Chip and electronics manufacturers can’t find enough skilled workers


In short: A scarcity of everything from raw materials to chips and other critical components is having a ripple effect on the electronics and automotive industries, but this is just the beginning. Suppliers in North America, Asia and Europe are now facing an even bigger challenge – the growing difficulty and cost of finding skilled workers to keep industrial equipment running at a time when demand is higher than it has been in recent years.

The ongoing shortage of microcircuits is placing a serious strain on the supply chains of many technology companies. However, there is an even bigger problem facing electronics manufacturers, some of which have stopped working. hiring to meet strong consumer demand in the holiday quarter. Nearly 80 percent of them now say it has become more difficult to find skilled workers for their factories.

The cost of finding skilled workers has skyrocketed over the past year, according to IPC, which represents chip makers, contract manufacturers such as Foxconn, and other vendors. This trend is expected to continue in 2022. This is an unfortunate moment, since the demand for everything that has a chip inside is higher than it has been in recent years.

Organization examined hundreds of suppliers from Asia, North America and Europe to gain a clearer understanding of the overall electronics value chain. It appears that two-thirds of American companies are having trouble finding skilled labor, as is the case with European suppliers. Meanwhile, only a third of Asian suppliers face this problem, primarily due to lower labor costs and looser safety regulations.


This is not an easy problem to address, but nearly half of the organizations surveyed said they are retraining existing employees and offering more attractive compensation for in-demand positions. However, new outbreaks of Covid-19 have led to travel restrictions, especially in Asia, making it difficult for companies to attract more factory workers and engineering talent.

Interestingly, 90 percent of all companies surveyed said that the cost of materials and components has increased significantly over the past year, which has significantly reduced profit margins. The wobble is in line with this month’s announcement that rare earth prices have risen sharply in the past twelve months, which could lead to an increase in retail prices for all electronics as early as next year.

Automakers are among the hardest hit customers of these suppliers. According to AlixPartners, the automotive industry is likely to lose a whopping $ 210 billion in revenue this year, nearly double the previous estimates released in May. Many automakers have had to cut production due to chip shortages, which are expected to result in the loss of 7.7 million vehicles from this year’s production target.

Credit to masthead: ASML

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