1、2022 semiconductor industry outlook23The chip shortage continues, as production will take time to catch up to demand 4The hunt for silicon talent intensifies 5The move to localize chip manufacturing gains momentum 6Digital transformation efforts accelerate 7Signposts for the future 8ContentsIn 2022,

2、 the global semiconductor chip industry is expected to reach about US$600 billion.1 But while its still dwarfed by farming, oil and gasindustries that are worth an annual US$10 trillion and US$5 trillion in revenue, respectively80% of the worlds food or fuel doesnt come from a handful of manufacture

3、rs concentrated in a just a few countries.Across multiple end markets, the absence of a single critical chip, often costing less than a dollar, can prevent the sale of a device worth tens of thousands of dollars. Based on our analysis, the chip shortage of the past two years resulted in revenue miss

4、es of more than US$500 billion worldwide between the semiconductor and its customer industries, with lost auto sales of more than US$210 billion in 2021 alone.2 Although annual semiconductor sales have traditionally trended upward, they have also demonstrated a characteristic cyclicality, with perio

5、ds of growth and contraction. In contrast, the growth in chip criticality has been a steady one that may even accelerate. Two factors are driving this trend. First, more and more products have at least some chips integrated into their design every year, and more and more products have more chips tha

6、n they used to, from connected devices in our homes to smart tags on every box in a warehouse. Thats not all; chips are also rising in their value and capabilities. For example, the semi content per car will roughly double between 2013 and 2030.3Although shortages have been painful for some customer

7、s, the chip industry itself is thriving. The Philadelphia Semiconductor Index (SOX) is up 117% in the past two years,4 while the Nasdaq has only been up 90%. Revenues, earnings, and cash flow are strong for chip companies, allowing for ongoing investment in new plants, new business models, and accel

8、erated digital transformation. Semi companies have also been making strides in their efforts at greater diversity, equity, inclusion, and sustainability. They are becoming more diverse and inclusive (specifically narrowing the gender gap5) and are committing to reducing their environmental footprint

9、. Interestingly, the sectors biggest challenge may be water usage,6 although improving their energy use is also a focus area.7Over the long run, semiconductor revenues are likely to oscillate around a trend line. Still, that trend line looks steeper than ever before as we enter a period of robust se

10、cular growth. We expect the global industry to grow 10% in 2022 to over US$600 billion for the first time ever. Growth will likely be down from 25% growth in 2021, in line with the Semiconductor Industry Association and World Semiconductor Trade Statistics.8 Chips will be even more important across

11、all industries, driven by increasing semiconductor content in everything from cars to appliances to factories, in addition to the usual suspectscomputers, data centers, and phones. We expect shortages and supply chain issues to remain front and center for the first half of the year, hopefully easing

12、 by the back half, but with longer lead times for some components stretching into 2023, possibly well into 2023. The ongoing talent shortage will be made even more severe by the addition of increased semiconductor manufacturing facilities outside Taiwan, China, and South Korea. The higher demand for

13、 software skills required to program and integrate chips into fast-growing markets such as electric vehicles, robotics, home automation, artificial intelligence, and 5G, as well as part of the shift from fossil fuels to green energy, will further exacerbate the shortage, and there is also an overall

14、 labor shortage. Finally, we expect the digital transformation within the industry to continue and accelerate. Nearly three out of five chip companies have already begun their transformation journey. Still, over half of those are modifying their transformation process as they go, in response to vari

15、ous pressures.9 Semiconductors have now established their place as a truly essential industry. There are multiple “essential” industries, of course: We cant do without food, energy, logistics, and so on. But it took the chip shortages of 2020 and 2021 for semiconductors to cement their “critical” st

16、atus. About outlooks Deloittes 2022 semiconductor industry outlook seeks to identify the strategic issues and opportunities for semiconductor companies to consider in the coming year, including their impacts, key actions to take, and critical questions to ask. The goal is to equip US semiconductor (

17、aka semi or chip) companies with the information and foresight they need to position themselves for a robust and resilient future.2022 semiconductor industry outlook2022 semiconductor industry outlook542022 semiconductor industry outlook2022 semiconductor industry outlookThe top semiconductor issue

