Korean banks downsizing workforce

24-Nov-2020 Intellasia | TaiwanNews | 6:02 AM Print This Post

Korean banks are downsizing their workforces and reducing the number of new job openings, as the rapid rise of digital banking has cut lenders’ demand for staff that carry out conventional banking-related tasks, according to data and industry officials.

Data released by the Financial Supervisory Service (FSS) showed Monday that the nation’s four major banks’ total number of employees declined by more than 700, or 1.3 percent, as of the end of the third quarter, compared to the end of 2019.

This was mainly due to the job market paradigm shift brought about by the rise of online banking. Starting this year, the trend has gained more steam, as the outbreak of the coronavirus sparked a nationwide boom in contactless transactions.

With banks placing more emphasis on improving their online platforms, demand for traditional bank clerks has sharply declined among major lenders. They have instead focused on hiring more digital experts in the area of big data, artificial intelligence (AI) or blockchain to take the lead in online banking.

“No specific plans have been fixed over how many officials we are going to hire through open recruitment next year, but the number will be reduced amid falling demand for traditional bank employees,” a source from a financial industry said.

Shinhan Bank, one of the nation’s biggest commercial lenders along with KB Kookmin Bank, plans to hire 250 new employees in the latter half of the year, down from 380 in 2019.

Of note is that the lender has placed an emphasis on enhancing its digital and ICT manpower this year.

KB Kookmin Bank also decided to cut the number of new positions by half during the same period. The lender hired 550 employees in the latter half of 2019, but it plans to recruit just 200 this year.

The decline in the total number of employees was even more evident, as they accepted applications for voluntary retirement late last year and early this year, and did not hire new replacement staff.

“The recruitment paradigm shift is not limited to the banking industry. Almost all other industries will undergo a similar transition period to enhance their digital capabilities and reduce manpower handling traditional, repetitive workloads,” a banking industry source said.

The number of sales offices are also declining amid the rise in digital banking. According to data from the FSS, the number of sales offices operated by the nation’s six major banks reached 5,199 as of the end of June, a decline of 96 compared to the end of last year.

Things were no different for state-run lenders. The Industrial Bank of Korea cut its number of new recruits down to 250 this year from 410 last year. Other major banks ? such as the Export-Import Bank of Korea (Eximbank) and the Bank of Korea (BOK) ? also reduced their recruitment numbers this year.

Eximbank cut new recruitment to 35 this year from last year’s 64. The BOK also slightly reduced its new employee recruitment down to 55 this year from 59 in 2019.



Category: Korea

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