Large-scale investment projects by Korean companies currently underway in the United States are facing greater-than-expected pressure from labor costs. Due to a shortage of skilled workers, some companies have hired local welders, with daily wages reaching as high as 700,000 KRW. Although the visa situation has improved to some extent, making it easier to dispatch workers, the rapidly rising cost of securing skilled local labor has emerged as a hidden obstacle, significantly increasing construction expenses. With ongoing labor cost pressures and a shortage of skilled workers, construction delays have become a reality at some factories in the United States.

According to industry sources on November 19, Samsung Electronics, which is building a foundry (semiconductor contract manufacturing) production line in Taylor, Texas, has paid local welders up to $480 (approximately 700,000 KRW) per day. This amounts to nearly 15 million KRW per month. Compared to Korean welders, who typically earn an average daily wage of 180,000 to 250,000 KRW, this is 2.5 times higher. An industry insider commented, "Some even joke that it would be better to quit their current jobs and move to the U.S. to work as welders."

Cost of Securing Local Skilled Labor
Emerges as a 'Hidden Obstacle' in Construction Expenses

Monthly Deposits Around 15 Million Won
2.5 Times More Than Domestic Welders

According to data from Ziprecruiter, a U.S. employment website, the average hourly wage for welders in Texas is between $21 and $27 (approximately 30,700 to 39,500 KRW). It has been reported that Samsung Electronics pays local welders the average wage in Texas plus various allowances.

Among skilled local workers, experts in electrical wiring and welding are commanding especially high wages. As global demand for electricity surges, there is a high demand for major work such as power facilities and electrical wiring, but it is difficult to find qualified personnel.

Subcontractors supplying construction workers for the LG Energy Solution plant in Georgia are facing similar challenges. A representative from a subcontractor that supplies local construction workers explained, "Local Americans and Korean specialists with visas earn $45 to $60 per hour (approximately 65,800 to 87,800 KRW), while assistants are paid about $35 per hour (approximately 51,200 KRW)." He added that it is not easy to secure skilled expert labor in a timely manner.

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BlueOval SK, a joint venture between SK On and Ford Motor Company, is recruiting battery plant maintenance technicians at hourly wages of $32 to $38 (approximately 46,700 to 55,400 KRW). The hourly wage for maintenance assistants is set at $27 to $30 (approximately 39,400 to 43,800 KRW).

The minimum wage in the United States varies by state, and the amounts are generally high. As of now, the federal minimum wage for U.S. workers is $7.25 (10,561 KRW) per hour, but in most states, it exceeds $15 per hour. As of August last year, Seattle had the second highest minimum wage in the world, ranging from $17.25 (24,244 KRW) to $19.97 (28,067 KRW). Washington State came in fourth at $16.28 (22,051 KRW). An industry official noted, "In large, advanced countries like the United States and Australia, there are relatively few people available for the many jobs, which drives wages up. In such societies, labor is scarce, so wages inevitably soar."

LG Energy Solution Factory Construction Site Similar
Local Americans and Korean Experts with Visas
Hourly Wage Around 60,000 to 80,000 KRW

Labor Cost Burden Continues Even After Factory Completion
Trump Demands 'Direct Employment of Americans'

Dispatching Domestic Experts Is Also Difficult
As SK in Yongin and Samsung in Pyeongtaek Begin Investment
Skilled Workforce Needed Domestically as Well

Since it will be unavoidable to hire locally even after factory completion, the burden of labor costs is expected to continue. The Trump administration's strong demands for the 'direct employment of Americans' from the construction to the operation stage have also been cited as a factor increasing the burden on companies.

Even if the visa issue is resolved and companies try to dispatch skilled workers from Korea, the situation remains difficult. A representative from a major subcontractor said, "There was the visa crisis, and now, with investments ramping up at SK in Yongin and Samsung in Pyeongtaek, skilled workers are needed domestically as well. There are no more specialists willing to go to the United States."

Some predict that there may be room to reduce labor costs through wage negotiations, but this is seen as unrealistic. Proposals to persuade American workers by offering wages similar to those of Korean workers have also been discussed, but given the strong perception of the minimum wage in the local labor market, the industry believes this approach is unlikely to be effective.

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One suggested strategy is to pay local workers in U.S. dollars, acquiring large amounts of dollars in advance when the exchange rate is low and using them exclusively for labor costs. Attorney Oh Kyungsik of Dentons Lee LLC commented, "The United States is a challenging place for companies from China and other countries to operate factories, as the standards for prices and minimum wages are very different. Korean companies will try to adjust labor costs as flexibly as possible, but if the U.S. government tightens regulations, it will be difficult to avoid these challenges."