Growth of wireless, IoT and cars will drive demand for semiconductors

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The ongoing deployment of 5G networks, IoT and the automotive sector are the top three drivers of semiconductor revenues in the coming fiscal year, according to a new survey and analysis released by KPMG.

The accounting firm noted that semiconductor manufacturers have changed their organizational structures in response to these trends, with 53% of respondents saying they have focused more on specific operational requirements for hot applications – and away from general purpose chipsets that can be used in multiple products.

“Indeed, the top challenge in terms of product development and getting to market, cited by 30% of respondents, is that customers are demanding more complex solutions,” the report said.

The industry sees microelectrical sensors and mechanical systems as the biggest growth category for its products, according to KPMG, with microprocessors in second place and analog/RF chips in third. The continued strong growth in demand for sensors/MEMS (micro-electro-mechanical systems) is largely due to the growth of IoT deployments, which tend to require many sensors.

The main source of demand, however, was wireless communications, as 5G rollouts in the United States and elsewhere continue at a rapid pace. 5G deployments require denser placement of base stations, which means more silicon is needed to serve a given geographic area. Therefore, it’s easy to see how 5G has bolstered demand for semiconductors.

Retaining talent is a top priority for chipmakers

Unsurprisingly, given the ongoing supply issues that have plagued the industry, well over half of respondents said supply chain is a top strategic priority – but most surprising is the fact that it doesn’t. is not the most common answer. Instead, 77% of companies surveyed said talent retention was among their top priorities, compared to 60% who said the same about sourcing issues.

“The industry has faced a talent shortage for several years as non-semiconductor companies have begun to develop their own silicon chips and capabilities,” the report said.

Part of the reason talent is such a high priority, according to KPMG, is simple math – with nearly nine in 10 semiconductor companies planning to increase their workforce over the next 12 months, and about a third expect to do so by a factor of 10% or more, it is unclear where these new semiconductor workers will come from.

“In this environment, companies would do well to think seriously about upgrading and retraining existing workers, launching apprenticeship programs, and partnering with colleges and universities to increase the number of graduates with degrees. relevant technologies,” the report’s authors said.

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