From Developers to Riders... Untact Industry Recruitment War

Delivery App Orders Up ↑ Rider Recruitment Battle... Bonuses Offered for Developer Hiring

[Asia Economy Reporter Kim Cheol-hyun] The competition to secure talent in the non-face-to-face (untact) industry sector has ignited. While companies are focusing on hiring developers to create untact services, fierce competition is also underway to secure delivery workers (riders), who are representative platform laborers in this field. As the untact industry expands due to the prolonged COVID-19 pandemic, the demand for personnel has significantly increased from the stage of building these services to performing them.

According to related industries on the 4th, the value of riders performing delivery tasks in untact sectors such as delivery applications (apps) has recently soared. Each company is competing to recruit riders and has proposed increases in delivery fees for this purpose. Delivery Hero Korea temporarily raised the average delivery fee paid to 'Yogiyo Plus' riders, a gourmet delivery service, to 8,000 won only in the Gangnam and Seocho areas. This is an increase of more than 30% from the previous delivery fee level of around 6,000 won.

The latecomer Coupang Eats is also intensifying efforts to secure riders. Following the expansion of its service to the entire Seoul area in June, it plans to aggressively target the Gyeonggi region starting this month, making rider recruitment an urgent task. Coupang Eats plans to expand its service area from Seongnam City starting on the 4th to Bucheon City on the 11th. Moreover, Coupang Eats operates a system where one rider is assigned to one order, not the 'combined delivery' method that handles 3 to 4 orders at once, and to guarantee the income of riders who cannot do combined deliveries, it has set higher delivery fees. According to the industry, Coupang Eats rider delivery fees range from a minimum of 5,000 won per order to about 17,000 won during the rainy season recently, and sometimes exceed 20,000 won.

In addition, Baedal Minjok (Baemin), the number one delivery app, is also defending its market position by recruiting more than 1,000 additional riders. The number of Baemin riders, currently about 2,100, will increase to around 3,000 after this recruitment. More than half of the new recruitment target has already been met by hiring over 500 new riders. The reason delivery apps are competing to secure riders is due to the increase in delivery orders caused by the COVID-19 pandemic. According to the 'May Online Shopping Trends' released by Statistics Korea, the transaction amount for food services surged by 77.5% compared to the previous year. Especially with the recent summer vacation season and rainy season overlapping, the order increase has become steeper, but rider recruitment has not kept pace with the increased number of orders, causing frequent delays in delivery. Choi Jin-soo, head of two-wheeled delivery operations at Woowa Brothers, said, "Increasing the number of riders is expected to greatly improve delivery quality."

The competition to secure riders is also interpreted as evidence of the increasing labor demand in the untact industry. According to the Ministry of SMEs and Startups, the employment creation effect of untact sector companies in the first quarter of this year was more than three times higher than that of face-to-face sector companies. For example, Coupang's delivery staff called 'Coupang Friends,' who perform untact delivery, doubled from about 5,000 at the end of last year to 10,000 in seven months.

In particular, the untact industry has been steadily competing to hire developers this year. Coupang conducted a public recruitment program for about 200 experienced workers with a signing bonus of at least 50 million won as a joining incentive, and Wemakeprice also publicly recruited a double-digit number of new developers. Fashion startups gaining attention due to the spread of untact consumption are also actively hiring developers. Brandi, a startup operating fashion shopping apps such as 'Brandi' and 'Hybe,' is conducting large-scale recruitment aiming for 100 developers by the end of this year, and Croquis.com, which operates 'Zigzag,' has set a hiring goal to increase its current 160 employees to 250 within the year. An industry official said, "The hiring competition in the untact sector, which started with developers, has now spread to delivery app riders," adding, "With the prolonged COVID-19 pandemic and related industry growth, the demand for personnel in this field is expected to increase significantly in the future."