The Greatest Strength of the Semiconductor Industry…
People (or lack thereof)
Written by; Claus Aasholm, Semiconductor Market Research Expert
Claus is an expert at peeling back the layers of polished corporate messaging. His curiosity drives him to explore semiconductor companies, focusing on the complexities of their supply chains—both upstream and downstream. He compares companies to their competitors, uncovering key insights that often go unnoticed.
From Obscurity…
to a central role in global economics and security, the semiconductor industry has undergone a remarkable transformation. Once overlooked, it’s now the topic of dinner conversations, with questions about Nvidia’s stock price, ASML’s dominance, and industry leadership shifts. This shift reflects the industry’s critical importance to future economic development, fueled by the AI revolution and the U.S.’s push to bring semiconductor manufacturing stateside.
A Looming Talent Crunch?
Predictions suggest a significant talent shortage in the semiconductor sector. Deloitte estimates that by 2030, the industry will need over a million additional workers globally, while McKinsey emphasises retention strategies like expanding the talent pool and improving employee value propositions. The Semiconductor Industry Association (SIA) projects workforce growth of 115,000 jobs by 2030, with many at risk of going unfilled due to inadequate degree completion rates. However, these projections hinge on assumptions, such as U.S. policies on subsidies and immigration, which may not align with political realities.
Current Market Dynamics
The semiconductor industry is in an upcycle, yet headcount growth has stagnated since late 2022. Companies are primarily hiring to offset attrition rather than scaling up. This trend diverges from typical cycles, where growth accompanies increased demand. Nvidia, a key driver of recent revenue growth, has steadily expanded its workforce but has yet to significantly influence industry-wide employment figures. The foundry market, led by TSMC, has seen headcount increases in Taiwan, the U.S., and elsewhere. Conversely, integrated device manufacturers (IDMs) like Intel are shedding jobs, highlighting a shift in manufacturing dynamics. Despite TSMC’s recruitment efforts, the overall industry headcount remains flat, indicating limited hiring appetite or cautious optimisation by companies.
Employee Trends and Recruitment
Employee retention has become a focal point. While attrition rates have declined, signalling stability, recruitment remains essential to replace retirees and meet demand. The workforce’s average age has increased, and tenure has lengthened, reflecting fewer young hires. However, TSMC continues to attract talent, partly by increasing compensation, particularly in high-demand regions.
Recruitment data suggests minimal pressure on hiring packages, except in software development for fields like AI and machine learning. These areas show increased offers, but overall, salary growth for mid-level employees remains flat. This indicates that the industry’s stagnant headcount may result from deliberate strategic decisions rather than a talent shortage.
Conclusion
The current semiconductor upturn appears profit-driven, dominated by a few AI-centric companies. Nvidia captures a significant share of operating profits, while TSMC leads in foundry earnings. Despite fears of a talent shortage, evidence points to cautious hiring strategies rather than insufficient talent. For the first time, the industry faces an upturn without significant headcount growth, signalling a shift in how companies navigate cyclical changes. Whether this strategy can sustain long-term growth amid emerging challenges remains to be seen.
The Big Gap
Written by; Dr. Manfred Schlett
Dr. Manfred Schlett is a distinguished expert with an unparalleled depth of experience in the automotive and telecommunications industries. Renowned for his ability to blend technical insight with strategic vision, he has spent his career shaping the future of cutting-edge technologies and global business practices.
Some time ago a few analysts asked for my advice on whether NVIDIA’s stock prices would continue to rise or if competitors like AMD, Intel, Qualcomm, or tech giants such as Google, Amazon, and Microsoft would gain significant market share in AI chipsets. In preparing for these discussions, I stumbled across data that surprised me and clarified my conclusions.
Having spent years in the semiconductor industry, I’ve closely followed NVIDIA’s strategic moves, either as a partner or competitor. From NVIDIA + ICERA phone platforms to their graphics accelerators in automotive dashboards, server farms, and consumer PC graphics cards, their ambition was always evident. However, their current growth and dominance in AI are unprecedented.
To put it simply, NVIDIA is far ahead of its competition, making it difficult to foresee how others might catch up. Consider NVIDIA’s financial growth: its annual revenue hovered around $10 billion for years until the COVID-19 pandemic, which drove sales to around $30 billion. AMD, in comparison, grew its pre-pandemic revenue from $8 billion to about $20 billion. Both companies benefited from the increased demand for datacenter hardware, with AMD focusing on server CPUs and NVIDIA excelling in GPU-based parallel processing. The game-changer, however, has been AI. With the introduction of the H100 chipset and subsequent advancements like the H200, NVIDIA has established itself as the leader in AI hardware. Its revenue surged past $30 billion in 2023 and is projected to exceed $100 billion by 2024/25, driven by the AI boom. By contrast, AMD’s new MI300 AI chipset is expected to generate $5 billion in revenue in 2024. This creates a staggering 70:5 revenue ratio in the AI chipset segment, illustrating NVIDIA’s dominance. Similar disparities exist with other competitors.
