Fueled by record-high investment from semiconductor players and once-in-a-generation federal backing, semiconductor manufacturing capacity is poised for a massive expansion in the United States. This strategy aims to rebalance the country’s supply and demand profile to establish greater autonomy in semiconductor manufacturing, design, and intellectual property rights; as the US secretary of commerce has stated, one of the goals is to propel the United States to produce 20 percent of the world’s leading-edge logic chips by 2030. All of this investment is expected to create up to 48,000 jobs at fabrication plants (fabs), some of which are slated to begin operating in the next two to three years. These new job numbers do not account for the rise in attrition the industry is likely to experience in the same time frame.
On the talent front, semiconductor players face an uphill battle. Already contending with considerable attrition and recruitment challenges, companies must compete with other industries for a shrinking population of skilled workers to build and operate their new US facilities. The talent needed to meet the surge in demand spans three distinct labor pools—construction craft laborers, engineers, and technicians. Each of these pools has its own pipeline and specialized skill set. Despite industry groups’ efforts to raise awareness and boost recruitment, the supply remains inadequate. Targeted strategies customized to each pipeline are essential—staffing shortages could put domestic objectives for the industry at risk, drive up labor costs, and delay or diminish the return on this monumental investment.
Finding the talent and skill sets needed to support this high-stakes endeavor is a daunting challenge. Meeting the demand for semiconductor talent will likely require multiple public and private collaborations in addition to workforce development initiatives already planned or under way. This article examines some of those efforts, the nature of the jobs being created, and the labor pools targeted to fill them.
The massive scope of semiconductor investment and the industry’s existing talent challenges
In addition to the nearly $53 billion earmarked by the federal government for investment in domestic semiconductor research, development, and production through the CHIPS and Science Act of 2022, semiconductor companies have announced more than $200 billion in US fab investment through 2032. Announced investments are spread across the country, with new builds or fab expansions planned in 16 states. For example, McKinsey analysis of company data shows that approximately 10,000 new job openings will be created through expanded operations in New York, and four new fab builds in Arizona will create around 7,500 jobs (Exhibit 1).
The scale-up in US fab operations coincides, inopportunely, with a marked slump in talent recruitment and retention in the semiconductor industry. McKinsey has written previously about the talent headwinds facing the semiconductor industry, including an aging workforce, changing skill bases, and new members of the workforce opting to pursue roles in digital and analytics rather than manufacturing. In 2022, job postings for semiconductor engineers and technicians totaled 25,000—twice the number posted in 2021 and three times the number posted in 2020 (Exhibit 2).
The CAGR for semiconductor job postings between 2017 and 2022 was approximately six times the CAGR between 2010 and 2017. Additionally, semiconductor job postings were open for about a week longer in the 2018–22 period than they were in the 2010–17 period. And in 2022, the active status of technician job postings rose to 28 days—the peak level reached prior to the start of the COVID-19 pandemic. At the same time, attrition has been exceptionally high, and McKinsey analysis indicates it could rise even higher. In 2023, 53 percent of electronics and semiconductor employees indicated they were at least somewhat likely to leave their current jobs within the next three to six months, up from 40 percent in 2021 (Exhibit 3).
Amid these circumstances, semiconductor companies must find ways to source additional new talent to staff their expanding US operations.
The specialized talent and resources required to build and operate fabs
Fabs have unique environments and requirements. For example, semiconductor clean rooms are enclosed environments with uniquely stringent temperature, airflow, light, noise, and vibration requirements. Construction craft laborers, engineers, and technicians working in fabs must be proficient in maintaining the conditions necessary to adhere to standards for safety and quality assurance.
What goes into building a new semiconductor fabrication plant? As a starting point, it takes two to three years of construction, a year or more for equipment installation and ramp-up, and more than $20 billion for some leading-edge facilities. And each phase involved in getting a fab up and running requires different types of talent in varying numbers. Construction craft laborers are essential to the building phase, while engineers and technicians are required to design and set up equipment and process lines during the final phases of construction. Once operations are under way, engineers and technicians are needed to fill roles in several areas: manufacturing, integration and yield, central labs, facilities, quality assurance, product management, industrial engineering, and more. A leading-edge fab with a capacity of 20,000 to 45,000 wafers per month, for example, would employ between 1,100 and 1,350 engineers and about 950 to 1,200 technicians.
The semiconductor industry’s talent needs fall into three crucial categories:
Construction craft
Construction craft laborers include welders, electricians, carpenters, masons, and other skilled tradespeople. They have typically attended trade schools, completed apprenticeships, or learned their trade on the job. As McKinsey has written previously, legislation earmarking $550 billion for public infrastructure has created a boom in both commercial and residential building across the country. Amid this boom, pipe fitters, carpenters, and other tradespeople with specialized skills (such as tool calibration) are in increasingly short supply. And other industries that do not require workers to have the skills needed to build semiconductor fabs are recruiting from the same limited labor pool. McKinsey analysis indicates that about 100 workers are dedicated to the construction phase for approximately every $1 billion spent on fab construction. Construction engineering specialists make up around 60 percent of this headcount.
Engineers
Engineers are needed in a wide variety of roles to help operate the facility and carry out all aspects of production. In addition to varying levels of experience, engineers have four-year or advanced degrees in disciplines such as electrical, chemical, industrial, and computer engineering or certain material sciences.
Roles for engineers in manufacturing include the following:
- Process engineers oversee process stability and recipe development and optimization.
- Equipment engineers work with tool functionality and reliability as well as strategic improvement.
- Production control engineers manage and coordinate activities across modules.
