Monday, November 03, 2003

KT's numbers do not add up

Meanwhile, something is fishy at Korea Telecom. One of the things that is surprising to me when Korea encounters the international media is how often things are ignored because of small amounts of Korea's importance and activity Internationally. Therefore many people probably skimmed this news on results and layoffs at KT with glazed eyes.

However if you do some simple and research math, things curious at KT.  First lets look at the numbers quoted in the article and in a KT statement here:

Jobs Cut  - 5,500 (13% of staff)
One time loss due to jobs - 832 billion won
Savings due to cut - 330 billion won per year
Average Salary of Cut Jobs - 60 million won year per year

Something here does not add up. Exactly who are they letting go for over 150 million won per head? Are these workers really working for 60 million a year? After all GDP per capita in Korea is only about 16 million won, and according to the Korean National Statistics Office (look yourself its too complex to post I think) a worker in telecommunications only makes about 36 million a year.

Again I ask, who are we really talking about. The only one that makes sense when you extrapolate from the industrial data at the NSO is "Senior Officials and Managers". However there is no news from KT on senior officials leaving in 3Q. Something is odd about this layoff.

Finally, something really eerie about the data I am talking about. I am using rough averages since I only have a little time to research and post, but this is too much for me not to note. If you take the rough monthly salary of an average worker and divide it by the rough month salary of a senior manager, you get a multiple of  1.67. If you take that multiple and multiply it by the rough average salary of a telecom worker, you get exactly 60 million won per year. Which is exactly the amount KT expects to save, and pays per worker. Curious, no?


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