90,000 Samsung employees ready to strike, and here’s why you should care

The recent price hikes for smartphones risk being only the start of a worrying trend for consumers’ wallets.

Behind this overall increase, driven mainly by the rising costs of RAM memory, a more severe threat to the entire technology supply chain is now looming: a historically large union mobilization in South Korea involving the giant Samsung.

Samsung: the origins of the union mobilization and the demands

The internal situation at the South Korean company has reached a critical level of tension. Fully 93% of the 66,019 workers who participated in the union vote said they were in favor of walking off the job.

Considering that union members account for about 70% of Samsung’s entire workforce in South Korea, which totals about 125,000 people, the numbers describe a potential work abstention of nearly 90,000 people.

Discontent did not arise suddenly, but has its roots in last September, when rival SK Hynix granted significant pay reforms to its workers.

This decision triggered a massive wave of new registrations to Samsung’s internal union, pushing the representatives to demand similar contractual policies. The main demand is clear: remove the current cap on bonuses, currently set at 50% of the annual salary, to instead tie the bonuses directly to operating profits.

However, management firmly opposes this. The company argues that removing the cap would compromise its ability to finance long-term investments and to guarantee returns to shareholders within a semiconductor sector characterized by strong cyclicality.

Dates and the inevitable global repercussions

The protest calendar has been outlined. Workers have planned a large demonstration for April 23. If a constructive agreement is not reached by mid-May, the union will launch a 18-day strike starting on May 21.

The consequences of such a production shutdown would be felt dramatically on an international scale, as the stakes for the industry are extremely high.

According to data from Counterpoint Research, Samsung concentrates in South Korea virtually all of its DRAM memory production and about two-thirds of its NAND chip production.

A prolonged disruption of the local factories would paralyze the global orders of the world’s largest memory-chip producer, with a domino effect on all electronic devices. This would hit consumers’ wallets in the form of further price increases.

Moreover, the block would directly affect the plans of the company’s mobile division. Future foldable smartphones, including the Galaxy Z Fold 8, the Galaxy Z Flip 8 and the anticipated Galaxy Z Wide Fold, are expected for an official unveiling in July. A production halt between May and June would inevitably compromise the assembly and distribution timelines of these new models.

In response to this emergency, Samsung’s official statements have thus far been limited to formal tones, pledging the utmost effort to resolve the pay issue amicably.