If the challenges faced by the semiconductor industry weren’t already complex, foundries in the US are now seeing a labour shortage in the field of semiconductor manufacturing. Why does the semiconductor industry continue to face challenges, what are manufacturers in the US resorting to, and what does this mean for the long term?

Why does the semiconductor industry continue to face challenges?

For the past two years, it seems that the semiconductor industry has been repeatedly hit with problems, and just as soon as one seems to be solved, another one introduces itself. The COVID pandemic saw a major disruption in the automotive industry, resulting in a near-zero demand for automotive semiconductors. This led to semiconductor companies shifting their focus to consumer devices. While this worked for a while, it led to a major automotive part shortage when automotive manufacturers restarted their operations.

Not having enough automotive parts, semiconductor manufacturers shifted their focus back to automotive parts, resulting in too much focus on automotive parts and consumer devices, then saw semiconductor shortages. As supplies began to normalise, rising costs of key resources and a downturn in the economy further hurt the semiconductor industry.

Just when the industry thought it was all over, China’s increasing threats to Taiwan have sent shockwaves through the industry, with many worried about a future invasion that would threaten worldwide supplies. Then when the world entered 2022, it was hoped that the end of COVID would see normality, but then Putin decided to launch a “special operation” to “liberate the Ukrainian people”. This has resulted in a rapid cost in oil, shortages of key supplies used by the semiconductor industry (such as Neon and Krypton), and increasing restrictions on what can and cannot be traded.

US semiconductor industry now facing a worker shortage

Just when you thought things couldn’t worsen, it has been reported that US manufacturers are struggling to find key workers with the skills needed to operate manufacturing equipment used in the semiconductor industry. Despite what many may think, the semiconductor manufacturing process is heavily reliant on employees operating equipment, and the latest equipment being used has rapidly become the norm.

The shortage of workers isn’t a result of fewer people working in the industry but a result of new technologies rapidly being integrated into modern production processes, and there are only so many people around the world who can operate such equipment. One area that has seen shortages, in particular, is EUV Lithography (designed by companies such as ASML), and this has only been used in the industry for the past few years.

As such, foundries in the US (who are currently investing billions into expanding sites) are resorting to training programs for existing and new employees and hiring those in South Korea and Taiwan who already have the expertise.

What does this challenge mean in the long run?

The need to bring semiconductor fabrication onto home turf is all fine and good with large sums of money to construct sites, but unless there are local workers who can do the job, then no amount of money will help. This skills shortage is not something that will be solved immediately, and even those who are trained in using modern equipment won’t have the experience garnered by those already in the industry.

However, this skill shortage could be a golden opportunity for those in the field or similar fields, as skill shortage often comes with large wages and benefits. Just as the HGV driver shortage in the UK saw pay rates multiply by as high as 300%, the same could be seen by semiconductor manufacturers desperate to get production brought back to home nations (US, UK, EU etc.).

Thus, if you work in the semiconductor industry and think you may be able to pick up the skills needed to operate EUV lithography equipment, now could be a golden time to do so and may even open up moving opportunities to other countries.