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Semiconductors: The backbone to the connected world, the future is bright

The engine of the technology industry is people. Nowhere is this truer than in the semiconductor industry. Think about it. This industry does not depend directly on harvesting natural resources. It does not require that facilities be located near transportation hubs such as shipping ports. In the semiconductor industry, the key to success is initially human resources and intellectual prowess.

With more than 26 billion connected devices in use worldwide and with the number expected to triple by 2025, emerging technologies continue to increase the demand for semiconductor and microelectronic jobs.

Compounding the recruitment challenges for the semiconductor industry is the evolution of both “new technology” in high-tech segments and companies such as Apple, Amazon and Google, who have been market-stimulating consumers of the most advanced ICs, and are now shifting their business strategies to become more vertically integrated. Not only does this mean that they are morphing from merchant IC customers into captive semiconductor developers, but they also have become rivals of traditional semiconductor device manufacturers for IC design, semiconductor process engineering, and packaging talent. The competition for technically skilled professionals is increasing while the available supply of semiconductor talent dwindles worldwide.

We ask Adam Walker, Redline’s Director, what are the emerging technologies increasing demand for semiconductor job roles?

5G will mark a new dawn

As the key component of the connected world, wireless communications will continue to be a significant revenue driver for semiconductor companies. Emerging technologies in this segment are crucial to the industry outlook. For example, the ongoing rollout of 5G networks, IoT, smart city, and autonomous vehicle applications. The next generation of wireless technology, 5G offers exponentially faster speeds and more reliable connections on mobile devices. Today's technology leaders see 5G as a transformational technology that will drive the transition from a smartphone-based wireless world to an IoT world where an enormous array and number of devices are connected. Poised to change the face of wireless communications by enabling the hyper-connectivity between people and things, the development of 5G is well underway.

AI spurs chip innovation

If IoT and 5G will enable the connected world, then AI will make sense of it. People already use AI software every day – when a smartphone assistant helps with daily tasks, an online shopping site suggests a product, an email system filters spam or a social media site tags a photo. Organisations in nearly every industry are embedding data-driven technology across the enterprise to automate, accelerate, and enhance business processes and decision making.

As artificial intelligence continues its transformational impact on the world, the opportunity for semiconductor manufacturers is enormous. AI could allow semiconductor companies to capture 40 to 50 percent of the total value from the technology stack, representing the best opportunity they’ve had in decades. According to research by McKinsey, AI-related semiconductors will see a growth of about 18 percent annually over the next few years—five times greater than the rate for semiconductors used in non-AI applications. By 2025, AI-related semiconductors could account for almost 20 percent of all demand, which would translate into about $67 billion in revenue.

This growth in Artificial intelligence has sparked a chips arms race between the likes of Amazon and Google that is set to transform everything from smart homes to cloud computing.

The two companies are increasing investments in technology – an area that has largely been the preserve of incumbents like Intel, NVidia and Qualcomm.

The newest waves of AI technology – cognitive computing and machine learning – must process and analyse vast amounts of unstructured data, requiring tremendous processing power. Only cutting-edge chips with smaller node sizes can provide the kind of high-performance computing the next generation of AI technology will require.

“It is all about rapid adoption,” says Adam. “Companies who end up as the market leaders tend to stay there. This is a race between the likes of Amazon, Google, Apple, Facebook and Alibaba, etc as they all increase investment in semiconductor technology that is starting to disrupt the traditional buyer-supplier relationship .”

R&D is the top strategic priority

The explosion of emerging technologies spurs chipmakers to develop new and improved products and solutions. Challenging market conditions push them to diversify into new business areas. Established tech giants and platform companies that develop in-house semiconductor design centres threaten semiconductor businesses unless they raise their game. The spotlight is on innovation in the semiconductor industry. Access to promising IP is often becoming the basis of competition. With R&D costs increasing, semiconductor companies are seeking to recover investment costs and raise the return on innovation by increasing speed to market and scaling R&D into adjacent markets.

War for talent threatens growth

As semiconductor leaders see growth opportunities, their biggest concern lies in how to operationalise their growth strategies. 22% of survey respondents from KPMG’s Semiconductor report 2019 cited operational risk as the top threat to their organisation's growth. The question facing the semiconductor industry is no longer "Where do the opportunities lie?" The question is: "How do they align their resources and operations to achieve growth opportunities in emerging areas?"

Of course, professional talent directly impacts organisations with 64% of respondents naming talent risk as one of the top three threats to their organisations’ growth. The loss of an electronics engineer can stall a project making talent risk the most common issue.

Growing businesses, especially those aspiring to be hubs of innovation, need the best design and development engineers. Business leaders with novel ideas and a strategic vision, working with employees with unique skills to execute new projects, are often what set high-potential start-ups apart from the rest.

The semiconductor industry is no exception. The talent competition for semiconductor jobs is fierce. Companies are trying to grow their teams, but there is a finite amount of available talent in the current market. There are more technical and engineering jobs available than people to do them, whilst importing talent remains difficult.

The heavy focus on R&D almost certainly contributes to the view of talent risk. There are only so many innovators with the requisite skills sets to design and deploy newer technologies, and numerous employers want them.

With the industry-wide shift to a more service-oriented business model also contributing to the perspective on talent risk. Recognising that components can be commoditised, many semiconductor businesses are investing in software and related services to build more holistic, platform-based solutions that meet a broader range of customer needs.

The rapid pace of innovation that characterises the semiconductor industry is fuelled by the influx of new ideas and new participants. But this sector and the overall technology economy is facing a skills deficit that requires us to promote the industry to potential new hires.

To enable this vision, IC designers and software engineers are the real prize. According to SEMI, there are more than 10,000 engineer job openings in the global semiconductor industry. The Global Semiconductor Capital Equipment Market report also found a lack of qualified engineering and technology talent in the semiconductor industry.

The future is exciting, and we’re looking forward to seeing how the latest technology will affect the role of people and the products that they sell. With so much change happening in the semiconductor and electronics industry, now is the perfect time to take the next step in your career.

Speak to Redline today or contact Adam Walker on 01582 450054 or


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