That seems unlikely. In fact kernel builds don't really produce much memory pressure, no more than a 1-200 MB per parallel make process in general. (The final link takes more, but that doesn't really parallelize anyway).

I don't know about kernel builds, but memory pressure is the usual limiting factor when building for macOS/iOS builds when you step up parallelization like this.

Another possibility is system bugs that can be exposed when it thermal limits because it will stop running background QoS tasks, and things waiting on them will hang. It's pretty hard to stress it to that level.

I have done both these things by building compilers on M1. The memory pressure wasn't always from the host compiler but rather tools like dsymutil that may not be perfectly optimized themselves.

Limiting factor for being able to use the machine that is, not for compile time.

Apple seem to have actively chosen to skimp on memory capacity, so this seems very much like something that's on them.

I would say it's unreasonable to expect 'make -j8' to perform well on a low-end laptop (M1 is a low end CPU) and that the system should be picking the -j number for you.