Samsung workers could be about to strike, potentially making GPUs, memory, and SSDs even more expensive

Over 43,000 workers on Samsung's chip production facilities could be walking out for 18 days, if threatened strikes go ahead this week.

As if the chip supply situation wasn't bad enough already, there could be a new twist in the tale, as Samsung - one of the world's largest memory and NAND manufacturers - could soon be facing factory shutdowns, reducing global production capacity and driving up prices. A threatened strike involving over 43,000 workers in Korea would see over half the company's semiconductor production workforce taken out of action, in turn dropping global production of memory and NAND by 3-4%.

While that may not sound like a lot, the current pressure on chip manufacturing from the boom in demand for AI is already sky high and has caused RAM prices to quadruple and SSD prices to double. As such, even a slight drop in Samsung's production could send prices for the best gaming RAM in the wrong direction again.

So dire is the situation that, as of Monday, May 18, the Korean government has stepped in to tell the union organising the strike that its actions must not reduce production capacity and that staffing levels must be sufficient to "ensure safety protection, facility damage prevention, and product quality maintenance." In effect, this puts a stop to the action for now, but the threat of walkouts still remains.

As for why Samsung workers are striking, it largely comes down to pay. Because the AI boom has seen profitability of chip producers like Samsung soar, the workers' union is looking to get a cap on bonuses removed, paving the way for workers to receive a greater share of the company's profit, which currently stands at 53.7 trillion won (approximately $40 billion) for the last quarter.

The government's intervention acknowledges just how influential Samsung is to the country, with it saying that, while workers deserve fair compensation, "the rights of companies and shareholders must also be considered." The union, meanwhile, has estimated that a fully fledged strike could cost Samsung up to 30 trillion Won ($20 billion).

As well as memory and NAND (the storage chips used in SSDs) production, Samsung has also been earmarked to produce the GPU for the relaunched Nvidia RTX 3060, but it's unclear if this would be affected by the strikes.

Currently, the strikes are still due to commence on May 21 and last for 18 days, but negotiations between the government, union, and Samsung are still ongoing.