Taiwan to invest $300M in grad schools to stem chip brain drain

The Nikkei Asia has reported how Taiwanese authorities and major chipmakers are investing at least $300 million to create graduate programs for the semiconductor industry over the next decade. The move aims to protect the island’s chip economy as the USA and China seek to cultivate their own talent and bring production onshore. Taiwan Semiconductor Manufacturing Co., the world’s biggest chipmaker, and local peers such as MediaTek and Powerchip Semiconductor Manufacturing Co. have also told Nikkei Asia they would endorse the campaign to build additional high-end chip schools.

President Tsai Ing-wen and Vice Premier Shen Jong-chin pushed the talent cultivation plan when major companies requested state assistance to solve the talent shortage around May last year. A person with direct knowledge told Nikkei Asia:

“More than a dozen chip companies — from design, manufacturing to packaging and testing — actively participated in the discussions for chip schools, as they foresee that demand for high-skilled chip talent will be even higher in the coming years, and that this is an imminent problem that needs to be solved soon.”  

Taiwan’s semiconductor industry, second globally to the USA, has been suffering from insufficient talent for years as the sector continues to pursue cutting-edge technologies. Ministry of Education data shows the number of Ph.D. students majoring in tech-related fields dropped from 23,261 in 2010 to 16,950 in 2020.

The Nikkei Asia article also noted a recent supply chain review report by the White House that said the country “has an immediate need for highly skilled workers in the semiconductor industry” as 77% of surveyed chip executives said the industry is facing a critical talent shortage. The report added:

“As China increasingly seeks out foreign talent, retaining these students in the United States serves to both bolster the domestic semiconductor industry and prevents competitors from acquiring the talent necessary to surpass the United States.”

Meanwhile, China has said that a lack of chip talent is one of the country’s biggest hurdles to building a competitive local chip industry. The country has been increasing the number of microelectronics schools over the past few years as an additional 230,000 engineers will be required by 2022 to keep up with demand.

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