What does this tell us? The semiconductor business thrives on scale, and NVIDIA’s massive lead puts it in a position to dominate. Competitors like Google, Microsoft, AWS, and Qualcomm are targeting niche markets, emphasizing specialized cloud services, better power efficiency, or lower costs. However, NVIDIA’s scale, established customer base, robust software ecosystem, and proven track record make it challenging to envision a significant shift in market share anytime soon.
Written by; Rob Picken
SVP Digital Transformation and Partnerships
Blindspots in planning – the unsustainable factor
In today’s world of advancing technology, tariffs, investment in facilities and deep shortages it’s easy to think that solutions are themselves technological. Much of the promised funding and construction – particularly in USA – is geared to safeguard supply chains, and to develop national resilience to external factors and risk.
While important – the ability to produce chips, to build stuff and physically have enough production capacity is key to the economy, not only votes in an election year – the press and coverage tends to gloss over one critical piece of the puzzle…..where are the qualified personnel going to come from to sustain this growth? To deliver the materials promised by politicians?
Looking to the USA for example, various think-tanks estimate a shortfall of 50-75,000 qualified people (heavily biased to engineering) by 2030. This may seem far off, but the problems are being felt now. Almost every one of the critical fabs and foundries committed to under CHIPS act funding are delayed. Why? Lack of personnel. If factories cannot be built, or advanced semiconductor capital equipment operated and calibrated then progress is necessarily delayed. I’d be keen to see an AI that can build a factory!
So how can you, as a consumer of talent, safeguard yourself against problems in finding enough people to run your operation? You could poach from competition, but that’s expensive and ultimately a zero sum game. You could re-hire your retired engineers as consultants, and pay them $1,000 a day. Or you can invest in training programmes, and develop your people from an early stage to bring in the customised, focused talent you desire. Perhaps you partner with technical colleges and offer apprenticeships.
People are a competitive advantage, but by their nature are not sustainable or resilient. Planning to sustain their capacity by augmenting their skills with data tools and systems is wise, but by developing process and strategy, hand-in-hand with a focused agency like IC Resources should be a go-to for your sustainability needs.
IC Resources highlights
James Cunningham – Business Development Director
Global growth, industry recognition, and a bright outlook for 2025
Our CEO and Co-Founder, Neil Dickins, has had a standout year. In recognition of his long-standing commitment to the UK deep-tech industry, Neil has received two prestigious awards. In December, the TechWorks ‘Contribution to Industry’ Award, and just last week he was awarded the Silicon Catalyst ‘Octagon of Excellence’ award in Mountain View, Silicon Valley. Neil also plays an active role with the UK Electronics Skills Foundation (UKESF), helping to bridge the skills gap and inspire future talent in electronics. His deep knowledge of the semiconductor and electronics sectors and his ability to identify emerging companies and trends continue to be a driving force behind our business.
Since January 2025, we’ve been actively expanding our global footprint and deepening our engagement within the tech community:
New Office in Austin, Texas
In March 2025, we proudly opened our fifth office in Austin, Texas, located in the Four Points area of West Austin. This strategic move strengthens our presence across North America and CALA (Central and Latin America), with a focus on semiconductor and software recruitment. The office will serve as a regional hub, tapping into Austin’s thriving tech scene. We’re delighted to have Tom Chapman as President and Zach Ward as Vice President of Sales leading the charge.
National Sponsorships
As part of our ongoing commitment to supporting innovation in deep tech, we’re proud national sponsors of key organisations who are driving progress across the semiconductor sector, including The Bessemer Society, ChipStart UK, and TechWorks. Through these partnerships, we help foster collaboration between visionary start-ups, industry leaders, and technical talent. Whether it’s championing early-stage ventures, contributing to thought leadership, or supporting UK tech on the global stage, we’re invested in the long-term growth of the semiconductor and wider deep tech ecosystem.
Here’s to continued innovation, collaboration and global growth in 2025 and beyond!
For more information on any of the articles featured in this edition of The IC Resource, or, if you would like to contribute to our future editions, please get in touch – james.cunningham@ic-resources.com or, +44 (0)118 988 1166.
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