Jobseekers shun public companies moving out of Seoul

State-run companies, once nicknamed “companies sent by God,” have suffered huge damage in image and desirability ahead of the relocation of their headquarters to the provinces.

The number of people applying to such companies has fallen, and many young employees are leaving. The reason is a desire to remain in the Seoul metropolitan area.

○ Will any public company not move to a province?

A combined 121 state-run companies in the Seoul metropolitan area will relocate to 10 provincial cities, including Naju in South Jeolla Province and Wonju in Gangwon Province. Many jobseekers not from the region in question seem reluctant to relocate because they would have to move to a province if hired.

Jobseekers have shared their fears over such relocation on major job-related websites such as “Breaking Jobs” and “Those Preparing to Join State-run Companies.” Certain users have shared a list of state-run companies to stay in Seoul on the sites, while others have asked whether to choose a large private company based in Seoul or a state-run institution to be relocated to a province. Most people replied that joining a large private company is better even if one has to retire earlier.

In assessing the status and potential of state-run companies, relocation is the most important piece of criteria for jobseekers. State-run companies in finance to remain in Seoul such as the Bank of Korea, the Financial Supervisory Service, Korea Export Insurance Corp. and Korea Deposit Insurance Corp. topped the list, as did others run by the Seoul Metropolitan Government.

On the other hand, public companies to be relocated to the provinces such as Korea Gas Corp., Korea Expressway Corp., Korea Hydro and Nuclear Power and Korea Electric Power Corp. ranked at the bottom of the desirability list.

Certain jobseekers thus shifted their focus from joining state-run companies to large ones in the private sector or chose to study for the civil service exam. A 27-year-old woman who was looking for a job at a state-run institution after leaving a small company said she was preparing for the civil service exam. “Most state-run companies are moving to rural areas that have no movie theaters and convenience stores,” she said, adding, “So I have to think about getting married. I can’t give up my family, friends and cultural life even if I have to sacrifice good benefits and job security.”

A 26-year-old jobseeker said, “Those who graduated from top schools with a lot of work experience have given up applying to state-run companies. Instead, they`ve switched their focus to large companies in the private sector or finance,” adding, “I think graduates from mid-tier or provincial universities will aim to join state-run companies.”

A source from a state-run company said, “We found that the number of applicants from top-tier universities dubbed as SKY - Seoul National University, Korea University and Yonsei University - has fallen considerably over the past one or two years.”

“The number of applicants from Seoul declined but those who graduated from provincial universities increased after the plan to relocate state-run companies was announced and a groundbreaking ceremony for the new offices was held last year.”

In addition, study materials for the test to join state-run companies are not as popular as before. Kyobo Book, one of the largest bookstores in Korea, said sales of such books have declined since August. Just 7,000 such books were sold last month, down 36 percent from the same month last year.

○ Entry-level employees leaving

Another problem for state-run companies is the departure of many entry-level employees. Getting talented staff is tough because of the falling number of applicants, and even experienced workers are leaving.

One state-run company that plans to relocate to a province has lost more than 10 employees every year since 2008. Twenty-six left in 2010 and 21 so far this year.

A 29-year-old employee who joined the company earlier this year said, “The majority of my colleagues think they need to get a new job while still young. I’m looking for a job in the private sector as well because my girlfriend says she can`t live in a province.”

One state-run company that used to be famous for low turnover lost 14 employees at the same timelast year. A source said, “The number of couples in the company is increasing as many young employees want to get married before moving to a province.”

Many employees with Ph.Ds at a state-run think tank are also looking to switch jobs to stay around Seoul. The Korea Development Institute announced that it will hire more than 10 junior and senior researchers because many had left before the institute`s planned relocation to Sejong City in November next year. As the institute is considered Korea`s top state-run think tank, it is deemed unusual for it to recruit more than 10 researchers at once.

Certain researchers at Korea Energy Economics Institute, whose think tank will move to the southern coastal city of Ulsan, have inquired about jobs at universities and institutes run by conglomerates.

In addition, researchers with Ph.D.s at state-run companies involved in setting up national policies are also said to have collected data to join major private think tanks based in Seoul, such as Samsung Economic Research Institute and LG Economic Research Institute.

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