Pharma CEOs consider job cuts and reducing hiring in 2024

13% consider reducing employment, 12% consider reducing workforce

[New Year’s Feature] Pharmaceutical and Bio Industry CEO Survey ④ Employment Plans for 2024

Response that they will ‘increase hiring falls from 15% last year to 9% this year…plans to ’reduce hiring rose from 11% to 13%

Of the 53 Pharma and Bio CEOs that responded to the survey, 2 responded that they ‘plan to reduce workforce,’ and 4 responded that ‘the option is under review’

13% of pharmaceutical and bio company CEOs have announced plans to reduce employment this year.

 

Apart from this, another 12% have indicated the possibility of reducing their workforce this year.

 

Overall, the industry held a more cautious stance toward hiring this year.

 

Compared to last year, the number of respondents who responded that they will increase hiring decreased, while the number of CEOs who plan to decrease employment has increased.

 

Such figures suggest that the prolonged economic recession has deepened CEOs' concerns about hiring.

 

Pharma CEOs more cautious about ‘expanding employment’…...15% last year→9% this year According to Dailypharm's 2024 survey of 53 CEOs in the pharmaceutical and bio industries on their plans for hiring in 2024, 77% (41 respondents) answered that they plan to keep hiring at the same level as last year.

 

Only 9% (5 respondents) plan to increase hiring, and 13% (7 respondents) plan to decrease hiring.

 

This differs from last year's employment plans of the companies.

 

When asked how they expect employment to change compared with 2023, 74% (39 out of 53 CEOs) said it will ‘stay the same’, 15% (8) said it will increase, and 11% (6) said it will decrease compared with the previous year.

 

Compared to the previous year, the companies’ inclination to expand hiring decreased from 15% to 9%, and their inclination to maintain hiring decreased from 77% to 74%.

 

On the other hand, plans to reduce hiring increased from 11% to 13%.

 

In just one year, plans for increasing or maintaining employment as is had decreased while plans for reducing hiring increased among the surveyed companies.

 

Companies that performed worse last year were more likely to reduce employment this year.

 

In fact, of the 6 CEOs who rated their company's performance as "poor" or "very poor" last year, 3 said they would reduce hiring this year.

 

The other 3 said they would maintain their hiring levels.

 

Only 1 CEO rated last year's business performance as "good" but said they would reduce hiring this year.

 

When asked about the possibility of layoffs this year, 4% ‘is planning,’ 8% ‘is considering' reducing workforce Regardless of whether or not they are reducing hiring, 12% (6 out of 53) of respondents said they have ‘plans to reduce’ or ‘are reviewing reducing’ their workforce this year.

 

Of these, 4%(2 respondents) clearly stated that they had plans to reduce their workforce, and 8% (4) said they were considering it.

 

The remaining 89% (47) said they had no plans to reduce the workforce.

 

Responses to the question of potential layoffs, the responses were consistent among domestic and multinational pharmaceutical companies, as well as large and small pharmaceutical companies.

 

Of the 6 companies planning reductions, 4 were domestic pharmaceutical companies and 2 were Korean subsidiaries of multinational pharmaceutical companies.

 

Also, the responses came 3 each from large and small pharmaceutical companies.

 

While the majority of respondents have no plans to reduce their workforce, it is expected that the wave of restructuring in the pharma and bio industry that started last year may continue this year, with some companies taking the lead.

 

Among domestic pharmaceutical companies, GC Biophamra, Ildong Pharmaceutical, KyungDong Pharm, Yuyu Pharma, Aprogen Pharmaceuticals, and Genome & Company started restructuring last year.

 

Among the Korean subsidiaries of multinational pharmaceutical companies, MSD Korea, Pfizer Korea, and Novartis Korea conducted restructuring last year, and Sandoz withdrew its service in Korea.

 

In particular, the restructuring decisions of large pharmaceutical companies like GC Biopharma and Ildong Pharmaceutical have spread anxiety across the pharma-bio industry.

 

Both companies had received poor business reports last year.

 

This raises concerns that the restructuring trend could spread across the industry if this year's results are weaker than expected.

 

Hiring area priorities, Sales/Mareketing >R&D>Manufacturing/Control Amidst the overall hiring atmosphere, CEOs have forewarned plans that they aggressively hire for sales and marketing positions.

 

Of the 53 respondents, 43% (23) said sales and marketing will be their top hiring priority this year.

 

This was followed by 36% (19) in R&D, 13% (5) in production management, then 8% (4) in other roles.

 

No respondents chose finance/accounting or IT/security.

 

By company size, large and small/mid-sized pharmaceutical companies differed in their hiring plans for production management positions.

 

18% (6 out of 35) of the large pharma respondents indicated that they are prioritizing production management positions, compared to 1 out of 17 among small and midsize pharma respondents.

 

Large pharma (38%) and small pharma (35%) were similarly likely to prioritize hiring R&D positions.

 

There was no significant difference between large pharma (41%) and small pharma (53%) in their plans to focus on sales and marketing roles.