Samsung is latest vendor to cut jobs in its network business: Reports – ET Telecom

NEW DELHI: South Korean Samsung is reassigning as many as 700 employees from its Networks Division of its total local headcount of 4,000 to other departments in response to saturation in 5G deployments and the lengthy transition to the sixth-generation (6G) networks, Business Korea reported recently.

“The company’s Network Division has decided to transfer approximately 700 out of its 4,000 domestic employees to other departments,” a representative of South Korea’s ICT industry was quoted as saying in the report.

This contrasts with the strategy adopted by its European counterparts, Nokia and Ericsson, which have also announced job cuts in thousands as 5G equipment sales slow down in markets such as India and North America.

Swedish Ericsson this year said it would reduce its domestic headcount by 1,200 amid “challenging” conditions in the mobile networks market, an announcement that came after it already said it plans to cut 8,500 jobs.

Nokia’s chief executive Pekka Lundmark has previously said the company aims to reduce the headcount to between 72,000-77,000 employees by the end of 2026.

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As per the report, Samsung’s Network Division sales were 3.78 trillion won in 2023 – down by 29.7% year-over-year.

US-based Light Reading, citing a source, reported separately that the local employment laws make it difficult for companies to cut jobs in a straightforward manner. As per a second source quoted in the report, the reassignment program also affects a quarter of engineering jobs, as well as, a tenth of roles in North America.

Representatives from the South Korean company confirmed the existence of such a program to the telecom publication, but declined to divulge further details.

A third source cited in the Light Reading report said that the research & development (R&D) department at Samsung’s networks business has been cut by 20%.