18、of 2021 was the imbalance between supply and demand. This imbalance led to chip shortages that affected both traditional chip end markets, such as data centers and smartphones, and traditionally less dependent markets, such as automotive, consumer white goods, andrather infamouslydog-washing machine

19、s.10 If you guessed that supply and demand will also be a top issue of 2022, youre likely to be right. However, next year will not be an identical repeat of 2021. In contrast, we expect the severity and duration of the chip shortage, and its economic ramifications, to be less pronounced because of i

20、ncreased capacity, but also from supply chain improvements that chipmakers, distributors, and end customers make.Adding new capacity began in 2021 but wont be operational until 2023 at the earliest. Luckily, some new capacity additions were already in the pipeline before the shortagewe expect to see

21、 200-mm wafer capacity rise by more than 10% for the year, while 300-mm will be up by 15%. In terms of process technology, our analysis (based on Gartner data) suggests the most advanced nodes (10 nm and under) will grow 24% year over year in 2022; intermediate nodes (14 nm to 45 nm) will grow 14%;

22、and mature nodes (65 nm and above) will grow by 9%.11 Although much attention has been paid to more advanced nodes, its worth noting that even in 2022, mature node manufacturing is expected to account for nearly 64% of global chip output, measured in wafer equivalents.12 More capacity is a good thin

23、g; however, other, less obvious supply chain improvements may positively impact excessive lead times just as much. These fall into two interdependent trends: moving to a digital capabilities model and collaborating on a digital supply network. And while neither trend started amid the pandemic and it

24、s related shortages, both were accelerated because of it.To find their footing in 2022, semi companies should move to a digital capabilities model, and should redesign their traditional organizational silos to create a more connected and integrated modelone that encompasses their customers, talent,

25、suppliers across all tiers, channel partners, and internal facilities. They should also work to adopt better customer connections, synchronized planning, dynamic fulfillment, supplier collaboration, operations command centers, and digital development.A widespread post-pandemic worker shortage prevai

26、ls, propelled in part by the “Great Resignation,” in which more than 4 million American workers quit their jobs in August 2021 alone.14 The semiconductor industry is also feeling the pinch, albeit exponentially worse. In addition to sharing the factors affecting other industries, the chip business h

27、as four megatrends that are making the war for talent even more severe:1. Global semi industry revenues by the end of 2022 will be almost 50% higher than at the end of 2019.15 2. There were already talent shortages in Taiwan and South Korea in 2017. The talent pool in those areas was relatively well

28、 developed, but recent growth has nearly exhausted it.16 3. Over time, building more local chip fabrication plants (aka fabs) in the United States, China, Singapore, Israel, and other countries will allow chip companies to access a broader, deeper pool of talent. In the short term, although there ar

29、e millions of talented workers in those areas, they must be trained to acquire essential skillsa necessary step that will not be resolved in 2022.4. The mix of job skills is changing, and the industry has a strong need for software skills. Our analysis of multiple industry estimates suggests that gl

30、obal electronic design automation (EDA) software revenue is anticipated to double from approximately $10 billion in 2020 to $19 billion by 2027. The need for software hires is likely to follow a similar trend.On a global level, the most severe talent shortage this year is likely to be in China. Ther

31、e were about 510,000 professionals in semiconductor design and manufacturing in the country as of 2019. A 2021 report suggested a talent shortfall that year of about 300,000 workers, a number projected to fall only slightly to 250,000 by 2022.17 There are about 280,000 American professionals in semi

32、conductor design and manufacturing.18 New plants in Arizona and Texas will likely create close to 5,000 high-tech manufacturing and engineering jobs, and other proposed new plants could more than double that number.19 Even as domestic chip companies are experiencing engineering and manufacturing tal

33、ent shortages, they are also facing competition for talent from other tech majors aggressively expanding in high-growth areas, including artificial intelligence (AI), edge computing, robotics, 5G, and smart devices.20 These technologies demand similar types of skills, intensifying the ongoing battle

