Samsung Also Raises Wages by 9%... Electronics and Semiconductor Industry Wage Increase Rate 8~9% (Comprehensive)

[Image source=Yonhap News]

[Asia Economy Reporters Sunmi Park and Jinho Kim] Leading domestic electronics and semiconductor companies such as Samsung Electronics, SK Hynix, and LG Electronics are setting wage increase rates at around 8-9%.

On the 29th, the Samsung Electronics labor-management council announced through a morning employee notice that "the average wage increase rate for all employees in 2022 has been decided at 9%." The average wage increase rate refers to the growth rate of the total annual salary budget paid to all employees, determined by adding individual performance-based increases to the base increase rate. Accordingly, the wage increase level may vary depending on individual performance ratings.

Initially, the labor-management council demanded an increase rate of over 15% from management, but considering various internal and external economic conditions, they reportedly reached a consensus close to double digits. This is 1.5 percentage points higher than last year's 7.5%, which was the highest increase rate in the past decade. With this agreement, wages for individual employees may increase by up to 16.5% depending on their performance ratings. The first-year salary for new university graduates is also expected to rise to around 51.5 million KRW.

Three days of paid leave will also be newly established. The labor and management agreed on welfare measures including the introduction of three days of paid leave to improve employees' work-life balance and the extension of spouse childbirth leave from 10 days to 15 days.

With Samsung Electronics deciding on an average wage increase rate of 9%, SK Hynix, which has not yet finalized its 2022 increase rate, is highly likely to adopt an increase rate around 8-9%. This is due to fierce competition between Samsung Electronics and SK Hynix for securing semiconductor talent in a limited labor market. SK Hynix had already set last year's increase rate at 8.07%, double that of the previous year. Accordingly, the starting salary for new employees at that time was adjusted to 50.4 million KRW, higher than Samsung Electronics.

Foundry (semiconductor contract manufacturing) company DB Hitek recently raised the starting annual salary for employees from 42 million KRW to 48 million KRW, a 14.29% increase, drawing attention. The performance bonus cap was also raised from 33% to about 50% of the annual salary.

LG Electronics also agreed last month on an average wage increase rate of 8.2% for 2022. Accordingly, this year’s starting salary for new employees at LG Electronics rose by about 3 million KRW from last year to 49 million KRW. LG Electronics had maintained an increase rate around 4% annually from 2018 to 2020 but set the highest rate since 2000 at 9% last year and has kept a high increase rate in the 8% range this year. Additionally, welfare benefits were improved, including extending parental leave from one year to two years.

This content was produced with the assistance of AI translation services.