- Manufacturing managers supervise manufacturing shift teams.
- Engineering managers supervise nonshift manufacturing teams.
There are also several engineering roles in integration and yield:
- Integration engineers develop, optimize, and stabilize process integration across modules.
- Yield engineers improve yield and run contaminant free manufacturing (CFM) and testing.
- Integration and yield managers supervise integration and yield teams.
Additionally, engineers are needed to test and analyze materials in central labs, ensure production and reliability quality, and oversee product management, including introducing major new products and supervising the life cycle of products from R&D tests to production. They also carry out industrial-engineering duties such as capacity planning and comprehensive line analytics.
Technicians
Technicians are also needed for a wide variety of roles, each requiring different experience, aptitude, and education. Most technicians are trained on the job or complete certification programs. Maintenance technicians typically have extensive backgrounds in machinery or factory work, and many have completed community college or trade school programs.
The talent pipeline for semiconductor fab technicians includes skilled workers in other industries that involve clean-room manufacturing, such as pharmaceuticals and biotechnology, medical-device manufacturing, chemical manufacturing, food and beverage processing, and aerospace manufacturing. Such workers possess a number of skills that make them well suited to roles in fab facilities and operations, such as knowledge of good manufacturing processes (including traceability and repeatability) and familiarity with rigorous safety standards and protocols (such as those developed by ISO [the International Organization for Standardization]) as well as documentation and quality control.
Similarly, workers with a background in heavy capital equipment and machining—including military maintenance crews, power generation systems, plastics and rubber machinery, and automotive and engine manufacturing—could do well in fab facilities, maintenance, and equipment roles thanks to their demonstrated mechanical aptitude for repairing, installing, and maintaining machinery; technical proficiency; ability to read equipment blueprints; and familiarity with troubleshooting, diagnosing, and correcting building systems and equipment.
Workforce development programs aimed at meeting talent demand
An estimated 60 percent of new jobs being created in the semiconductor industry (including skilled technical roles) will not require a bachelor’s degree. For this reason, workforce development efforts encompassed by the CHIPS Act focus overwhelmingly on technicians, supporting community college career and technical education programs and training initiatives such as apprenticeships. In addition, appropriations for these programs could be slow to come or fall short of amounts authorized in the CHIPS Act. The US Economic Development Administration’s Tech Hubs program, for example, while authorized to receive $10 billion over a five-year period, launched with $500 million in fiscal year 2023. Finally, there is the potential for programs to bring fewer net new additions to the workforce than predicted.
Several types of workforce development programs are already preparing workers for future talent demands in the semiconductor industry. Their impact timelines vary from a few years to decades.
Community college certifications
Community colleges are offering cost-efficient, targeted training and certification programs that make pathways to semiconductor technician roles available to a geographically broader and more diverse potential workforce. In 2023, for example, the state of Florida committed $50 million to semiconductor workforce development; this investment has supported several community colleges’ efforts to expand their semiconductor technician programs and develop new associate’s degree programs in engineering technology.
Resource networks
Collaborations among private industry, government agencies, and academic partners are creating resource networks to share knowledge and help strengthen students’ connections with prospective employers. For example, the Northeast University Semiconductor Network, a partnership among Micron Technology and several higher education institutions, aims to collaboratively develop curriculums that use industry-backed technical content and provide students with access to teaching labs and clean rooms.
Public–private partnerships
Company-funded, university-led initiatives to train future semiconductor engineers and technicians can leverage a feedback loop that aligns curriculum development with industry needs. The Intel Semiconductor Education and Research Program for Ohio, for example, has committed more than $100 million to funding semiconductor education and training. Programs led by eight higher education institutions across Ohio aim to collectively offer more than 2,300 scholarships and educate 9,000 students.
Institutional partnerships
Partnerships between universities and local community colleges, meanwhile, can help expand the potential workforce by developing opportunities at all levels and for every role in the semiconductor industry. One such partnership—Green2Gold, a partnership in Indiana between Purdue University and Ivy Tech Community College—offers a joint associate’s and bachelor’s degree in engineering. The program is part of a larger effort to expand the semiconductor talent pipeline in the region.
Youth outreach
Industry players can help foster a long-term talent base by raising awareness of career opportunities in semiconductors among middle and high school students. For example, as part of Samsung Austin Semiconductor’s 5-star Workforce Development plan, Taylor Independent School District (near Austin, Texas) received $1 million in funding to bolster career and technical education efforts via a summer internship for 24 high school students. The plan also targets two-year technical and trade schools, four-year colleges, community-based initiatives, and military and veteran partnerships.
Persistent workforce gaps, despite development efforts
Based on McKinsey analysis of program descriptions and announcements, workforce development programs are likely to employ around 12,000 engineers and 31,500 technicians by 2029. Nevertheless, even when these are combined with CHIPS Act efforts, optimistic projections indicate there will still be considerable shortfalls in the workforce, most notably the engineering talent pool (Exhibit 4).
The semiconductor industry clearly has pressing talent issues to address to fully realize the aims of historic investment and massive capital expenditures. A much broader range of collaborative initiatives will need to be deployed—simultaneously and in earnest—to mobilize the requisite talent within all three of the targeted labor pools. Programs and partnerships may require additional marketing initiatives to promote programs, wraparound community services to support trainees, and strong links between program curriculums and the skills employers seek to encourage program completions and align with hiring criteria.
A forthcoming article will delineate the scope of talent gaps in the United States semiconductor construction, engineering, and technician talent pools; the implications of such shortfalls; and potential mitigation strategies, including reimagining talent sourcing.
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