When South Korea’s most high-profile divorce case returned to courtroom final month, the legal professionals had been arguing not simply in regards to the breakdown of a relationship, but additionally the precise date at which to worth shares in a single particular firm.
The judges’ choice in Seoul may change the worth of enterprise tycoon Chey Tae-won’s belongings by billions of {dollars}. The shares had been within the holding firm behind SK Hynix, the producer of chips powering AI programs all over the world.
South Korea is likely one of the world’s biggest makers of these high-value chips and the nation is seeing an unprecedented wealth growth from their rise. From employees in tech corporations accumulating six-figure bonuses, to atypical individuals seeing huge funding returns – all of it driving a surge in luxurious spending.
However solely a small slice of the inhabitants is cashing in, sparking a wider debate about who ought to have a share within the earnings of the nation’s most precious business. As South Korea grapples with widening inequality, calls are rising for a number of the earnings – or the taxes they generate – to be unfold extra extensively.
The large wealth surge has been pushed by two firms – Samsung Electronics and SK Hynix. The pair dominate the worldwide provide of high-bandwidth reminiscence, the specialised chips that AI programs must run. Analysts challenge their mixed working earnings may rise nearly sevenfold this 12 months.
Their success has pushed South Korea’s main stock index – the Kospi – to report highs.
The chipmakers have begun sharing these report earnings with their workers on a scale the nation has by no means seen. At Samsung, a memory-chip employee on a base wage of 80m received ($51,300) could receive bonuses near 600m received ($384,900) this 12 months, most of it in inventory. That’s roughly 17 instances the typical annual wage at a small South Korean agency.
SK Hynix paid its employees a bonus of practically 3,000% of their month-to-month wage earlier this 12 months. Based mostly on forecast earnings, subsequent 12 months’s payout is projected to be a number of instances bigger.
The indicators of this flourishing wealth are dotted throughout the nation. In satellite tv for pc cities constructed across the chip factories south of Seoul luxurious gross sales are surging.
Within the first weeks of Might, jewelry gross sales at one division retailer jumped 146%, whereas watch gross sales rose 85%. In Icheon, the place SK Hynix has its most important campus, imported automotive registrations surged 108% in February. Residence costs close to semiconductor firm bus routes are rising at 4 instances the broader Seoul common.
Not everybody benefiting from the AI growth works in a chip manufacturing unit.
After watching monetary movies on-line just a few years in the past, Brian Lee, a retiree in Seoul purchased small quantities of SK Hynix and Samsung shares – after which forgot about them. His SK Hynix return is now 1,264%.
“That is the results of my laborious work, plus luck,” he says. “I really feel responsible, and on the similar time, though I’ve but to money it out, I are inclined to spend extra,” he stated, including he has began collector watches.
Who owns the earnings?
The explosion in wealth has pushed questions on who’s entitled to a share within the earnings – and how one can unfold the wealth extra evenly throughout society.
“Over time, the semiconductor business benefited enormously from authorities help,” says Kim Yong-jin, professor of enterprise administration at Sogang College in Seoul, pointing to many years of state funding in analysis and industrial coverage. “So that they have to consider society itself.”
The president’s chief coverage adviser was drawn into the argument in Might, floating what he known as a “citizen dividend”, arguing the wealth rested on foundations constructed by all Koreans over half a century.
Although some critics noticed it as a plan handy out money or seize firm earnings outright, he later framed it extra narrowly as a option to channel surplus tax revenues again to the general public via structured funding.
Opposition politicians known as his feedback akin to communism and the presidential workplace distanced itself from the plan.
The query of shared good points shouldn’t be solely political. Samsung’s largest union practically introduced manufacturing to a halt in Might, demanding a assured share of earnings, earlier than a last-minute deal averted a strike. However the deal upset some within the firm, as these within the telephone and equipment division had been set to obtain solely a fraction of what these working in chip making did.
South Korea has lengthy grappled with inequality. It has one of many highest charges of aged poverty within the developed world, whereas rising housing and dwelling prices have deepened strain on many households.
Extra Koreans really feel their dwelling requirements have worsened than improved, regardless of the wealth piling up elsewhere. Manufacturing employment has fallen 12 months on 12 months for practically two years. Almost one million small companies closed in 2025, with many homeowners left carrying big money owed. The earnings hole between the richest and poorest households hit a six-year excessive.
“Everyone seems to be speaking in regards to the growth, however most Koreans can’t really feel it,” says Kyusuk Cho, a graduate pupil in data research. “Life is getting costlier and jobs are more durable to seek out.”
Strip out the 2 chipmakers – who make up greater than 50% of the Kospi index – and the remainder of the financial system is barely shifting.
Kim Yong-jin says the good points must be shared between those that invested, those that labored, and the society that made it potential, in a means that strengthens the nation over the long term, however that South Korea has but to construct a framework for a way.
“We want a consensus on how one can share these earnings,” he says. “That’s a very powerful half.”