The Tamesis
Nvidia CEO Jen-Hsun Huang said this week the company should pay workers “as much as possible” when asked about Samsung’s pay dispute at the Computex show in Taipei.
Hwang’s comments came ahead of a visit to South Korea, where Samsung Electronics recently averted a strike by reaching a deal with unions on bonuses.
“I’m not an expert on this,” Huang said. “I think people should get paid as much as they can. Ask my employees — that’s literally what I do.”
“I’m going to pay my employees as much as I can,” he added. “But that’s what I do. That doesn’t mean it’s right.”
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Huang’s Nvidia is an American artificial intelligence hardware giant and the world’s most valuable company. Its stock price has risen more than 1,170% in the past five years amid global enthusiasm for the technology. The massive rally turned many Nvidia employees who held stock options into millionaires almost overnight.
Samsung, which makes memory chips crucial for artificial intelligence data centers, has seen its value and profits soar as global demand surges. The company said in April that in the first quarter Operating profit soared about 750% Compared with the same period last year, its market value exceeded US$1 trillion for the first time this month.
This adds to employee frustration. According to last month’s union agreementAbout 60% of Samsung’s domestic employees are eligible for bonuses of about $330,000 this year, based on market estimates of operating profit.
Hwang is scheduled to arrive in South Korea on Friday and will reportedly meet with companies including SK Group and Hyundai Motor to discuss robotics and So-called “physical artificial intelligence”.
He will also appear on “You Quiz on the Block,” one of the country’s most popular television talk shows, and is expected to enjoy Korean barbecue with leaders of the country’s top tech companies.
Other Samsung employees remain frustrated
Although Samsung’s bonus deal passed high-stakes negotiations, unions representing thousands of the chipmaker’s employees asked a court on Tuesday to annul the agreement.
Under the agreement, about 78,000 employees in the chip unit (out of the company’s 125,000 domestic employees) are eligible for bonuses of about $330,000 this year, based on estimated annual operating profits.
Under the union’s 10-year agreement, which is tied to ambitious performance targets, annual bonuses for semiconductor unit employees will amount to 10.5% of the unit’s operating profits. Bonuses will be paid in stock plus 1.5% in cash.
But the deal left many in the non-chip sector unhappy because they were expected to receive much lower benefits, worth about $4,000.
The minority union, which has about 13,000 members, initially filed for an injunction to try to prevent employees from voting to approve the deal, which ended last week.
Following the approval, “we amended an application for an injunction to suspend the validity of the tentative agreement,” a lawyer representing the minority unions said in a message to AFP.
“Huge” leverage
Samsung’s ongoing dispute with its employees highlights a pressing question plaguing the artificial intelligence industry: Who will benefit from the boom in runaway profits and sky-high valuations at microchip companies?
In the United States, some chip workers with stock options have already become rich and retired early, while in Asia chip engineers are only now taking advantage of their indispensable position in the artificial intelligence supply chain to profit, analysts say.
Neil Shah, co-founder of Counterpoint Research, said that overall, shareholders of AI companies benefit the most from growing profits, followed by company executives and then employees with stock options.
He told AFP that actual chip engineers were actually in fourth place.
But because Taiwan and South Korea have most of the world’s chip manufacturing talent pool, engineers there have “enormous” influence,
“This skilled workforce knows they are indispensable,” Shah said.
Korean writer and researcher Kap Seol agreed in an article in the American magazine Jacobin that Samsung’s strike “will almost certainly become the largest work stoppage in the history of the global semiconductor industry.”
In the chip field, he writes, “high pay and generous benefits tend to foster a sense of privilege and prestige among workers,” “despite their experience of chemical-soaked working conditions, cutthroat competition, and long and dangerous hours.”
Salaries push beyond South Korea
Samsung’s bonus deal has also spurred labor demand across South Korea, with workers in industries ranging from biotech to automobiles to shipbuilding demanding a greater share of corporate profits through bonuses.
There are also reports that neighboring Taiwan is unhappy with the bonuses, especially chip-making giant TSMC, which has seen record profits driven by demand for artificial intelligence.
TSMC said in a statement last week: “As the company continues to grow, we are very confident that the full-year growth rate of employee dividends… will exceed last year’s.”
TSMC boss Wei Zhongxian held a meeting last Wednesday to explain bonuses to employees, and the atmosphere was “calm and friendly,” a TSMC spokesperson told AFP.
Annual bonuses are expected to increase by “more than 30%” year-on-year, he added.
- AFP, with additional editing and input by Vishakha Saxena
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