[Editorial] Rising Semiconductor Profits Should Be Used for Future Investment to Sustain Growth

Net profits this year at Korean semiconductor companies, including Samsung Electronics, are expected to surge. Looking only at Samsung Electronics, which is in a dispute over performance bonuses, some analysts say its profit could exceed 300 trillion won this year and reach 500 trillion won in 2028. But as profits rise, so do the investment spending of global chipmakers. To win in global competition, companies must invest on a larger scale than their rivals.
Samsung Electronics disclosed earlier this year that it plans to invest 110 trillion won. It has also outlined a plan to invest 450 trillion won over the next five years. That figure could rise further as competition intensifies and the company expands factory construction in the United States and elsewhere. In other words, even when net profits are high, there are many places where that money must be spent.
For a company to grow steadily, it must use the profits earned through management activities to invest in the future and create a virtuous cycle that lifts sales and earnings. If it fails to generate profits, investment shrinks and the company can fall into a vicious cycle of declining sales and earnings. Most global companies that lead the world market operate within such a structure.
In particular, the investment scale of semiconductor companies is astronomical. In the case of Taiwan Semiconductor Manufacturing Company Limited (TSMC), it is moving ahead of competitors by aggressively expanding facility investment at overseas sites in the United States and Japan. Facility investment is not the only priority. A major trend among global chipmakers is to sharply increase research and development, or R&D, spending in the same way.
When corporate profits soar, it is only natural to raise employees' wages as well. If workers are rewarded well for their efforts, they will approach their jobs with greater enthusiasm and produce better products. However, if demands go too far, as in the bonus request from the Samsung Electronics union, it may ultimately affect investment spending.
The semiconductor industry, like the broader economy, goes through repeated booms and downturns, so companies should focus on investment during good times. That is because profits fall during downturns, making it difficult to secure the level of investment needed. Samsung Electronics may post strong profits for several years starting this year, but it must allocate as much of those earnings as possible to investment. Only then can Samsung Electronics continue to develop, and in the long run, that will also benefit employees.
The Samsung Electronics union should not focus only on immediate personal gains, but step back and look at the future of the company it belongs to. If it thinks of its own child working at Samsung in the future, the answer becomes simple. If one is willing to give up a little for the sake of a child's future, labor-management conflict can be resolved.
The union should avoid the mistake of seeing only the trees and missing the forest. It must do so not only for Samsung as a company, but also for the larger and higher concept of the nation. It is time to abandon the idea that as long as I am doing well, it does not matter what happens to the country or the company. I exist because the nation exists and because companies exist. Open your eyes wide and look far ahead. Think of the money you receive a little less as being used for future investment.