(EDITORIAL from Korea Times on July 12)

Find amicable solution Labor dispute amid intensifying chip war stokes concerns A group of Samsung Electronics union members initiated an indefinite strike on Wednesday, creating concerns about the possible repercussions on the tech giant as a global chip war escalates among rivals including Taiwan, the United States, and Japan. Led by the National Samsung Electronics Union (NSEU), this is the first strike in the company's 55-year history, coming after a previous strike from July 8-10 and a planned but altered strike from July 15-19. The NSEU explained the collective action was inevitable as the company had shown no intention of holding talks with the union during the initial workout. The union is calling for an annual pay hike of 6.5 percent and a realignment of year-end incentives. The purpose of the current strike is to create a "disruption of production," according to the union. A total of 6,540 workers are participating in the strike, with 5,211 of them coming from the semiconductor manufacturing and equipment sectors. The company denies experiencing any losses from the strike as of Thursday, although continued disruption might become inevitable. This occurs at a pivotal time for Samsung, as it stands ready to take advantage of a semiconductor super cycle following sluggish performance last year. Despite a shortfall of up to 15 trillion won ($10.9 billion) in 2023, Samsung's chip unit achieved an earnings surprise in the second quarter of this year. Currently, the chipmaker's semiconductor lines are operating around the clock, with 70,000 workers running three shifts a day. Given the unique traits of the chip industry, any disruption in production will result in enormous losses. Even with its recent earnings boost, Samsung is contending with fierce competition. The company has fallen behind SK Hynix in the high-bandwidth memory (HBM) market, a key area for the expanding artificial intelligence (AI) industry. Samsung has not yet secured a deal to supply HBMs to Nvidia, the leader in the global AI chip m arket. In addition, Samsung is facing challenges in closing the gap with TSMC of Taiwan in the foundry business, prompting a recent CEO change. Considering the semiconductor industry's crucial role in the national economy, the ongoing strike could have serious repercussions for both Samsung and Korea's economic health. In the midst of fierce global competition in the chip market, where major countries are battling for supremacy, the strike at Samsung Electronics - the largest company in Korea - could set back attempts by the chipmaker to restore confidence among clients and investors, as highlighted by various international media. The recent recovery in the semiconductor industry will become a significant turning point that will determine the winners and losers in the global chip market, depending on how they respond to the challenges. Any failure to cope with the challenges will harm both the unionized workers and the company. While workers have the right to strike, they must consider the broader implicat ions of their actions on the global chip battle. TSMC, Samsung's arch rival in the global market, has made significant strides in the foundry market and has become the world's No. 1 foundry company in terms of market capitalization. Samsung reports only 3,000 workers are taking part in the strike out of 70,000 employees. But it is crucial for both the union and the company to understand that shareholders can assess the situation differently. It is now time for the labor activists to seek ways to terminate the strike while the company explores amicable solutions. The current recovery in the semiconductor industry offers a crucial moment for determining the fate of the chip firms based on their response to these tasks. It is imperative for both sides to meet halfway and end the dispute soon. Together, they need to roll up their sleeves and double their efforts to sharpen the firm's competitive edge in order to survive amid ever-intensifying global competition. (END) Source: Yonhap News Agency