regular workers in 2013, 39.5% of 157 respondents, or 62 companies, will be hiring new recruits fewer than last year, the number of new recruits by 46.5% of the respondents, or 73 companies, would remain about the same, and 14%, or 22 companies, would hire more people than last year.

Such a drop in new recruits is ascribed to aggravating business conditions at home and abroad. Over 70 of the respondents said they would hire fewer employees due to a business slump. 46.8% of the respondents cited slow business in their sectors as a main reason for reducing new employment. 24.2% of them expected business conditions to be further worsening, and 12.9% replied their internal management conditions could deteriorate.

A sector-specific business downturn can be traced to new regulatory measures. The Fair Trade Commission (FTC), for instance, newly established a regulation that a new convenience store franchisee is not allowed to open business within 250 meters from the existing store. In a recent survey, most convenience store owners hire fewer people as the new regulation actually hinders them from expanding their business.

Meanwhile, as for plans to hire new recruits more, 59.1% of the respondents said they wanted to secure more future talents regardless of their business situation, 13.6% wanted to expand new business, 13.6% said their business size has grown, and 9.1% replied their sectoral business picked up. High school graduates are in a better position to be hired as new recruits than college graduates. 20.6% wanted to employ fewer high school graduates than last year, 72.6% would hire about the same number of high school graduates, while 6.8% planned to hire more this year. Despite the economic slump, many large companies choose to hire more high school graduates to eliminate stereotyped credentials so-called 'specs' in Korean.

Mandatory extension of retirement age to 60 could hurt new recruitment

After the National Assembly passed a bill for mandatory extension of the retirement age to 60 in April this year, there have been worries that even fathers and their sons might be facing fierce competition for employment. Asked about the legislation, 34.2% of the respondents said it would curtail employment of new regular workers from the previous years, while merely 0.6% replied that it would increase employment.

19.9% said that extension of the retirement age would cut down the number of non-regular workers to be newly employed, 78.1% said the number would level off, and 2.0% predicted an increase of 2.0%.