(Yicai Global) May 19 -- In response to media reports this week about staff layoffs, Chinese home appliance maker Midea Group said it will slim its non-core business and suspend non-operational investment for the moment based on its assessment of the external environment.
In information posted on workplace social-networking platform Maimai, the Foshan-based white goods giant did not elaborate on what constitutes non-core business.
Midea’s workforce has burgeoned as business segments continue to grow, the company noted, adding that it hired more than 10,000 new employees last year, an increase of 35 percent over 2020.
At the end of 2021, the manufacturer had 165,799 staff, with salary outlays of CNY9.3 billion (USD1.4 billion).
Media reports have suggested that to save on labor costs and boost profit, Midea plans to shed half its headcount within three years, with 25 percent to 30 percent to go this year. The divisions involved include administration, production, research and development, as well as sales.
Midea’s first-quarter net profit rose 11 percent to CNY7.2 billion on a 9.6 percent gain in operating income to CNY90.4 billion. Last year, profit increased 5 percent to CNY28.6 billion (USD4.2 billion), and operating income jumped 20 percent to CNY341.2 billion (USD50.4 billion).
Editor: Peter Thomas