It has been revealed by three insiders with intimate knowledge of the situation, that Samsung Electronics, the leading manufacturer of memory chips, TVs, and smartphones worldwide, is laying off up to 30% of its employees in certain countries.
According to two of the sources reached by the BrandSpur digital news platform, Samsung, a company based in South Korea, has told its global subsidiaries to cut administrative staff by up to 30% and sales and marketing staff by roughly 15%.
According to one source, the plan will be put into effect by the end of this year and will affect jobs throughout the Americas, Europe, Asia, and Africa.
Samsung’s intended worldwide staff decrease was also confirmed by six other people with knowledge of the situation. It is unclear which nations and business units will be most impacted, as well as the approximate number of layoffs. The sources asked not to be identified since the extent and specifics of the layoffs were kept under wraps.
Samsung disclosed in a statement that staff changes made at some foreign locations were common and intended to increase productivity. It added that the programs have no set goals and that its manufacturing employees will not be impacted.
As of the end of 2023, Samsung employed 267,800 people worldwide, with 147,000 of those workers being stationed abroad, according to the company’s most recent sustainability report. The majority of those positions were in manufacturing and development, with 25,100 individuals employed in sales and marketing and 27,800 in other occupations, according to the report.
According to one of the direct sources, Samsung’s India division was already providing severance benefits to some mid-level workers who had left in the previous few weeks, even before the “global mandate” on job cuts was given out approximately three weeks ago. The source went on to say that there may be up to 1,000 workers who must depart the India division.
In India, Samsung has over 25,000 employees. According to a South Korean newspaper this month, Samsung has informed its employees in China about job losses that are anticipated to impact roughly 30% of its workforce at its sales division.
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The layoffs coincide with Samsung’s struggles as pressure on its core businesses grows. Its core chip business has recovered from a severe industry downturn that sent its profit to a 15-year low last year more slowly than its competitors. To overcome a“chip crisis” and catch up to smaller rival SK Hynix in the supply of high-end memory chips used in artificial intelligence chipsets, Samsung replaced the head of its semiconductor division in May.
Continuing, while TSMC has historically led in contract chip manufacturing, Samsung faces fierce competition in the premium smartphone market from Apple and China’s Huawei.
Additionally, a pay strike in India is causing manufacturing disruptions for Samsung, which generates roughly $12 billion in revenue annually. According to one of the people with knowledge of the plans, the job cuts are being undertaken in anticipation of a decline in the market for technology items when the world economy slows down.
Another source claims Samsung wants to increase its profitability by cutting expenses, BrandSpur digital news platform reports.
It was not immediately obvious if Samsung planned to lay off employees at its South Korean headquarters as well. According to one of the insiders, Samsung would find it challenging to fire employees in South Korea due to the politically delicate nature of the matter.
The largest employment in the nation and a vital contributor to its economy is the conglomerate Samsung Group, of which the electronics behemoth is the jewel in the crown. Reduced jobs could also lead to domestic labour unrest.
Recently, a South Korean labour union at Samsung Electronics went on strike for many days in protest of their lack of pay and benefits.
The most valuable stock in South Korea, Samsung Electronics, is trading at its lowest point in sixteen months on Wednesday due to recent earnings predictions being lowered by several experts, who cited a sluggish rebound in demand for smartphones and PCs.
