Survey: only 59 percent of companies to hire new workers

Survey: only 59 percent of companies to hire new workers. April. 13, 2015 07:11. sunggyu@donga.com.

The survey on Korean companies’ new employment plan for 2015 conducted by Korea Employer’s Federation (KEF) showed that only 59.1 percent firms have plans to hire new workers, which is the lowest level in five years.

The survey called “2015 trend for hiring new employees and its perspective” was conducted by the federation of the 377 companies whose number of employees is 100 or higher from March 16 to 27.

According to the survey, 59.1 percent of respondents answered that they have plans for hiring new workers or have already employed some. This was the lowest number since the year of 2010 with 49.4 percent when companies were hit hard by global financial crisis. The number has risen from 63.2 percent in 2013 up to 72.3 percent in 2014 but significantly dropped this year. Some 25.4 percent of responding companies answered, "They have not made employment plans or the plans are flexible," while 15.5 percent said, “No plan at all.”

The most reasons from the respondents were “They can’t feel the economy is recovering (28.2 percent)” and “It is due to extension of retirement age and amount of regular wage (26.9 percent).”

In particular, 36.5 percent of big-sized companies (300 or more employees) pinpointed the extension of retirement age and regular wage as an obstacle for new hiring plans. The reasons seem to be that retirement age will be 60 year old by law from 2016, and their wage system is more affected by seniority (the system that wages become higher as ages or employment years increase) than smaller-sized firms. It turned out that this year, companies would hire 3.6 percent less new employees compared to 2014.