A report out of The Korea Economic Daily this morning is claiming that Samsung will be slashing 10% of the support workforce at the company's HQ in Seoul. Job cuts are quite a hot trend in the smartphone world right now, with this news coming in on the heels of various cuts at Qualcomm, Sony, HTC, Lenovo, and Motorola.
According to the report, the 10% being made redundant are "support staff" in back-office roles like finance, personnel, and public relations. It's unclear how many such employees there are, but the company's Samsung Town business HQ in Seoul is comprised of three skyscrapers with 44, 39, and 32 floors, respectively. As such, it's likely tens of thousands of individuals may work in these facilities, and theoretically the number of jobs being trimmed could number in the thousands. It's unclear if these cuts would also affect Samsung's huge R&D facility south of Seoul, aka Samsung Digital City.
Additionally, Economic Daily says that Samsung plans to cut 50% of all general expenses (amounting to billions of dollars) next year as part of a company-wide initiative to reduce costs in the face of a highly competitive smartphone market that Samsung is struggling to maintain growth in.
Given the rather massive spending cuts, it does seem feasible that more jobs at Samsung will likely be on the line if smartphone profits don't tick back up next year, something that seems increasingly unlikely in the face of fierce competition from budget competitors in China and other parts of Southeast Asia.
Globally, Samsung's dozens of various arms and sub-corporations employ around 500,000 individuals. Over 300,000 of those are at Samsung Electronics, the division responsible for Samsung's smartphone efforts (amongst many other consumer products).
Samsung has rather vaguely denied the report of job cuts from The Korea Economic Daily, via an unnamed executive speaking to Yonhap News. Samsung says workers are being relocated, not laid off. The article does not comment on the second rumor, claiming that Samsung would seek a 50% cut in general expenses moving forward.
- The Korea Economic Daily