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How Much Compensation Will the Semiconductor Industry Provide to Its Employees?

In the semiconductor industry, where talent development and workforce acquisition are crucial, generous salaries and various welfare programs are the biggest weapons to prevent employees from being poached by competitors and to retain them. How much compensation do employees receive in the global semiconductor industry, which is receiving full government policy support?

TSMC, the world's largest foundry (semiconductor contract manufacturing) company based in Taiwan, paid its employees an average of 3.175 million Taiwan dollars (approximately 137.54 million KRW) last year. This includes not only the monthly base salary but also year-end bonuses and subsidies for employees' stock purchases. This amount is 28.91% higher than what was paid in 2021.

TSMC recorded its highest-ever performance last year with sales of 2.26 trillion Taiwan dollars (97 trillion KRW) and a net profit of 1 trillion Taiwan dollars (43 trillion KRW). It became the most profitable semiconductor company in the world. In 2019, the average annual salary of TSMC employees was about 85 million KRW, falling short of 100 million KRW. However, as a reward for maximum performance, salaries have been increased by double-digit rates consecutively, and now they are on par with leading Korean semiconductor companies such as Samsung Electronics and SK Hynix. Even new employees just joining the company receive an annual salary of about 2 million Taiwan dollars (approximately 86 million KRW) for master's degree-level engineers. This is 2 to 4 times the average salary of Taiwanese workers.

Samsung Electronics and SK Hynix, the top two memory semiconductor companies in Korea, are also known for most of their employees earning annual salaries in the hundred million KRW range. Last year, Samsung Electronics' average employee salary was 135 million KRW. SK Hynix employees received 133.85 million KRW on average. Reflecting worsening business conditions such as the semiconductor downturn, Samsung Electronics set this year's average wage increase rate at 4.1%, lower than last year's 9%. SK Hynix is expected to announce its wage increase rate next month.

Although salaries are lower than those at Samsung Electronics and SK Hynix, DB Hitek, a domestic semiconductor company, has recently been attracting new employees with aggressive salary increases. DB Hitek recently raised the contract annual salary for new employees from 48 million KRW last year to 51.36 million KRW this year, a 7% increase. If a new DB Hitek employee receives the maximum performance bonus this year, the total compensation could reach about 77 million KRW. As a result, the annual salaries excluding performance bonuses for new university graduates at the three major domestic semiconductor companies?Samsung Electronics, SK Hynix, and DB Hitek?have all surpassed 50 million KRW, ranging from 51 million to 53 million KRW.

ASML, a Dutch company known as the "super subcontractor" in the global semiconductor industry, also attracts talent due to its high growth and high salaries. Despite the semiconductor downturn in the first quarter of this year, ASML, a semiconductor equipment company whose sales grew by more than 90% compared to last year, is securing talent by offering exceptional wages in the Asia region, where many semiconductor companies are concentrated. ASML Korea raised the average employee salary by 11.8% this year. Following last year's 18.3% increase, this marks two consecutive years of double-digit wage hikes.

The annual salary for new engineers graduating this year is around 48 million to 51 million KRW. Including performance bonuses, they can earn between 60 million and 70 million KRW. ASML is also building a large factory in Taipei, Taiwan, this year and has offered new employees in Taiwan a salary of more than 1.6 million Taiwan dollars (approximately 69 million KRW). Additionally, female employees with children can take 14 weeks of maternity leave, and male employees can take 10 days of paternity leave. This is longer than the legally mandated maternity leave of 8 weeks for women and 7 days for men.

In mainland China, SMIC, the largest semiconductor company, is known as a "black hole" that attracts semiconductor talent with high salaries. As of the end of last year, SMIC paid its research and development (R&D) staff, who make up more than 10% of its total workforce, an average annual salary of 87 million KRW. As talent concentration at SMIC has intensified, other semiconductor companies in China are competitively raising salaries to prevent employee turnover. In Shanghai, the average annual salary for new semiconductor engineers is currently around 400,000 yuan (approximately 76.9 million KRW), double that of 2018.