2020 Hiring Trends │ Korea

With a deterioration in its cost competitiveness ascribable to the implementation of the 52-hour workweek, another rise in the minimum wage and prolonged US-China trade tensions, foreign direct investment (FDI) in South Korea declined in the first half of 2019. FDI during the same period in 2018 hit a record high, so a considerable part of the perceived decline comes from a base effect. The amount of investment during the first half of 2019 surpassed a ten-year average, indicating that general upward movement continues. Foreign investment was particularly active in areas such as high tech and new industries, which are tech-intensive and generate high levels of added value.

In 2019, the Korean government has decided to focus on and nurture the biotechnology sector, along with future mobility and renewable energy, to lead the country’s economic growth into the future. As a result, the biotechnology industry drew exceptional attention from foreign investors in 2019, with demand for highly skilled talent in this potentially high-growth field remaining strong. In addition, the rapid growth of the biotechnology industry has expanded the market for analytical devices and diagnostics. This has prompted a significant inflow of new foreign investment in the areas of digital-based wearable medical devices, remote diagnostics, research and development facilities for the treatment of rare diseases, and anti-ageing products.

Competition for technology specialists continued to intensify with the development of new business models converging IT and healthcare, as well as an across-the-board digitalisation of various industries. A wave of digital innovation is sweeping across almost all areas including online shopping, unmanned stores, automated logistics and distribution, manufacturing, finance and even agriculture. Thus, demand for subject-matter experts in IoT, artificial intelligence (AI), and big data is expected to experience a surge, regardless of industry. Commercialisation of 5G technology has led to marked growth in services utilising IT, such as mobile platforms. Consequently, the number of new start-ups that offer mobile platforms for advanced consumer services are on the rise.

Demand for new technology skills remains strong in the manufacturing sector, where a transition to smart factories is taking place as part of the Fourth Industrial Revolution. Expertise in AI technology is critical to becoming a leader in the Fourth Industrial Revolution, which involves development of autonomous cars and smart homes. While electric car industries continued to boom, manufacturers of internal-combustion engine vehicles experienced a decline against a backdrop of poor business performance and the closing of their factories in South Korea. With that, the demand for bilingual data scientists, deep learning and autonomous system platform specialists and other experts in the manufacturing field will continue in 2020.

With geopolitical tensions, the semiconductor industry suffered from a decline in capital goods imports and exports due to sluggish facility investment. However, the semiconductor industry is expected to recover in the first half of 2020, as demand from server and smartphone makers is expected to recover and supply and demand imbalances seems to get eased. Conglomerates are now seeking to acquire foreign companies with key materials and components technologies and to establish joint ventures to strengthen their business competitiveness. As such, demand for SoC Design Engineers for high value-added core technologies such as ADAS, IoT, Big Data, and Smart Factory are sought after and they can expect salary increases averaging at 10-20% when changing jobs.

Turning to new and renewable energy, the Korean government has announced the ‘Renewable Energy 3020 Implementation Plan’, with the goal of producing 20% of the country’s energy from renewable sources by 2030. This is part of the administration’s goal to phase out nuclear power in South Korea. With the accelerated introduction of infrastructure for solar, wind and hydroelectric power generation, the demand for top talent in these areas is growing steadily.

With increasing expectations for ‘good working conditions’ and ‘positive corporate culture’ across Korean society, the government introduced new legislation to prevent workplace bullying into the legal domain. A number of changes in existing labour laws continue to be implemented, including amendments to the Fair Hiring Procedure Act and an easing of qualifications for maternity leave and pay support. Therefore, throughout 2020 demand will further increase for HR Business Partners (HRBPs) well versed in the rapidly changing labour environment in South Korea and who can adequately communicate these changes with overseas headquarters.