The semiconductor workforce, which is estimated at more than two million direct semiconductor employees worldwide in 2021, will need to grow by more than one million additional skilled workers by 2030, according to Deloitte’s 2023 semiconductor industry outlook. That means adding roughly more than 100,000 workers annually, the report said.
At the same time, while the industry has seen shortages in some roles, there have been layoffs in others. The talent problem is acute in Asia, where four countries in East Asia — China, Taiwan, South Korea and Japan — produce roughly 80% of all chips.
“Each country faces a unique set of challenges to grow their talent pool even as they’re trying to establish their own domestic chip production capabilities,” Deloitte said.
Addressing and balancing the semiconductor talent equation is a key area Deloitte recommended the semiconductor industry take in 2023.
SEE: Despite predicted growth, semiconductor industry requires transformation in 2023 (TechRepublic)
This sentiment is echoed in a 2022 Accenture report, which noted that if the U.S. chooses to focus on meeting even domestic demand for just critical semiconductor applications — such as automotive, home appliances, aerospace and defense — the country would need between 18 and 20 additional fabrication facilities staffed by 70,000 to 90,000 highly skilled personnel.
Additional talent is needed to decentralize the semiconductor industry
A less concentrated chip industry, both in manufacturing and assembly and testing, could help the U.S. and European industries that rely on chips, the Deloitte report observed.
“An industry that operates in more locations will need more talent, and more dispersed talent, to make trillions of dollars’ worth of chips,” it said.
This year, Deloitte suggests that chip companies consider expediting hiring diverse skills for both building and automating their manufacturing facilities and designing chips and tools.
“Their talent challenges are compounded by the urgent need to build large-scale fab facilities in multiple regions,” the report said. “Therefore, they need to accelerate hiring for a range of skills: Electricians, pipefitters and welders; technical engineers, maintenance personnel and smart factory automation specialists; and graduate electrical engineers to design chips and the tools and manufacturing processes that make the chips.”
Chipmakers in Europe and the Americas are similarly expected to need a mix of specialized workforce personnel to build back-end assembly and testing facilities, given the push to overhaul supply chains.
“These job groups have distinct training and educational needs, and skills within these job groups are evolving due to automation, digitization and semiconductor technology advancements,” Deloitte said. “The chip industry thus likely needs to partner with universities and engineering schools; work more closely with local tech schools, vocational schools and community colleges; and support national institutions specialized in STEM fields.”
Semiconductor industry’s competitive job market
Compounding the talent shortage is the allure of job opportunities within big tech companies, automotive companies, consumer electronics manufacturers and professional services firms, which are all attracting qualified semiconductor talent with competitive compensation packages and promises to change the world, the Accenture report pointed out.
“Semiconductor companies, with less defined brand equity and fewer market-competitive perks, continue to struggle in building the diverse, premier workforces needed to meet near-term demand and pioneer the next frontier of innovation,” Accenture said.
Companies are taking unusual steps in the race to add jobs and connect with rising generations. Intel, for example, has aired Sunday Night Football ads to lure new technical talent and has announced $2.4 billion in cash and stock incentives to retain key personnel, according to the Accenture report.
“By and large, semiconductor companies are losing the talent war — severely impeding meeting domestic demand for just critical semiconductor applications,” the report said.
Even with a concentrated focus on investing in science, technology, engineering and math education, “the talent pipeline remains narrow,” Accenture noted.
How AI and automation might ease the talent shortage problem
The Deloitte report pointed out some good news: New advances in AI tools for chip design, especially the physical layout, are allowing companies to produce better chips faster and use fewer people, which allows scarce talent to concentrate on the most pressing issues.
The Accenture report, meanwhile, had less optimistic news to offer, though there is a solution.
“Many semiconductor powerhouses lag other technology players in implementing core automation solutions, limiting their ability to free up employees to focus on higher value-add activities,” Accenture said. “This, coupled with rising costs to source, hire, onboard and retain semiconductor talent amid an increasingly competitive cross-sector talent war makes automation an appealing mechanism to help semiconductor companies re-envision their workforce.”
Embedded appropriately, automation should alleviate demand for hard-to-reach engineering talent.
“This must be done in parallel to increasing the supply of skilled resources to better position the semiconductor industry to meet the urgent need for qualified STEM professionals,” Accenture said.
How to develop and retain diverse talent pools
Besides skill development, the Deloitte report noted the chip industry may need to join forces with various local governments to enhance the exchangeability and mobility of skills between regions, secure support in the form of favorable talent immigration policies and seek assistance for local recruitment and skills-based training.
As a result of years of mergers and acquisitions and consolidation, many semiconductor companies may need to find a better way to integrate the various talent workforces, the report says. From an organization’s standpoint, chip companies should aim to develop strong and diverse talent pools across their ranks.
To achieve this, semiconductor companies need to continue to adopt a diversity, equity and inclusion mindset. Companies should recruit women and other underrepresented demographic categories in both their technical and leadership areas.
“They likely need to figure out ways to retain talent and show long-term career growth pathways for professionals,” Deloitte said. “Going forward, the technical skills needed by the industry are becoming less purely hardware-focused (where the industry traditionally has been strong) and are increasingly more about software.”
This requires new talent recruitment and training approaches.
“Semiconductor companies can reap greater reward by reframing the solution from ‘reskilling’ to ‘skilling,’” Accenture said.
Semiconductor companies that steer their recruiting efforts more toward diverse and alternative skillsets “are likely to bring a needed edge to the STEM recruiting war,” the report continued.
Accenture also recommends that these companies train new graduates to fill open technician and process engineering roles and upskill them to fill demand, which is a strategy the report said “is both cost-effective and feasible in the near-term.”
The report also pointed out that even before high-potential STEM students reach their college campuses, “they have already developed strong perceptions of prestigious tech companies … above the highest ranked semiconductor leaders.”
These companies include software giants like Google, Apple and Microsoft, aerospace players like Lockheed, Boeing and NASA, and automotive leaders like Tesla, General Motors and Ford.
“This reaffirms how disadvantaged semiconductor companies are in brand equity, meaning standard university recruiting tactics will continue to fail to draw highly valued STEM talent,” the report observed. “To deploy a one-size-fits-all recruiting approach is to vastly underestimate the complexity of the STEM talent war.”
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