Samsung engineers defect to SK Hynix amid bonus disparity

Engineers at Samsung’s semiconductor division are leaving for rival SK Hynix, driven by a significant disparity in employee bonuses. SK Hynix employees are set to receive approximately $476,000 in bonuses this year, largely due to record profits from high-bandwidth memory (HBM) chips. In contrast, Samsung foundry workers, whose division operates at a loss, are receiving roughly $135,000. The talent war has intensified as SK Hynix, now the global leader in HBM chips, aggressively recruits Samsung staff. Samsung has sought legal injunctions to prevent former employees from joining competitors, citing national security concerns over core technology.

The exodus is particularly acute within Samsung’s foundry division, which manufactures logic chips for clients such as Tesla and Google. While Samsung’s memory division workers are receiving bonuses of roughly $400,000, foundry staff are seeing significantly lower payouts because the division is currently operating at a loss. Employees told MIT Technology Review that Samsung stated it cannot distribute large bonuses to divisions that are not performing well financially. This financial reality has left many workers feeling demoralised, with some noting that future company success may not benefit them directly.

SK Hynix has capitalised on this discontent by aggressively recruiting Samsung staff. According to a survey by the Samsung labour union in June, 81.5% of employees in the foundry division said they wanted to leave for another company within two years. In April, union chief Choi Seung-ho reported that more than 200 union members had already departed for SK Hynix over a four-month period. Workers have shared tips on drafting job applications and are actively monitoring SK Hynix’s job postings, with some even applying for entry-level positions despite their experience.

The shift in market dynamics follows a strategic divergence between the two South Korean giants. SK Hynix doubled down on HBM technology in 2019 when Samsung downsized its HBM team, betting the market would remain niche. The subsequent AI boom supercharged demand for these chips, allowing SK Hynix to become the global market leader. Samsung is now playing catch-up, with experts warning that losing foundry engineers could hinder its ability to integrate logic chips into its memory stacks, a capability SK Hynix currently lacks and must outsource.

Samsung has responded to the talent drain with legal measures. In July, Samsung won an injunction barring two former chip workers from working at SK Hynix for 18 months, arguing that chips are a national core technology requiring protection. The court ruled that such measures were necessary to establish a fair market order in the fiercely competitive semiconductor industry. Despite these efforts, the industry faces a broader shortage of workers, with South Korea expected to need 304,000 semiconductor workers by 2031, highlighting the scale of the challenge for both companies.