SAN JOSE/TAIPEI/NANJING -- Tucked away in a building in the heart of Silicon Valley is Chinese tech conglomerate Tsinghua Unigroup's R&D lab, where some 50 engineers are working toward a single goal: to develop memory chips that are as competitive as those of Samsung Electronics.
The facility in San Jose, California, is within walking distance of Samsung's U.S. headquarters, as well as those of Cisco and other tech giants.
"Most of the people here, including me, came from the world's leading memory chipmakers -- not only from U.S. companies but also from Asian multinational companies' American head offices," a person who works at the lab told the Nikkei Asian Review. His salary, he added, is higher than it was at his previous job.
On the other side of the world, Taiwanese memory chipmaker Nanya Technology -- like its bigger rivals Samsung, SK Hynix and Micron Technology -- is also under pressure from Chinese competitors poaching its best workers. The company launched a special bonus program last year to retain 500 of its best employees after losing some 50 engineers to emerging Chinese players.
"We continue to feel the pressure," Nanya Tech President Lee Pei-ing said. "To be honest, it's difficult for us to retain all of them as it's unlikely for us to totally match the salary package these Chinese rivals would offer." According to people familiar with the matter, Chinese recruiters can offer pay packages that are three to five times higher than what chip specialists earn in Taiwan.
The escalating race to secure the world's top chip engineers underscores China's determination to reshape the global semiconductor industry.
Tsinghua Unigroup affiliate Yangtze Memory Technologies was formally established in 2016 to eventually serve as a replacement for Samsung and Toshiba and now employs around 3,000 people. Innotron Memory, another memory chip project that is supported by the government, currently has around 1,500 employees. Though many of these are local college graduates, most of the team managers are from South Korea, Taiwan or the U.S. and have experience at Samsung, SK Hynix, Micron, Intel or Western Digital.
Each of these projects needs at least 10,000 engineers in the near future if they are to attain their originally planned scales -- and these are just two of many state-sponsored companies eager to recruit as many skilled workers as possible, said a chip supply chain executive familiar with the matter.
Tsinghua Unigroup Chairman Zhao Weiguo said he is fully aware that building a successful chip company requires more than pouring huge sums of money into building factories.
"One of our key strategies is to hire employees who are capable of leading projects and give them a big stage and opportunities that they could not find anywhere else," Zhao said at the IC Market China 2018 forum hosted by the China Semiconductor Industry Association in Nanjing on April 12.
The group hired Charles Kau, former president of Nanya Technology, to help build the team in 2015. It recruited former Chief Operating Officer Simon Yang of Semiconductor Manufacturing International Corp., China's top contract chipmaker, and David Duffin, a former executive at SanDisk, in 2016.
Tsinghua Unigroup's hunt for talent is just one example of China's enormous appetite for chip brainpower. Bob Yu, vice president of SMIC, told Nikkei that the biggest challenge his country faces in trying to quickly boost its chip industry is "a serious shortage of experienced talent."
According to a white paper published last year by CSIP, a division of China's industry and information technology ministry, the country needs some 700,000 chip specialists to meet its goal of expanding the industry's revenue fivefold by 2030. It currently has less than 300,000 such professionals.
The report further said that salaries for senior managerial positions in semiconductor-related R&D average 1.36 million yuan ($216,000) in China, which is already competitive with South Korea, Taiwan and even Silicon Valley.
"China has really become a huge magnet and an attractive destination for talent and investment," said Y.W. Sun, chief executive of China Fortune-Tech Capital, "as our semiconductor industry is growing at a speed that nowhere else can compete [with]."