ContributionEconomic reasons behind Coupang’s hiring of Chinese developers

Coupang Corp. CEO Park Dae-jun answers questions at a National Assembly session on the company’s data leak, Dec. 3. Hankook Ilbo

A former Chinese developer at Coupang was recently identified as a suspect in the company’s large-scale personal data leak. Appearing before the National Assembly, Coupang Corp. CEO Park Dae-jun confirmed that the former employee in question had been responsible for developing the company’s authentication system. The incident quickly triggered criticism online, with many questioning why Coupang had hired a Chinese developer in the first place.

But the hiring of Chinese developers is hardly unique to Coupang. Many companies — not only in Korea but also in Japan — recruit them. The primary reason is simple: Their labor costs are comparatively lower.

Choi Youn-jin

According to reporting from the South China Morning Post and other foreign media, many Chinese developers leave their jobs around age 35 due to heavy workloads and other pressures. China’s tech companies once embraced the so-called “996 culture,” which expects employees to work from 9 a.m. to 9 p.m., six days a week. Although China’s legal maximum workweek is 44 hours, the practice persisted as an industry norm. Only after developers began collapsing from overwork and staging collective protests did the Chinese government officially ban the 996 system. Still, some companies are believed to continue the practice.

Adding to that pressure is China’s youth unemployment rate, which stands at 17 percent. With a large pool of talent constantly available, developers who are not exceptionally skilled struggle to sustain long careers.

As a result — pushed both by circumstance and by choice — many Chinese developers look abroad, particularly to Korea and Japan. In Japan, the average monthly starting salary for new university graduates is around 300,000 yen ($1,920), yet companies often hire Chinese developers for even less. Even so, many find that their Japanese salaries exceed what they earned at Chinese firms, making overseas relocation attractive.

This trend has given rise to a new term in China: "runri." The word refers to the phenomenon of Chinese citizens moving to Japan amid political and economic pressure from the United States, shrinking job opportunities at home and general uncertainty. Middle-class families, intellectuals and young developers are among those relocating. Japan now expects its Chinese resident population — currently around 870,000 — to surpass 1 million next year.

The influx of Chinese developers is having a noticeable impact on labor markets in neighboring countries. Their presence lowers prevailing wage levels and intensifies competition for jobs. Companies argue that cost-cutting is unavoidable. To avoid raising product prices or service fees, they say they must reduce expenses, including labor costs. Consequently, Korean companies — whose developer salaries are higher than those in Japan — have in some cases shifted from hiring Japanese developers to hiring Chinese developers, whose wages are even lower.

For domestic developers, this means fewer opportunities and tougher competition. They now face a dual threat: displacement by artificial intelligence, which can perform tasks including software development, and competition from lower-wage Chinese developers.

In a global labor market where cross-border hiring has become routine, it is unclear how much advice like improving skills can help those whose livelihoods are at risk.

The writer heads the Startuplab at the Hankook Ilbo, where he covers the IT and startup sectors. This column from the Hankook Ilbo, the sister publication of The Korea Times, is translated by a generative AI system and edited by The Korea Times.