AI Chip Riches Are Making Parental Leave a Costly Choice in South Korea

(Photo=Samsung/SK hynix)

The artificial intelligence boom has delivered enormous profits to the semiconductor industry. At two of the companies benefiting most from that surge, the money is becoming large enough to complicate one of the most personal decisions employees make.

Parental leave rates fell at both Samsung Electronics and SK Hynix in the first half of this year for the first time on record, just as workers at the South Korean chipmakers began anticipating some of the largest performance bonuses in their companies’ histories. At Samsung’s semiconductor business, payouts have been projected at roughly $147,000 to more than $443,000 for some employees as profits soar.

The development matters beyond South Korea because Samsung Electronics, the country’s largest technology company and a major global semiconductor producer, and SK Hynix, one of the world’s largest memory chipmakers, occupy critical positions in the supply chain supporting the AI computing boom. Their experience shows another side of the industry’s extraordinary profitability. The same profits driving investment in chips and production capacity are creating financial incentives powerful enough to influence when highly skilled employees decide to step away from work.

That tension is especially striking because parental leave is supposed to allow employees to care for children without having to choose between their careers and their families. At the two chipmakers, however, employees who take leave can be excluded from performance bonus payments or receive reduced payouts because of shorter credited service periods, according to an industry official cited in the original Korean report.

When a performance bonus can reach hundreds of thousands of dollars, the cost of taking leave can therefore become unusually high.

Samsung Electronics reported that 35.5% of employees who had a child this year took parental leave during the first half, compared with 36.2% a year earlier. The rate among male employees fell to 11.2% from 12.4%, while the rate among women dropped more sharply to 88.2% from 94.3%.

SK Hynix recorded the same direction of travel. Among employees with children in elementary school or younger, the parental leave rate declined to 3.2% from 4.0%. The rate among men fell to 0.7% from 1.3%, while the rate among women dropped to 8.9% from 10.1%.

The two companies calculate their parental leave rates using different employee groups, meaning their headline percentages are not directly comparable. The more significant change is that both declined during the same period, something that had not happened previously in the publicly disclosed data.

The timing coincides with an extraordinary upswing in semiconductor earnings.

Samsung Electronics and SK Hynix have agreed to use 10% and 10.5% of operating profit, respectively, to fund performance bonuses without a separate ceiling on the total bonus pool. Samsung’s semiconductor earnings have improved rapidly since the second half of last year, with projections cited in the Korean report putting companywide operating profit above roughly $258 billion this year. Expectations for semiconductor employee bonuses have consequently risen as high as approximately $443,000.

SK Hynix offers another indication of how the semiconductor cycle and employee behavior have moved together. The company recorded nearly $6 billion in operating losses in 2023, when its parental leave rate climbed above 8%. As annual operating profit rebounded to roughly $17 billion in 2024 and about $34 billion in 2025, the leave rate moved back into the 6% range.

The shift exposes a complication that can accompany the AI investment boom. 

Semiconductor companies need lucrative compensation packages to reward employees and retain scarce technical talent as competition intensifies. But when a large share of compensation becomes tied to profits and time spent at work, benefits intended to help employees temporarily leave the workplace can lose some of their practical value.

At Samsung Electronics and SK Hynix, record chip profits are no longer affecting only earnings, investment budgets and employee paychecks. They are beginning to reshape the financial calculation workers make about whether they can afford to take time away to raise their children.

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Jin Lee

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