Naver and Kakao Expanding Workforce to Reach 10,000 Employees

"Workforce = Production Facility" Aggressive Hiring
Number of Employees Doubled in 4 Years
Ranked 1st and 3rd as Companies People Want to Work For

[Asia Economy Reporter Buaeri] South Korea's two major portal companies, Naver and Kakao, are experiencing explosive growth, doubling their size. The non-face-to-face (untact) business sector has enjoyed a special boom due to the impact of COVID-19, further accelerating their growth. IT companies, where personnel are akin to production facilities, have aggressively recruited talent across various fields, including developers specializing in big data and artificial intelligence (AI).

Doubled in Size in 4 Years

Analysis of business reports from Naver and Kakao on the 26th confirmed that both companies have approximately doubled their number of employees over the past four years. Kakao surpassed 10,000 employees (including subsidiaries) for the first time last year. The total number of employees in the Kakao community, including subsidiaries, is 10,644. This figure is nearly twice the 5,159 employees in 2016. The Kakao community's workforce increased by an average of 20% annually, with 5,832 employees in 2017, 7,275 in 2018, and 8,601 in 2019.

For Naver, including Line, the number of employees was around 15,000, but following the business integration of Line and Yahoo Japan, Line's employees were excluded. As of 2020, Naver's total number of employees, including subsidiaries, was 6,100. Naver also increased its workforce by about 80% from 3,400 in 2016. Naver's employee count grew by more than 10% annually, with 4,000 in 2017, 4,800 in 2018, and 5,000 in 2019.

Riding the wave of non-face-to-face demand, Naver and Kakao have seen growth in various sectors such as shopping, content, and fintech, and have continued their competition to recruit talent this year. This contrasts with major domestic conglomerates that have closed their hiring doors. According to the Korea Economic Research Institute, six out of ten large companies have no plans for new hires in the first half of this year or do not intend to hire even one person. In contrast, both Naver and Kakao have embarked on record-scale recruitment in the triple digits. Naver began hiring developers for the first half of the year on the 4th and announced plans to hire 900 developers this year alone. Naver Webtoon, which has been actively expanding its global business, started recruiting new employees on the 20th and is hiring experienced developers in triple digits starting that day. Kakao is also recruiting internship positions linked to employment in service, business, and tech fields until the 3rd of next month.

Talent as ‘Production Facilities’

Naver and Kakao are actively recruiting talent because they urgently need development personnel, who serve as production facilities, to infinitely expand their businesses. Both companies, which achieved record-breaking results last year, are expected to maintain solid performance in the first quarter of this year, with Naver posting sales of 1.53 trillion KRW and operating profit of 289.1 billion KRW, and Kakao posting sales of 1.2009 trillion KRW and operating profit of 148 billion KRW. Professor Wi Jeong-hyun of Chung-Ang University's Business Administration Department explained, "For IT companies, developers have a similar meaning to production facilities. While manufacturing has been automated, IT developers' work has not yet reached that stage, so as the business rapidly expands, they continuously recruit talent."

The change in corporate status has also played a significant role in their growth. According to a survey conducted by Saramin, a job matching platform, among 3,270 adult men and women on the companies they want to join, Kakao (16.9%) ranked first, surpassing Samsung Electronics (11.7%). Naver ranked third with 6.1%. Both Naver and Kakao have prepared various incentives to retain talent. The average annual salary of employees at Naver and Kakao exceeded 100 million KRW last year. Naver recently introduced a compensation plan to provide all employees with company shares worth about 10 million KRW annually over the past three years. An industry insider said, "In the past, the 20s and 30s generation preferred stable and solid companies, but the MZ generation (born early 1980s to early 2000s) values a horizontal organizational culture. Moreover, with the recent rapid growth of the IT industry, young talent's interest is focused on these companies."