According to Asia Today, the main battlefield of semiconductor competition has shifted to the war for talent. To maintain its position as the market leader, Samsung Electronics has moved to protect its core talent. Meanwhile, global competitors including Micron and SanDisk have entered South Korea to recruit specialists in high-bandwidth memory (HBM) and NAND flash design. Securing sufficient core talent that shapes technological gaps has become the deciding factor for the next-generation memory market.
Reports state that Samsung Electronics is responding by raising performance bonuses and expanding equity awards. In the first half of this year, its headcount edged down from last year, yet total compensation and book compensation costs rose. In addition, Samsung plans to issue extra equity awards tied to the performance of its Device Solutions (DS) division, which houses its semiconductor business. The intensifying talent competition is expected to drive upward pressure on Samsung’s labour costs.
Industry sources indicate that U.S. NAND flash firm SanDisk has recently been actively recruiting core R&D professionals in Seoul for NAND system architecture, core design and solid-state drive (SSD) firmware. Prior to that, U.S. memory vendor Micron opened positions in Seoul to recruit senior HBM design engineers, joining the race for South Korea’s domestic semiconductor talent.
Driven by expanded investment in AI data centres, demand for HBM, high-performance NAND flash and enterprise-grade SSDs has grown concurrently, heating up the global talent competition among memory manufacturers. South Korea hosts a pool of professionals in DRAM and NAND design and process development centred on Samsung Electronics and SK Hynix, making it a key market for overseas firms to source core R&D manpower.
As talent competition intensifies, compensation packages for semiconductor engineers worldwide have surged. Micron rolled out hefty incentives for its employees in Taiwan, China this year. Based on fiscal 2026 performance, eligible staff may receive bonuses equivalent to up to 68 months of salary. Reports show the average total compensation for junior local engineers can reach NT$3.4 million (approx. CNY 722,000 at current exchange rates).
Samsung Electronics has also increased remuneration for core talent to retain key staff. According to Samsung’s half-year report, the company had 129,200 headquarters employees in the first half of this year, down roughly 300 from 129,524 in the same period last year. However, total employee compensation rose from KRW 7.5013 trillion (approx. CNY 37.394 billion) in the prior-year period to KRW 8.0121 trillion (approx. CNY 39.94 billion), representing a 6.8% increase.
The growth in “compensation expenses” recorded in financial statements is even more striking. In Samsung Electronics’ standalone financial statements, compensation expenses hit KRW 25.7659 trillion (approx. CNY 128.443 billion) in the first half of this year, about 3.1 times the KRW 8.4319 trillion (approx. CNY 42.033 billion) booked in the same period last year. This accounting metric differs from actual cash wages paid, covering accrued long-term performance bonuses, equity awards and other incentives recognised in the period. While it cannot be directly compared to cash disbursements, the expansion of performance and equity awards signals rapidly rising book labour costs.
Notably, Samsung has ramped up equity awards to prevent the departure of top existing talent. In the first half of this year, to “retain and motivate outstanding employees”, the company committed to granting 1,777,305 ordinary shares to staff. Based on fair value at the date of agreement signing, the total value stands at KRW 370.568 billion (approx. CNY 1.847 billion). Part of the shares were issued in the first half, with the remainder scheduled to vest progressively by 2028.
Samsung Electronics is shifting the focus of its incentive costs from hiring new recruits to stabilising existing talent. These awards are primarily designed not for new hiring, but to retain key personnel and encourage long-term employment. Faced with global memory firms targeting South Korea’s core design talent, Samsung has formally entered the compensation war to stem talent outflow.
Additional performance-linked rewards are also on the agenda. Samsung Electronics has decided to grant restricted ordinary shares to DS division employees for this year, equivalent to a certain percentage of the division’s 2026 operating results. Detailed terms are still under negotiation, and the awards will be issued once final full-year operating results are confirmed.
Previously, under a labour-management agreement, Samsung Electronics granted equity awards to employees in its Device eXperience (DX) division and CSS business team, valued at KRW 332.7 billion (approx. CNY 1.659 billion) at fair value on the contract date. With the memory industry on an upturn and rising compensation within the DS division, calls to narrow pay gaps from other business units such as DX may grow, creating another layer of pressure for Samsung. The company must protect its core semiconductor talent from poaching by external competitors while maintaining pay equity across business divisions.
The labour union has pushed for separate negotiations to reflect the divergent interests of the DS and DX divisions. Caught between global talent competition to retain core staff and the need to manage inter-divisional pay gaps, Samsung Electronics will most likely face continued increases in talent retention costs going forward.
(Reprinted from https://news.eccn.com/）