34、 for semiconductor talent. The chip shortage continues, as production will take time to catch up to demandThe hunt for silicon talent intensifies Meanwhile, semiconductor producers, distributors, and customers should work together to transform their legacy supply chain into a digital supply network,

35、 by sensing, collaborating, optimizing, and responding with greater agility. As an example of effective collaboration, companies can work closely with ecosystem partners (both upstream and downstream) to facilitate real-time information sharing and understanding, in addition to greater capturing and

36、 addressing of the potential impact to sensed signals. As an example of better data sharing from 2021, one prominent Silicon Valley company that shared its chip needs with manufacturers for the next 12 months moved to five-year forecasts instead.13 The chip industry can help address its talent short

37、age by more proactively engaging with universities to advance STEM skills of graduates and bolster innovation. Both efforts are critical to helping the United States sustain its long-term global semiconductor leadership and competitiveness.21 Another step chip companies can take to address the talen

38、t gap is to directly tap into international alliances and ecosystems.22 To cater to the growing hybrid work model, semi companies need innovative ways to help enable collaboration between core manufacturing, technical, and R&D staff. Several companies already seem to be on this path: 42% identified

39、corporate culture/environment and collaboration as crucial for their business transformation.23Major chip manufacturers also enhanced their work/life balance initiatives, employee assistance, and well-being programs to better support their organizations during the pandemic. 2022 will likely require

40、them to be even more agile with their workforce development and employee benefit programs, both of which will prove crucial to their ability to retain and grow talent. How can C-level executives balance their actions and investments that they are making toward alleviating or expediting shortages in

41、the short term versus longer-term fixes to capacity and supply chain? How can a better view of true aggregated demand forecast be developed realistically (e.g., by filtering out double/triple-counting, over optimism), while gaining insight into the real supply capacity investment needed? How can the

42、 changing nature of demand from core devices to edge/IoT/5G-enabled devices be addressed? This shift to the edge is changing the ecosystems, products, and routes to market that semiconductor companies have to operate in, and there are big operating model, partnership/channel, and product strategy de

43、cisions they should make. How can a better end-to-end, multi-enterprise view of the supply chain be built by considering vital aspects related to data sharing, privacy, security, and confidentiality? As companies adopt alternative talent strategies to cater to a distributed workforce, what local- an

44、d state-level tax policies should be considered, and what specific roles should be permanent or full-time versus contract-based? How can companies develop and train their talent pool in a hybrid work model by leveraging a banquet of options such as on-the-job training, self-paced learning, and onsit

45、e/offsite mentorship? What specific tasks can be automated or robotized within each job role? How can companies enhance the human-machine connection, such as using augmented reality (AR), virtual reality (VR), mixed reality (MR), or AI for more effective teaming and productivity? Strategic questions

46、 to consider:Strategic questions to consider:76The global semiconductor industry is committing to increasing their overall output capacity at an unprecedented level. Capital expenditures from the three largest players will likely exceed $200 billion from 2021 to 2023.24 Governments have committed hu

47、ndreds of billions of dollars more.25 We expect global wafer starts to be fully 50% higher by the end of 2023 than they were in 2020. Some will occur in traditional manufacturing clusters located in Taiwan and South Korea; but increasingly, they will be in the United States, China, Japan, Singapore,

48、 Israel, and Europea trend known as “localization”26increasing chip production closer to the next step in the supply chain.There are multiple drivers for localization; although, it is worth noting that it reverses a multi-decade trend to a well-developed and fine-tuned global supply chain. From chip

49、 design and wafer manufacturing, to packaging, testing, original equipment manufacturer (OEM) assembly, and more, there are dozens of countries involved. Moving global supply chain capabilities into a single country or region will not be easy, but when making the argument for localization, here are

50、some things to consider:1. As the pandemic has demonstrated, having “all your semiconductor eggs in one basket” leaves multiple industries vulnerable to the hazards from having manufacturer and consumer thousands of miles apart: blocked canals, jammed ports, and so on. Over 60% of all chips were mad