Large firms set to cut hiring in H2 on global uncertainty, profitability slump

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Large firms set to cut hiring in H2 on global uncertainty, profitability slump

Published: 11 Sep. 2025, 17:06 Updated: 11 Sep. 2025, 17:46

Audio report: written by reporters, read by AI

Students look at job listings posted at a university in Seoul on Sept. 10. [YONHAP]

Korea’s large companies are set to scale back hiring in the second half of the year compared to a year earlier, according to a survey released Thursday.

The Federation of Korean Industries (FKI) surveyed 121 companies among the country’s top 500 by sales, among which 62.8 percent said they either had no plans to hire or had yet to decide, up 5.3 percentage points from 57.5 percent a year ago.

Within that group, 24.8 percent said they would not hire at all, a 7.3 percentage point increase from a year prior, while 38 percent said their plans remain undecided, down 2 percentage points.

Of the companies that had drawn up recruitment plans, 37.8 percent said they would cut back in numbers compared to last year, while 24.4 percent planned to expand. The remaining 37.8 percent said they would keep hiring at the same level.

The share of firms planning to reduce hiring jumped 20.2 percentage points from last year. The proportion expanding also rose, though by a smaller 6.8 points.

The FKI said the survey results highlight a broader slowdown of the employment market.

“The increase in companies without any hiring plans and the doubling of firms planning cutbacks raise concerns about a contraction in the overall market,” the institute noted.

Students walk past a job board at a university in Seoul on Sept. 10. [YONHAP]

Hiring weakness was most visible in construction and civil engineering, where 83.3 percent of firms reported no or undecided plans. Food makers followed at 70 percent, then steel and metals at 69.2 percent, and petrochemicals and related products at 68.7 percent.

Companies that planned no or fewer hires cited tight management due to growing uncertainty at home and abroad and worsening profitability, which accounted for 56.2 percent of responses, as the leading reason. Rising raw material and labor costs accounted for 12.5 percent, while a weaker global economy combined with a strong dollar made up 9.4 percent.

By contrast, those intending to expand hiring pointed to securing future talent, cited by 45.4 percent, rising demand in new industries and job categories at 36.4 percent, and filling vacancies from attrition at 18.2 percent.

Still, employers highlighted difficulties in the recruitment process, such as a shortage of suitable candidates, which accounted for 29.4 percent, early resignations at 24 percent, dropouts during hiring at 19.3 percent, and excessive applications from unqualified job seekers at 14.7 percent.

The most difficult positions to fill were researchers and developers at 35.9 percent and professional and technical workers at 22.3 percent.

When asked what policies would help expand graduate hiring, companies called for easing regulations to boost investment and employment, cited by 38.9 percent, as well as incentives for job-creating firms at 22.3 percent. They also emphasized support for emerging industries and reducing mismatches between job seekers’ skills and company needs, both at 10.7 percent.

“Traditional industries have lost vitality, and new industries are not yet competitive enough to drive hiring," said Lee Sang-ho, vice president of the FKI’s economic and industrial research division. "The government and National Assembly must support companies’ hiring capacity through regulatory easing and investment support.”

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
BY JEONG JAE-HONG [[email protected]]