[Top 100 Companies Report] ① Growth Without Employment: For Every Regular Employee Hired, 2.6 Non-Regular Employees Are Added

Last Year Employee Count 727,590... Up 0.89% YoY
Regular Employees Increased by 1,865, Non-Regular Employees Increased by 4,962
Hyundai Motor Reduced Regular Employees by 1,162, Increased Non-Regular Employees by 1,869

Meritz Securities Tops Average Employee Salary... Exceeds 200 Million KRW
Many Oil Refining and Chemical Companies Rank High in Salaries

Editor's NoteThe top 100 companies by market capitalization listed on the domestic stock market are like national representatives in sports. They represent each industry in Korea and lead the economy. The expectations of the public are also high. Most people who invest in stocks buy shares of these top 100 companies. Job seekers dream of working at these top 100 companies. Every year, around the time the cherry blossoms bloom, the top 100 listed companies submit their business reports. The purpose is to self-assess how they performed as key players in Korea over the past year and whether they kept their previous promises. Asia Economy has reviewed the health status of these companies based on the business reports submitted by the top 100 companies by market capitalization as of the end of Q1 this year. This is to check if they can continue to lead our economy this year, assess any injuries, and help them understand their strengths and weaknesses compared to other companies.

It is the so-called era of growth without employment. Last year, Korean companies grew without additional hiring. Major companies' sales grew about 20% compared to the previous year, but the number of employees in the top 100 companies by market capitalization increased by less than 1%. The quality of employment also deteriorated. Regular employees increased by 0.27%, but non-regular employees increased by 14.6%.

According to Asia Economy's compilation of the '2022 Business Reports' of the top 100 domestic listed companies by market capitalization as of the end of Q1 this year (excluding investment company Macquarie Infrastructure), the number of employees in the top 100 listed companies last year was 727,590. Employment increased by only 0.89% (6,457 people) compared to the previous year (721,133 people). Despite struggling with COVID-19, our economy grew by 2.6% last year. In May last year, the five major groups?Samsung, SK, Hyundai Motor, LG, and Lotte?announced plans to hire more than 260,000 new employees over five years in line with the new government’s inauguration. However, employment in major companies barely increased.

[Photo by Getty Images Bank]

The quality of employment is also an issue. Last year, the number of regular employees was 689,052, an increase of 1,865 (0.27%) compared to the previous year (687,187). On the other hand, non-regular employees numbered 38,908, an increase of 4,962 (14.6%) compared to the previous year (33,946). This means that for every one regular employee hired, 2.6 non-regular employees were added. This is interpreted as a strategy to reduce labor costs and secure labor flexibility through automation of industries such as smart factory construction, robot introduction, and digital transformation.

The company that increased non-regular employees the most was Hyundai Motor. Hyundai Motor increased non-regular employees by 1,869 last year while reducing regular employees by 1,162. Hyundai Motor was the only company where both regular employee decreases and non-regular employee increases exceeded 1,000. The ratio of non-regular employees to total employees at Hyundai Motor rose from 8.3% in 2021 to 10.8% last year. Hyundai Motor rehires employees who retired after reaching the retirement age since 2019. It is known that about 80% of production workers who retired at age 60 continue working as non-regular employees.

The increase in non-regular employees followed Hyundai Motor with Kangwon Land (685), Kia (648), and Hyundai Construction (339). The company with the highest non-regular employee growth rate compared to the previous year was LG Household & Health Care, reaching 437.5% (from 8 to 43 employees). Hanwha Aerospace (360%), Kangwon Land (255.6%), and LG Display (211.3%) followed.

The company that hired the most regular employees was Samsung Electronics, which added 7,959 employees. Samsung Electronics also reduced non-regular employees by 40. Last year, Samsung Electronics’ regular employee ratio reached 99.5%. Next were LG Innotek (2,157), SK Hynix (1,800), and Hanwha Aerospace (1,611) in terms of regular employee increases. The company with the highest regular employee growth rate compared to the previous year was HLB, recording 119.5% (from 87 to 191 employees). Following were EcoPro (88.4%), Hanwha Aerospace (83.9%), and L&F (45.1%).

Last year, Samsung Electronics was the only company with more than 100,000 employees (regular + non-regular), recording 121,404 employees. Hyundai Motor (72,689), Kia (35,847), and LG Electronics (34,645) followed. Samsung Electronics also hired the most employees compared to the previous year, adding 7,919. In May last year, Samsung announced plans to hire 80,000 new employees across its group by 2026. The companies with the highest employee growth rates compared to the previous year were HLB (119.5%), Hanwha Aerospace (88.9%), and EcoPro (83.5%). Among the top 100 listed companies, 74 increased their number of employees compared to the previous year, 24 reduced employees, and 2 remained the same.

Meritz Securities Average Salary 200 Million KRW... Oil Companies Also Offer Many Salaries in the Hundred Million KRW Range

Among the top 100 listed companies (excluding 11 group holding companies), Meritz Securities had the highest average salary per person. The company's average salary last year reached 200 million KRW. It was also ranked first last year with an average salary of 205 million KRW, marking the highest salary among the top 100 listed companies for two consecutive years. Following was S-Oil employees, who received 171 million KRW, ranking second.

Many companies related to oil refining and chemicals were in the top 10 for average salary last year. Along with S-Oil, SK Innovation (4th place, 153 million KRW) and Kumho Petrochemical (7th place, 140 million KRW) were in the top 10. This contrasts with the previous year when none of these companies were in the top 10.

The company with the highest salary increase rate compared to the previous year was also an oil company. SK Innovation's employee salary rose 62.77% compared to 2021. Second place was F&F, famous for fashion brands MLB and Discovery, with a 55.3% increase. Next were S-Oil (49.04%), Korean Air (29.54%), Hyundai Heavy Industries (29.02%), and Hanwha Aerospace (27.5%).

The company with the largest salary decrease was Kakao (-19.9%). Among the top 10 companies with declining salaries, IT and gaming sectors were the most common. Krafton ranked second with a 13.49% decrease compared to the previous salary. Netmarble (-8.64%) and Kakao Games (-8.61%) ranked ninth and tenth, respectively.

This trend appears to be influenced by industry conditions. Last year, the operating profit of the four major oil companies (SK Energy, GS Caltex, Hyundai Oilbank, and S-Oil) reached 14.1762 trillion KRW. Due to Russia's invasion of Ukraine, international oil prices surged, resulting in the highest performance since their founding. These companies also gave employees bonuses exceeding 1,000% of their base salary.

Among the 11 group holding companies excluded from the statistics due to their small employee size (SK Square, LG, Woori Financial Group, Meritz Financial Group, KB Financial Group, Shinhan Financial Group, HD Hyundai, Hana Financial Group, GS, POSCO Holdings, AmoreG), five are financial companies. These companies often ranked within the top 10 in terms of salary amount and growth rate. The five major financial holding companies (Shinhan, Kookmin, Hana, Woori, NongHyup) posted net profits exceeding 18 trillion KRW last year, reflecting strong performance. This is interpreted as an effect of increased interest income due to the high-interest-rate environment.