Studies show a growth in the semiconductor industry despite the chip shortage and supply chain concerns
FREMONT, CA: Despite chip shortages and supply chain concerns, according to a new Deloitte analysis, corporations will set historic revenue highs this year. Even though predictions show a slowdown in growth, the industry is likely to generate more than 600 billion dollars for the first time. Growth is expected to reach 10 percent in 2022, compared to 25 percent in 2021. In the coming year, four major developments are predicted to shape the sector.
To begin with, chips will be more significant than ever before, with growing semiconductor content in everything from cars to appliances to factories, in addition to the regular items like computers, data centres, and cellphones. Second, for the first half of 2022, shortages and supply chain concerns will be front and centre, with the second half potentially easing up. However, some components will have lengthier lead times, which could extend well into 2023.
Third, the sector is experiencing a skill deficit that will take time to fix. Increasing the number of domestic chip manufacturing plants in the United States, China, Singapore, Israel, and other nations will eventually result in a larger and more diverse pool of talent. Meanwhile, current employees will need to enhance and broaden their engineering and manufacturing skill sets. Finally, the semiconductor industry's digital transition will continue and accelerate.
Nearly three out of every five chip companies have started their digital transformation journey, but more than half of them are adjusting it on the go. In general, the industry will continue to grow strongly in 2022, even as it takes steps to address chip shortages, manages lead times with suppliers and end customers, builds manufacturing capacity locally or nearshore, hires specialised engineering and design talent, and strengthens supply networks with advanced digital solutions.