The number of full-time employees at Hyundai Motor Company and Kia Motors, which are leading Korea’s exports, has plummeted by 2,500 in just six months. Hyundai Motor Company and Kia are continuing their high performance, posting the highest operating profit since their foundation in the second quarter following the first quarter of this year, but the size of the organization is rapidly shrinking. This is analyzed to be the effect of full-scale retirement of baby boomers (born between 1955 and 1974) production workers. In particular, in order to respond to the transition to electric vehicles, Hyundai Motor Company and Kia appear to be reorganizing their workforce structure in a way that does not recruit new workers as much as the natural decrease in production workers such as retirement.
■2,561 regular workers decreased this year… Decreased 5,367 people in two and a half years
According to the results of analyzing Hyundai Motor and Kia’s half-yearly report on the 20th, the combined number of full-time employees at the two companies as of the end of June recorded 96,539 (domestic standard). This is a decrease of 2,561 compared to the end of last year (99,100). By company, Hyundai Motor lost 1,820 people from 64,840 at the end of last year to 63,020 in the first half of this year, and Kia decreased by 741 from 34,260 to 33,519 during the same period.
Even in 2020 alone, the number of full-time employees at Hyundai Motor and Kia exceeded 100,000 at 101,906, but they reduced 5367 in 2 years and 6 months. Of these, 2,561, or half, have decreased in the last half year.
On the other hand, Hyundai Motor and Kia’s management performance continues to be at an all-time high. After ranking third in the global finished car market for the first time last year, it is running fast this year as well. Hyundai Motor’s operating profit in the first quarter was 3,592.7 billion won, and in the second quarter, it recorded 4,237.9 billion won, writing a new record for the first half of the year. Kia also broke new records by posting an operating profit of 2.874 trillion won in the first quarter and 3.403 trillion won in the second quarter. As a result, Hyundai Motor Company and Kia Motors are enjoying an unprecedented boom in the first half of this year, ranking first and second in operating profit among listed companies. In the first half of this year, more than 100,000 applicants flocked to Hyundai Motor Company’s first production job recruitment in 10 years. On the first day of application, job seekers and office workers from all over the country flocked to such an extent that the recruitment website went down, giving rise to the nickname ‘Kingsanjik’ (the king of production workers).
■ Responding to electric car conversion ‘manpower reorganization’
Nevertheless, the reason why Hyundai Motor and Kia’s full-time employees are decreasing is not irrelevant to the electric car conversion. According to an analysis by the Korea Automobile Research Institute, the production manpower required to produce 10,000 electric vehicles is 38% of that of an internal combustion locomotive. When the 100% electric conversion is completed, it means that the production manpower will have to be reduced by more than half compared to now. In response, General Motors ( GM))스포츠토토, Ford and other global automakers have undergone extensive restructuring to convert to electric vehicles. However, Hyundai Motor Company and Kia are not artificially restructuring for a soft landing, and as an alternative, they are reorganizing their manpower structure in the form of natural reduction, not recruiting retirement workers for production workers. Instead, it is drastically increasing new hiring in the software sector, a key field for future cars. In this year’s wage and collective bargaining negotiations, the union is holding out a strike card demanding an extension of the retirement age to 64, but the company is in the position that it can never accept the request for an extension of the retirement age. Last year, the number of retirees at Hyundai Motor Company exceeded 2,000, and Kia also reached 1,000, and this is expected to continue for several years.
There is also an analysis that the increase in turnover of young employees also had some influence. Looking at the voluntary turnover rate disclosed in the Sustainability Report (turnover for voluntary reasons, not for reasons of retirement or dismissal), the number of turnovers at Hyundai Motor Company and Kia Motors last year was 690 and 270, respectively. It is expected that this trend will continue this year as well. An industry insider said, “In the case of research and office workers, dissatisfaction with incentives is higher than that of production workers, and this may have contributed to the increase in the turnover rate.”