Subcontractors of South Korea’s three major shipbuilders may carry out massive job cuts this year on sluggish business conditions, industry sources said Monday.

The shipbuilders -- Daewoo Shipbuilding & Marine Engineering, Hyundai Heavy Industries and Samsung Heavy Industries -- suffered a combined 7.7 trillion won ($6.7 billion) in losses last year, marking the first time that all three posted losses. 

With few new offshore orders in sight, a total of 20,000 employees of subcontractors stand to lose jobs this year once the shipbuilders complete construction of offshore facilities scheduled for delivery next year, the sources said.

Hyundai Heavy Industries aims to bag offshore orders worth $4.2 billion, but its new orders stand at just $151 million. Daewoo Shipbuilding & Marine Engineering and Samsung Heavy Industries have yet to receive any orders this year.

Hyundai Heavy Industries has already given the pink slip to some 1,500 employees of 10 subcontractors working on an offshore project. More layoffs may come when it announces restructuring plans this week.

Subcontractors of Hyundai Heavy Industries are already reportedly reducing daily wages and benefits for day laborers and considering adopting an hourly wage system in a bid to cut costs.

(khnews@heraldcorp.com)