Chip industry faces bleak future as young talent turns to medicine

Home > Business > Industry

print dictionary print

Chip industry faces bleak future as young talent turns to medicine

Visitors examine a semiconductor wafer at the Semiconductor Exhibition held at Coex, Gangnam, in October. [NEWS1]

Visitors examine a semiconductor wafer at the Semiconductor Exhibition held at Coex, Gangnam, in October. [NEWS1]

 
Korean chip companies, grappling with an existing shortage of workers, anticipate more severe labor challenges in the upcoming years, as a strong preference for medical schools draws promising students away from the tech industry.  
 
The country’s semiconductor industry will face a labor shortage of 56,000 people in 2031, according to the Ministry of Education’s report on the semiconductor industry labor market published in 2022. The number stood at 1,784 people in 2022. The difference has swelled by 30 times over in the span of 10 years.
 
“Humans are the most important resource a company needs to sustain its business,” Kyung Kye-hyun, head of Samsung Electronics’ Device Solutions Division, said while talking about the labor shortage in the chips industry in a lecture given at Seoul National University (SNU) in September. Out of SNU’s 28 natural sciences and engineering masters programs, where many of Korea’s key materials in technology research and development (R&D) have been published, 16 programs did not have enough students to meet their maximum quota.
 
The number of semiconductor industry newcomers is far below the industry labor demand. [YOO YOUNG-RAE]

The number of semiconductor industry newcomers is far below the industry labor demand. [YOO YOUNG-RAE]

 
“The concentration [of students] going to medical departments is one of the many reasons for the labor shortage,” a semiconductor industry insider said. “Compared to our [Korean] society’s large interest in medical schools, the disinterest in the technology industry, which has a huge impact on the country’s economy, is quite bizarre.”
 
It’s not just Korea. In February last year, U.S. Secretary of Commerce Gina Raimondo promised $39 billion in incentives for U.S. semiconductor manufacturing. A further $13.2 billion will be allocated to “build a strong semiconductor R&D ecosystem” to generate ideas and attract talent, indicating a global demand for workers in the chips industry.
 
The Bank of Korea emphasized the semiconductor industry’s contribution to Korea’s economy in its projection for economic growth, creating separate categories that calculate economic growth with and without the industry, which is 2.1 and 1.7 percent, respectively. There looms a sense of crisis that if the labor shortage in the semiconductor industry, which determines the nation’s economic growth, is unaddressed, Korea’s growth engine will collapse.
 
The government is expected to announce in February its plans to increase the total admission quota for medical schools in Korea by 2,000 students. College admission experts say that hypothetically, “all students admitted to SNU’s STEM programs could switch to medical schools,” referring to the 1,795 students who were admitted to SNU’s engineering and natural science degree programs.
 
Kyung Kye-hyun, head of Samsung Electronics’ Device Solutions Division, gives a lecture on the future of the semiconductor industry at Seoul National University in September. [SAMSUNG ELECTRONICS]

Kyung Kye-hyun, head of Samsung Electronics’ Device Solutions Division, gives a lecture on the future of the semiconductor industry at Seoul National University in September. [SAMSUNG ELECTRONICS]

 
The car industry is also facing labor shortage problems. The Automotive Industrial Skills Council estimated in 2022 that the automobile technology industry needed 40,000 workers until 2028. The AI industry will have 128,000 workers less than what the industry demands from 2023 until 2027, according to the Ministry of Employment and Labor.
 
The outcome is the combined result of a strong preference for medical schools, the drop in the working age population due to record-low birthrates and brain drain, with an increasing amount of highly skilled professionals going overseas.
 
Employees are already having trouble employing workers with both research and field experience. “Even the people in charge at large semiconductor companies in Korea don’t know much about on-site work, to the extent that they have not visited the clean room even once,” an industry insider complained.
 
As cutting-edge technology industries grow rapidly, the labor shortage has been felt among most technologically advanced countries.
 
The biggest hurdle for the United States, in which the government is pursuing domestic chip manufacturing, is finding human resources. Taiwan’s TSMC, Samsung’s biggest competitor in the semiconductor fabrication market, is seeing delays in operations for the company’s fabrication plant in Arizona because of a shortage of chip professionals.
 
The U.S. Semiconductor Industry Association (SIA) proposed plans to expand local support programs, increase the admissions quota for engineering courses and attract international students to fill up its labor shortage for the semiconductor industry, which is estimated to be short of 67,000 workers in 2030. The association in particular argued that immigration policies be relaxed so that engineering students in masters and doctorate programs can remain in the United States after graduating.
 
Governments in other countries have already reformed laws and systems to accommodate industry labor demand. Taiwan revised its law last year to allow the immediate issue of visas for foreign graduates of the world’s top 500 universities who pass the interview process at Taiwanese chip companies. Japan issues a two-year visa to foreigners who graduate from a global top 100 university that allows them to freely find employment in a high-tech industry.
 
Korea also created a visa for technology industry professionals in January last year, but its qualification criteria has been criticized as too strict and its benefits inferior to other competing countries, as it takes into account Korean proficiency test grades and study experience in Korean universities, and only recognizes full-time employment as work experience.
 
Semiconductor companies that created semiconductor contract programs with engineering schools before and after 2010 may also see a drop in applicants after the increase in the quota for medical school admissions. Currently, Sungkyunkwan University and Yonsei University operate contract programs with Samsung Electronics, while Korea University operates one with SK hynix.
 
Though such departments are not as popular as those in medicine, dentistry, traditional Korean medicine, pharmacy and veterinary studies, the competition is relatively fierce as the programs provide scholarships and guarantee employment after graduation. This year’s early admission acceptance rate for Sungkyunkwan University’s contract program was 32.1:1 while Korea University’s was at 13.5:1.    
 
Major university contract programs' acceptance quota was at around 500 students this year. However, in this year’s college admissions, the rate of those who were accepted into, but did not register for, enrollment at Korea and Yonsei University’s semiconductor contract programs through regular admissions stood at 130 percent and 70 percent, respectively.  
 
College admission consulting center Jinhak analyzes that most of such students had been weighing their options between medical departments and computer science or electronic engineering departments at other schools. But if the quota for medical school admissions is increased, the semiconductor-related departments will likely see its candidates who have also been accepted into medical schools outside of Seoul choose the latter.
 
“In the past, applicants to medical and engineering programs would have prepared separate student records to apply. As the [requirements for] student records for early admissions are simplifying, there will be more students who apply to and get accepted to both medical and engineering schools,” said Lim Sung-ho, head of Jongro Academy.
 
Admission candidates and their parents say “the semiconductor department’s direct connection to the industry is both a merit and a vice.”
 
Kim, an 18-year-old student at a school in Seoul, considered enrolling in a semiconductor program but ultimately applied and got accepted into Korea University’s electrical engineering school. “Though I was intrigued by the guaranteed employment at Samsung or SK, I hesitated because the program was made for a need in industrial manpower,” he said.
 
Industry workers say that while the semiconductor industry might fluctuate in growth temporarily, it will grow in the long term. But from a student’s perspective, worries remain about being unable to find employment in the case of an industry downturn at the time of graduation.

BY YOON SUNG-MIN, SHIM SEO-HYUN [[email protected]]
Log in to Twitter or Facebook account to connect
with the Korea JoongAng Daily
help-image Social comment?
s
lock icon

To write comments, please log in to one of the accounts.

Standards Board Policy (0/250자)