Samsung Electronics’ workers in South Korea go on strike for the first time ever | CNN Business

Seoul
CNN
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A labor union at Samsung Electronics in South Korea said many workers went on strike Friday, marking the first such walkout in the smartphone and chipmaking giant’s 55-year history.

The Nationwide Samsung Electronics Union (NSEU) said last week that its 28,000 members — just under a quarter of the company’s total workforce in the country — would stage a one-day strike on June 7, following failed negotiations over pay and bonus arrangements.

The union asked its members to take a day off on Friday, which falls between a public holiday on Thursday and the weekend.

Son Woomok, a union leader, told CNN that “many employees used their annual leave today,” and at one site “all workers had taken leave so replacement personnel were deployed.” He did not provide other details.

He had previously said many NSEU members work for Samsung’s flagship semiconductor unit. That division is trying to regain its former status as a top semiconductor company, according to Reuters, which says Samsung has fallen behind its competitors SK Hynix and Micron Technology in delivering chips used in artificial intelligence (AI) processors.

A Samsung spokesperson told CNN that, “there is no impact on production and management activities” as a result of the one-day walkout.

“Today’s annual leave use rate is lower than last year’s Memorial Day holiday’s annual leave use rate,” the spokesperson added.

The world’s biggest memory chipmaker has had a rough few years. A historic shortage of computer chips during the Covid pandemic was followed by falling demand last year as consumer appetite for electronics remained weak because of global economic uncertainty.

But things are looking up for the company because of the AI boom.

It is optimistic about a resurgence in demand for mobile devices this year, particularly with the rollout of new products, such as AI-powered smartphones.

Last month, Samsung reported a more than tenfold rise in first-quarter operating profit amid forecasts of high demand for AI and high-end chips, an area in which it competes with Intel (INTC) and Taiwan’s TSMC.

The vast majority of the world’s advanced microchips are made in just two places: Taiwan and South Korea. Taiwan’s industry is larger and more dominant, something South Korea is keen to challenge.