GEOJE — The city of Geoje in South Gyeongsang Province has asked Samsung Heavy Industries and Hanwha Ocean to fully review their plans to expand design workforces in Busan, warning that Geoje could lose the core functions of the shipbuilding industry and be reduced to a simple production base.
Geoje Mayor Byun Kwang-yong held a press conference on the afternoon of the 2nd to request a full review of the memorandums of understanding on design center expansion that the two shipbuilders are pursuing with the Busan Metropolitan Government, along with their plans to hire new staff there. He also urged the companies to explain and discuss the impact on local employment and the economy with the community before proceeding with any review.
According to the city, about 2,000 of the two shipbuilders' design personnel currently work in Geoje, while roughly 350 work in Busan. Samsung Heavy Industries plans to recruit about 130 more in Busan by 2030, and Hanwha Ocean about 400 more by 2029, the city said.
"We fully sympathize with the need to secure top talent and strengthen design and research and development functions to bolster the competitiveness of the two shipyards," Byun said. "But if top talent keeps flowing out of Geoje, where the production base and core worksites are located, it is plain to see that Geoje will lose the core functions of the shipbuilding industry and be reduced to a simple production base."
Byun stressed that the two shipbuilders' return to the ranks of global shipbuilding leaders came not only from the efforts of the companies and their workers but also from the contribution of a region that endured a long downturn and employment crisis. "Even now, with the shipbuilding industry on the mend, the local economy has hardly escaped the slump, and the two shipyards' efforts toward shared growth with the region also fall short of residents' expectations," he said. "What Geoje residents want is not one-off support or charitable favors. We need shared growth in the true sense, in which the growth of the shipbuilding industry translates into local jobs and spending, and companies and the region grow together."
Byun asked that, if expanding the design workforce in Busan is unavoidable, the companies present a plan to hire a fixed share of directly employed on-site workers each year. He also announced measures by the city itself. Geoje will review ways to improve living conditions, including housing, transportation, education, culture and medical care, and plans to prepare municipal support — office space, education and training, links with local universities, and settlement assistance for workers — on the premise that design staffing in Geoje is expanded.
The mayor also formally requested meetings with Samsung Electronics Executive Chairman Jay Y. Lee and Hanwha Vice Chairman Kim Dong-kwan. "I want to meet the groups' top management directly to convey the region's concerns over the split in design personnel and to draw up concrete measures for shared growth between Geoje and the companies," Byun said.
The two shipbuilders, for their part, said they are not moving functions out of Geoje. Hanwha Ocean said it is "reviewing a plan to set up a design hub office in Busan, but nothing has been finalized." The Busan design hub, it added, is "not a transfer of Geoje's functions but a supplementary means to secure a broad pool of top talent in the southeastern region and raise the production and construction competitiveness of the Geoje yard." The company said it would connect the shipbuilding capabilities of South Gyeongsang Province and Busan around the Geoje yard to drive joint growth of the industry in the southeast.
Samsung Heavy Industries said its Busan R&D center is "not a relocation of Geoje personnel or a reduction of functions, but a measure to supplement and expand specialized design staff in the offshore field, which is difficult to secure." The scale of hiring under review is limited compared with the company's total design workforce and has nothing to do with shrinking Geoje's design and production functions, it said.
