Record Profits, Yet Strike Looms: Revolt at Top Chipmaker TSMC

The global semiconductor market faces the threat of paralysis as workers at Taiwan Semiconductor Manufacturing Company (TSMC), the world's leading chip producer, reportedly consider striking. This situation echoes recent labor disputes at Samsung Electronics and highlights a growing pay crisis within the industry, even as companies report record profits fueled by the artificial intelligence boom.

At TSMC, tensions are escalating due to reports of planned cuts to performance bonuses. This news has caused significant frustration among employees, especially given the company's spectacular financial performance. In the first quarter, TSMC recorded a 58% year-on-year increase in net profit. Workers are reportedly incensed that management might reduce their bonuses while the company pursues an ambitious expansion plan, including the construction of 12 new production facilities. Rumors suggest these bonus funds could help finance this massive capital investment, a strategy employees fear will shift the burden of global expansion and technological competition onto their earnings.

TSMC holds a unique position not only in the global supply chain but also for Taiwan's economic and geopolitical security, often referred to as the island's "sacred mountain guarding the nation." The internal dispute over profit sharing has therefore generated considerable public attention. While the company has not officially confirmed plans to reduce bonuses, discussions are rife in employee groups and local media.

The specter of mass protests in Taiwan has gained momentum following events in South Korea. Just before a planned 18-day general strike on May 21, a settlement was reached at Samsung Electronics. Approximately 48,000 union members were involved in that dispute, which threatened to disrupt component supplies. Mediated by the government, an initial agreement was reached where about 10.5% of the chip division's operating profit will be paid to employees as stock bonuses over the next 10 years. Investor reactions to this truce were relieved, though stock market analysts have issued warnings.