Samsung Electronics Reaches Tentative Wage Deal, Averting Strike

Samsung Electronics has reached a last-minute tentative wage deal with its largest labor union, temporarily averting an 18-day strike that threatened to hit the global memory-chip supply chain at a time of already tight AI-driven demand.

The agreement was reached after government-mediated talks just hours before 48,000 workers were due to walk out, Yonhap reported on Thursday. Union leaders said they would put off the 18-day strike while members vote on the tentative deal from May 22 to 27, meaning the immediate threat has been delayed rather than removed.

The dispute centers on how Samsung’s AI-era windfall should be shared with workers. The union had demanded that 15% of Samsung’s annual operating profit be allocated to employee bonuses and called for the removal of a cap on wage bonuses.

The tentative agreement reportedly includes a revised bonus system and a 10.5% share of operating profits for semiconductor workers.

The planned strike drew global attention because Samsung is not just South Korea’s biggest company but one of the world’s most important memory-chip suppliers. The company accounts for around 36% of the global DRAM market and 28% of the NAND flash market, according to TrendForce figures, making any disruption at its Korean plants a potential shock for AI servers, data centers, smartphones, laptops, and other electronics.

With AI demand already straining the memory market, analysts had warned that an 18-day strike could disrupt as much as 4% of global DRAM supply and 3% of NAND flash supply, worsening shortages and pushing prices even higher.

The stakes were also high for South Korea’s economy. Samsung is a pillar of the country’s export machine and financial markets, with reports estimating that a prolonged walkout could have cost the company up to 1 trillion won, or around $660 million, per day and reduced South Korea’s GDP growth by as much as 0.5 percentage points.