Salaries at South Korean Firms Reduce
John Kim, April 1, 2016, 8:09 a.m.
The average salaries at some of the country's biggest companies fell last year. At SK Telecom, for example, the average salary was a whopping W101 million, but that was still down around W1 million compared to the previous year and the first time salaries shrank (US$1=W1,142). The decline was the result of the first dip in sales and operating profit since the company was established.
Business reports to the Financial Supervisory Service by the nation's top 30 companies show that the per-capita wage shrank at five of them. The others were Samsung, Hyundai Motor, POSCO and Amore Pacific. The wage gap between men and women is also widening.
Disappointing earnings are the main reason. At Samsung, which cut average annual wages by W1 million compared to 2014, revenues fell 2.7 percent and operating profit 19 percent. The decrease is mainly the result of declining performance bonuses reflected in the salary statistics.
At Hyundai, sales edged up slightly but operating and net profit fell around 15 percent. That pushed down the average wage by around W1 million to W97 million. At POSCO, which also posted its first-ever loss last year, the average wage also fell W1 million to W81 million. Amore Pacific's sales surged 23 percent and operating profit 37 percent, but the cosmetics giant hired some 900 new staff on low entry salaries, which brought down the average.
The pay gap between men and women is growing ever wider from W28 million in 2014 to W31 million last year. It widened in 20 out of the 30 companies and was almost twice as big as in the seven where it shrank.
Men make more than women in all of the top 30. "The wage gap is mostly due to the high salaries of senior managers who are mostly men," said Keum Jae-ho at Korea University of Technology and Education said. "At the regular staff level, there's hardly any wage gap between genders."
The difference in wages between executives and employees was the highest at Samsung at a staggering 66 times. The average wage of corporate execs was W6.66 billion, and the difference with wages of ordinary staff still fell from an even more staggering 82 times in 2014.