The world needs more skilled semiconductor workers
Semiconductors are increasingly in demand globally. With chips being key components in most new gadgets, devices, and vehicles today, keeping the semiconductor supply chain undisrupted is a prerogative for organizations around the world.
According to Deloitte’s 2022 semiconductor industry outlook, the global semiconductor chip industry is expected to reach US$600 billion in 2022. The report also states that chip shortage and supply chain issues will be apparent in the first half of the year and may stretch into 2023.
More importantly, Deloitte’s report highlights that the ongoing talent shortage will be made even more severe by the addition of increased semiconductor manufacturing facilities outside Taiwan, China, and South Korea. The higher demand for software skills required to program and integrate chips into fast-growing markets will further exacerbate the shortage.
In fact, chip manufacturers have announced huge investments in new chip production plants around the world. From Penang to Texas, the chip manufacturers include companies like Intel, TCMC, Bosch, Micron Technologies, and several others.
With most of these new plants are only scheduled to be fully operational in about two years, some tech companies have decided to design their own chips and manufacture them by themselves. Apple, Samsung, Oppo, Sony are some of the companies that have decided to do this and venture into the industry.
Fabs of the future
As chip companies announce new fabs and tech companies venturing into the production of microchips as well, the new manufacturing plants would most likely be built with the latest production technology.
This would mean the plants would be relying on emerging technologies like AI to ensure they can not only operate automatically but also with minimal human intervention. These modern fabs of the future would be state-of-the-art and able to produce chips at a much faster capacity than the current fabs around the world.
Automation will be key in ensuring production is not disrupted in the entire chip supply chain process, from producing, packaging and delivery. However, as Deloitte’s report highlights, there is still one big problem that may not be easily solved – the lack of skilled workers in the semiconductor industry.
Semiconductor skills shortage
While chip companies build new fabs, the concern most of them are having now is if they will have sufficient manpower to work in them. Sure enough, technology can automate most processes in a fab. But the reality is, the semiconductor industry still needs professional skilled workers to manage some roles.
These include engineers in scientists in the field to ensure the industry is kept going. However, statistics from around the world are showing otherwise. There is now a big gap in filling up the semiconductor roles in the industry and the fear is that the problem with only get bigger in the future.
According to a whitepaper by Eightfold.ai, the US alone will need around 70,000 to 90,000 workers to be added by 2025 to meet the most critical workforce needs for the new fab facilities. The research reveals that many existing semiconductor manufacturing roles and skills are rapidly losing prevalence in the modern workforce. What’s more, to meet the capacity needs to be brought about by new fabs for critical semiconductor applications, the US for example needs to increase its current workforce by a minimum of 50% — and likely significantly more.
The WallStreet Journal reports that the average monthly shortfall in semiconductor workers was about 27,000, a 44% increase from the previous year. Taiwan, which is a global powerhouse in chip making, the requirement gap is at its highest level. The lack of highly skilled engineers may derail Taiwan’s efforts to stay at the forefront of advanced technology. There are also concerns about China’s dominance in the semiconductor parts sector.
However, even China is facing a shortage of semiconductor workers. SCMP reported that China is facing a chronic shortage of scientific and engineering talents which is hampering its efforts to become a semiconductor superpower. China wants to reduce its reliance on imported chips but the shortage of experts is not looking good for the world’s second-largest economy.
A study from Peking University showed that the shortfall doubled in 2019 to about 300,000 from 150,000 in 2015. Around 512,000 people were working in China’s semiconductor industry at the end of 2019, compared with projected demand for a workforce of 745,000 by 2022, according to a recent white paper from the China Centre for Information Industry Development.
Solving the problem
The study by Eightfold.ai also uncovered several areas in the semiconductor industry where employers would need to be skilled or reskilled. The figure above not only shows the number of jobs in the industry that is being increasingly made redundant by technology but also roles that need personnel to have additional upskilling.
One of the biggest shortages in the industry is also the lack of scientists in the field. In China, the demand for scientists continues to see an increase. The average salary in China’s semiconductor industry has also increased by 9% in 2021, amidst the ongoing China-US tech rivalry.
To address this shortfall, China’s Peking University has set up a semiconductor school to train chip engineers and technicians. Other universities being part of Beijing’s drive to boost semiconductor self-sufficiency include Tsinghua University, which created a semiconductor college in April 2021, leveraging its strengths in science and engineering as well as Shenzhen Technology University (STU). STU has set up a school focused on integrated circuits in cooperation with Semiconductor Manufacturing International Corporation (SMIC), China’s largest and most advanced chip foundry.
In Taiwan, a law was passed to promote innovation and education in high-tech sectors such as semiconductors, leading several Taiwanese universities to start specialized semiconductor colleges in partnership with companies including TSMC. Over in Malaysia, Micron Technologies will be working with a local university to develop more skills in semiconductors as well as to conduct research and development in the field.
Other programs include the SEMI Foundation, a non-profit, public benefit arm of SEMI, the broadest tech-focused, not-for-profit, global industry association in the world. It represents the electronics manufacturing and design supply chain, connecting over 2,400 member companies and 1.3 million professionals worldwide. The SEMI Foundation supports workforce development in the semiconductor industry. Their charge is to dramatically expand the pipeline of talented workers ready to fill the significant workforce deficits reported by companies worldwide.
With governments, chip companies, and tech companies working with higher learning institutes and universities to upskill, reskill and produce more talent in the semiconductor space, the only question now is, will they be able to attract fresh talent to join the industry?
The semiconductor industry generally offers a generous salary package for skilled workers. Perhaps all they need to do now is to find ways to attract more into the field and also keep their existing employees satisfied with their work.
As much as technology can automate processes and make workloads easier, closing the gap in the semiconductor industry can happen, but it is going to take time to get there.