According to data from the Financial Supervisory Service on Thursday, the total number of staff members hired at six travel companies listed in the stock market dropped by 39.7 percent compared with June 2019, before the pandemic.
Korea’s largest travel agency, Hana Tour, saw the biggest drop of 52.8 percent. Mode Tour, the second-largest, had to let go of 18.1 percent of its workforce during the same period.
Massive layoffs took place at small and medium-sized travel agencies as well.
Yellow Balloon Tour cut 45.4 percent of its staff, while Red Cap Tour laid off 33.8 percent, Happy Tour 33.3 percent and Very Good Tour 21.8 percent.
Companies are cutting labor to cover revenue losses resulting from COVID-19, which decimated international travel worldwide.
Hana Tour posted 15.9 billion won ($13.59 million) in revenue for the first half of this year, just 16.9 percent of the 2020 figure. Compared with 2019, it was only 3.8 percent.
Employee wages were also reduced. In the first half of this year, per capita labor costs at Hana Tour were halved from a year earlier to 8 million won.
At Mode Tour, the average salary was cut by 56 percent in the first half, to 8 million from 18 million.
Industry officials say firms could continue to cut costs, as the fourth wave of the pandemic dampens hope for a rebound of overseas trips under the government’s travel bubble rule.
“Only around 40 people went on overseas trips after the travel bubble opened in June. Due to the increase in COVID-19 cases, some customers are even canceling their flights. It’s difficult times for the industry,” said one official from a local travel firm.
By Kang Jae-eun ([email protected])