Chinese semiconductor companies are aggressively absorbing key talent from South Korea and Taiwan to overcome the wall of U.S. export controls on advanced equipment. Through a so-called “talent black hole” strategy, they are going all out to secure experienced engineers with extraordinary conditions, including compensation packages up to three times the salaries offered by Samsung Electronics or SK Hynix.

According to industry sources and major media outlets including The Korea Economic Daily on the 5th, China is accelerating a strategy to overcome yield limitations in High Bandwidth Memory (HBM)—considered the core of AI semiconductors—and advanced DRAM through human capital. This goes beyond simple recruitment competition; talent acquisition has become a national mission for achieving semiconductor supply chain independence.

“The semiconductor industry relies on talent who have accumulated years, sometimes decades, of experience in equipment configuration, yield stabilization, and packaging know-how,” an industry insider said. “There is a strong recognition that no matter how much capital is poured in, closing the final gap in advanced semiconductors ultimately requires exceptional talent.” From China’s perspective, a single seasoned engineer holds greater strategic value than a piece of advanced equipment.

Chinese DRAM manufacturer ChangXin Memory Technologies (CXMT) is at the forefront of this strategy. CXMT has reportedly built a cutting-edge pilot line for next-generation “bonding DRAM” research and development and deployed a significant number of top-tier engineers. The company recorded an 8% share of the global DRAM market in the first quarter of this year and is growing rapidly. It is also pursuing a listing on the Shanghai Stock Exchange as early as the end of this month to secure large-scale investment funds.

Semiconductor Manufacturing International Corp. (SMIC), China’s largest foundry, was investigated by Taiwan’s Ministry of Justice for allegedly establishing a subsidiary in Taiwan disguised as a foreign investment firm to poach local engineers. Huawei, a flagship Chinese technology company, is also offering significantly higher salaries than competitors to recruit Taiwanese semiconductor talent, including former TSMC employees. A Huawei representative stated, “High salaries signify how much we respect and value talent,” adding, “There is an implicit rule to unconditionally offer and pay higher salaries than competitors.”

The methods Chinese companies use to secure talent are becoming increasingly sophisticated. There are frequent cases of indirectly establishing shell companies or small industry-academia research institutes overseas—entities that are difficult to trace—to approach global talent without direct involvement. Some offer high salaries reaching ten times the average monthly wage of a Chinese worker and three times a Samsung Electronics monthly salary. However, recruits are reportedly deployed into intensive R&D environments with near seven-day work weeks under tightly secured, closed conditions.

This Chinese offensive is already yielding results, rapidly narrowing the technology gap. Experts estimate the memory technology gap between South Korea and China has shrunk to around three years. CXMT is converting 20% of its production lines exclusively for HBM and is betting heavily on developing HBM3 and HBM3E. Its quality competitiveness has been recognized to the extent that it is being mentioned as a candidate for a new DRAM supplier for Apple, a company notoriously stringent about component supplier selection.

Warning signs are already flashing in the NAND flash sector. China’s Yangtze Memory Technologies Co. (YMTC) has successfully commercialized its proprietary “Xtacking” technology as a world first, achieving mass production from 160-layer to the latest 270-layer products. YMTC holds 119 key patents related to hybrid bonding, significantly ahead of Samsung Electronics (83) and SK Hynix (11). Samsung Electronics has even entered into a patent licensing agreement with YMTC for the development of its next-generation V10 (430-layer) NAND.

China’s pursuit is also fierce in the next-generation technology race dubbed “post-HBM.” CXMT has built a bonding DRAM pilot line in Hefei, Anhui Province, and is currently testing. This technology enables the manufacture of ultra-high-density DRAM using only Deep Ultraviolet (DUV) equipment, without the need for ASML’s Extreme Ultraviolet (EUV) lithography machines from the Netherlands. Some assessments suggest CXMT’s bonding DRAM may even hold an advantage over South Korea in terms of technology and speed.

The fact that most leaders of China’s semiconductor industry are elites who studied abroad is another factor accelerating the talent acquisition strategy. CXMT founder Zhu Yiming earned a master’s degree from the State University of New York and built his career in Silicon Valley. SMIC founder Zhang Rujing and AMEC founder Yin Zhiyao—who leads China’s largest semiconductor etching equipment company—also earned doctoral degrees in the U.S. and built core careers at global companies like Intel, Texas Instruments, and Applied Materials.

“Because the people who best understand the workings of global companies are positioned at the forefront of management, they accurately grasp what compensation systems and research environments motivate key personnel,” an industry insider analyzed. “Chinese capital and headhunters are continuously shaking the tree for senior engineers with five to ten years of experience who serve as the backbone of technology,” the source added. “While U.S. sanctions against China are erecting physical barriers, it is difficult to completely block the movement of talent who possess know-how and understand process optimization methods.”

Lee Byung-hoon, a professor in the Department of Electrical Engineering and Semiconductor Engineering at POSTECH, emphasized, “South Korea’s ability to maintain an advantage in the global supply chain is largely due to the intense U.S. semiconductor sanctions against China.” He stressed, “Before the golden time provided by U.S. sanctions runs out, South Korea’s semiconductor industry must secure an irreplaceable, super-gap technological edge in the next-generation memory and packaging markets.”

Choi Woo-young, a professor in the Department of Electrical and Computer Engineering at Seoul National University, warned about the pace of China’s HBM development: “If domestic AI chip developers like Huawei begin adopting these chips for the domestic market first and accumulating real-world experience, yields and stability could get on track much faster than expected.” Hwang Cheol-seong, a distinguished professor in the Department of Materials Science and Engineering at Seoul National University, also forecasted, “China’s semiconductor industry will become the greatest threat to South Korea’s future.”