Economics
Chip Boom Masks Weakness in Korea’s Booming Economy
- Automation means relatively few share in export boom
- Economists warn of sector’s outsize role in GDP growth
Photographer: Tomohiro Ohsumi/Bloomberg
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The semiconductor industry’s role as a driver of South Korea’s economic expansion this year comes with caveats: the booming sector is creating few jobs while masking weakness in other areas of the economy.
Profits at companies like Samsung Electronics Co., the world’s biggest chipmaker, have soared as global demand sent Korea’s semiconductor exports shooting up by 56 percent this year through November. This has fueled capital spending, too, with Samsung announcing 20.4 trillion won ($19 billion) of new investments to expand output.