Samsung Electronics is looking at global workforce cuts adding to over 30% of its overseas staff. Despite the launch of multiple successful products over the last few years, the company has seen tough competition from outside and resistance from workers from the inside in recent months. Samsung’s workforce reduction plans for 2024 will affect employees in the Americas, Europe, Asia, Africa.
The job cuts are expected to take place by the end of the year so the workforce overhaul is expected to begin and progress immediately. The organization has also been faced with union-backed protests in South Korea which has added to the strain on the organization but the workers in the region do not face any immediate threats of layoffs.
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Samsung Global Workforce Cuts Expected By The End of the Year
Samsung workforce reduction plans in 2024 will involve major cuts to its sales and marketing department, which has around 25,000 members currently, as well as the administrative team. From the information we have from Reuters, Samsung’s staff cuts in sales and marketing will involve a 15% cut, while admin staff could see reductions up to 30%.
The company reportedly has over 270,000 employees globally, spread across 76 countries. A majority of these jobs are held by production workers, but there is no evidence that their roles will be affected by the Samsung layoffs expected overseas. A company of this scale would require significant efforts to cut down on employees but the final decision on who will be let go will probably fall to the regional leaders.
Some sources suggest that the process has been initiated already, with over 1,000 employees to be impacted in India alone, with mid-level employees having received notifications of the job cuts along with details of their severance package. There are no concrete confirmations of this rumor.
What Are the Reasons for Samsung’s Staff Cuts?
The tech giant has not provided a clear explanation of their reasoning for the job cuts, stating that the workforce adjustments at overseas operations are routine and intended to aid in improving the efficiency of the organization. The real reason for Samsung’s global workforce cuts is likely to be a lot more complex. The company’s smartphones have faced some tough competition in international markets, particularly in China from brands like Huawei.
Samsung’s chip business has also struggled with performing well enough to match up to expectations. The demand for chips that can support AI-powered functionalities has risen exponentially and this has allowed competitor companies to pull ahead of Samsung. The company has been looking into a more sustainable expansion in this business and there are plans for facility expansions in the U.S.
Samsung layoffs overseas have also been linked to the company’s powerful presence in its local economy in South Korea. Cutting jobs locally would damage some of the goodwill the company has earned over the years, making the overseas job cuts a more sensible alternative for them. This doesn’t mean that things have been running smoothly in the country entirely. The National Samsung Electronics Union (NSEU) initiated a large-scale strike against the company recently that did not conclude with any major changes to the system. Samsung is currently facing similar strikes in India.
The Samsung global workforce cuts will likely help the company streamline its business and divest itself of the extra resources and resource personnel.
