On April 23, 2026, the normally bustling campus of Samsung Electronics in Pyeongtaek, Gyeonggi Province, became the stage for a powerful rally. Union members gathered, voices raised and banners unfurled, as they announced their intention to strike in May—a decision that has since sent ripples through South Korea’s business and policy circles. But as the dust settles from the rally, a far deeper concern is emerging: the looming strike is not just about wages or bonuses. According to a chorus of industry experts and academics, it threatens to inflict wounds that could take years—or even decades—to heal.
At the heart of this growing anxiety is the warning delivered by Song Heon-jae, professor of economics at Seoul City University, during a seminar at the Anmin Policy Forum on April 26. Professor Song’s analysis, reported by Hankyung, JoongAng Ilbo, and Yonhap News, paints a sobering picture. If the strike goes ahead and halts production, the losses could be staggering: "Production losses could be tens of billions of KRW per minute and about 1 trillion KRW per day," he estimated. Should the walkout drag on, the semiconductor division alone might see operating profits decline by as much as 10 trillion KRW.
Yet, Song and other observers argue that these visible losses are only the tip of the iceberg. The real peril, he says, lies in the “invisible costs”—the kinds of damage that don’t show up immediately on a balance sheet but can undermine a company’s very foundation. These include the erosion of customer trust, the loss of key clients, and a forced reorganization of global supply chains. "The greater risk lies in invisible costs such as loss of customer trust, client attrition, and supply chain restructuring, which could damage corporate competitiveness long-term," Song emphasized, according to JoongAng Ilbo.
Why are these risks so acute? The answer, Song explains, is the nature of the semiconductor industry itself. For decades, Samsung Electronics has built a reputation for reliability and stability—qualities that global technology giants like AMD and Nvidia now treat as non-negotiable. Both companies, as Song points out, have integrated supply chain stability into their core supplier evaluations and ESG (Environmental, Social, and Governance) criteria. "AMD incorporates supply chain resilience into ESG evaluation, and Nvidia directly applies supplier evaluation results to volume allocation," Song noted in Yonhap News. In this high-stakes environment, even a brief disruption can prompt customers to seek alternative suppliers, such as TSMC in Taiwan. And once those relationships are severed, the costs and complexities of returning are so high that, as Song warns, "it is difficult for customers to come back once lost."
Song’s list of "invisible costs" is both comprehensive and chilling. He cites the collapse of trust assets, permanent market loss due to switching costs, missed opportunities in the intensifying AI semiconductor race, the departure of core talent, and the worsening of the so-called "Korea discount"—a term referring to the undervaluation of Korean companies due to perceived risks. He warns, "In a situation where the competition for AI semiconductor hegemony is intensifying, consuming internal resources on conflict itself is a major loss."
The ripple effects don’t stop at Samsung’s front gate. The company is at the center of a vast ecosystem, connected to more than 1,700 partner companies supplying materials, parts, and equipment. Each production line at the Pyeongtaek campus supports about 30,000 jobs, according to Yonhap News. A halt in operations could trigger a domino effect, threatening not only suppliers but also local economies and employment. It’s a scenario that, as Song and other experts caution, could undermine the very fabric of South Korea’s industrial base.
International competitors are watching the situation closely—and some are already positioning themselves to benefit. Taiwanese media have reported that if Samsung’s production is disrupted, companies like TSMC could see their bargaining power surge, gaining an edge in global price negotiations. It’s not just a matter of lost sales for Samsung; it’s about a potential shift in the balance of power within the global semiconductor industry.
What’s driving the conflict? At its core, Song says, is a lack of transparency and information symmetry regarding performance bonus criteria. The union is demanding that 15% of Samsung’s estimated 305 trillion KRW operating profit for 2026—about 45 trillion KRW—be paid out as performance bonuses, and that any cap on such payments be abolished. Song likens the situation to a "Hicks paradox," where both sides, acting with incomplete or distorted information, end up in a stalemate that serves neither party well. "Negotiations can become irrational as companies conservatively present their payment capacity, and unions exaggerate the effects of a strike," he explained.
The union, meanwhile, has announced plans for an 18-day total strike starting May 21, and has held rallies not only at company sites but also in front of Chairman Lee Jae-yong’s residence—an escalation that has drawn criticism for extending the dispute into private spaces.
Song’s proposed solutions are as detailed as his diagnosis. He advocates for transparent and objective performance pay standards, using metrics like ROIC (Return on Invested Capital), TSR (Total Shareholder Return), and EVA (Economic Value Added). He calls for tiered profit sharing, caps and clawbacks, external verification, and—crucially—mandatory cooling-off periods and mediation before any strike action. "Both labor and management need to build a structure of transparent information sharing and rational cooperation before the costs of conflict undermine market resilience," he told Yonhap News.
Other industry analysts share Song’s sense of alarm. KB Securities, as reported by JoongAng Ilbo, estimates that a strike could reduce global DRAM supply by 3-4% and NAND by 2-3%, potentially driving up memory prices worldwide. With semiconductors accounting for roughly 35% of South Korea’s exports, the fallout could extend to capital markets as well. If foreign investors begin to perceive the Korean market as unstable, the result could be a decline in investment and higher capital costs for Korean firms across the board.
In the end, Song’s message is clear: while the right to strike is constitutionally protected, both sides must reckon with the full spectrum of potential costs—especially those that are hardest to see. As he put it, "The Samsung Electronics strike problem is a problem of the Korean semiconductor system. Before the cost of conflict undermines market resilience, both labor and management must establish a structure of transparent information sharing and rational cooperation."
With the clock ticking toward the planned strike, the decisions made in the coming weeks may well determine not only Samsung’s fortunes, but the trajectory of South Korea’s most vital industry for years to come.