Samsung employs more than 147,000 people outside of South Korea, with more than 50,000 in sales and administrative roles.
According to a Reuters report, Samsung is purportedly planning to reduce its global staff by nearly 30% in certain international departments. With this move, the company would join the list of major technology manufacturers that have already reduced their workforce after the hiring boom in the years following the pandemic. However, it’s important to note that the tech giant hasn’t confirmed the Reuters report as of yet.
Samsung employed 267,800 people by the end of 2023, of which about 147,000 were outside South Korea. Reuters reports the cuts would apply to this group of 147,000 employees.
The media outlet also reports that Samsung will reportedly reduce staff by 15% in the sales and marketing departments of its subsidiaries worldwide. Meanwhile, it could cut 30% of its administrative team. The purported cuts will affect the central regions where the brand has a presence, including the Americas, Europe, Asia, and Africa.
The brand’s subsidiaries worldwide employ approximately 25,100 people in sales and marketing departments and approximately 27,800 people in other administrative divisions.
According to sources at Samsung Spain consulted by Xataka, “Some subsidiaries are making routine headcount adjustments to enhance operational efficiency. The company hasn’t set a specific target number for any position.”
The company's spokesperson added that the tech giant’s subsidiary is carrying out these staffing adjustments in Spain to improve operational efficiency, considering factors such as the business environment.
If confirmed, the move would exacerbate the company’s labor conflict at its headquarters, where employees have unionized for the first time in Samsung’s history and have gone on strike twice in recent months.
Leveling the Internal Structure
If the Reuters report turns out to be true, Samsung’s decision wouldn’t be unique and would follow the path already taken by other companies in the technology sector. In short, these companies are trying to level out their internal structure to reduce intermediate positions and decision nodes, thereby streamline internal decision-making.
Meta has been doing this since early 2023, and other companies like Amazon and Google are also applying this recipe. In an interview, Meta CEO Mark Zuckerberg explained why the company had reduced part of its workforce.
According to Zuckerberg, the first reason behind the decision was correcting the overhiring that occurred between 2020 and 2021. During the pandemic, demand for technology products skyrocketed, and companies responded by hiring more people to meet the increased demand.
Now that this demand has stabilized, companies are overstaffed and laying off thousands of workers.
Data collected by consulting firm Bestbrokers shows that in the technology sector alone, there have already been 211,033 layoffs in 2024 and approximately 260,000 in 2023.
Furthermore, Zuckerberg’s attributed the wave of layoffs in tech companies to an attempt to flatten the internal structure at the company, reduce bureaucracy, and streamline decision-making. Moving fast has become a matter of survival for tech companies, which must react immediately to the slightest change in their competitors’ strategy. Failure to do so can condemn them to years of recovery, similar to what's happening to Intel.
This post has been updated to clarify that the purported layoffs are based off the Reuters report and haven’t been confirmed by Samsung.
Image | Samsung
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