Semiconductor chip shortages have sent shockwaves around the world, affecting
most industries and might even harm the global economy soon. Since the era
of computers and automation, the demand for semiconductors has increased to
What exactly is
a semiconductor chip?
A semiconductor is a substance that conducts electricity more
than an insulator but less than a pure conductor and is found in thousands of
A semiconductor chip is an electric circuit constructed on a
semiconductor wafer that contains several components such as transistors and
semiconductor chips used?
Semiconductors are used in thousands of items, including
computers, smart phones, appliances, gaming devices, automobiles, and medical
Semiconductor shortage in the world?
The reason may be traced back to when covid-19 began, when
there was a large drop in demand for semiconductors due to reduced demand
because of mandated lockdown in practically all parts of the world, which
impacted the production process and demand.
As soon as the manufacturing process began, electronic goods
makers proceeded to submit orders, resulting in an ongoing backlog to meet the
demand for chips from chip manufacturers.
Other reasons that fueled the fire included a storm that
briefly halted all manufacturing operations in TEXAS around February, as well
as US-China tensions that suspended all foreign companies that use American
chip technology to sell to Chinese factories.
industries are being impacted by the chip shortage?
Most industries have been disrupted as a result of the
semiconductor shortage, which is expected to cause billions of dollars in
losses in the near future.
have reduced automobile output;
b. Mobile phone
businesses have delayed production; and
c. Gaming companies such as Xbox and PlayStation have cut
production to half.
When will the
semiconductor industry be able to meet incoming and future demand?
Since the influx of demand, firms have begun producing chips
at full capacity, but the damage has been done, and it is likely to recoup in
2-3 years, according to industry analysts.
Some countries have stepped in and implemented steps to
increase demand and fill the demand gap that has been created.
South Korea promised a massive $451 billion investment, while
the US Senate proposed $52 billion in chip factory subsidies.
Tata Group Chairman N Chandrasekaran stated on August 9, 2021
that the Tata Group is aiming to enter semiconductor manufacturing and has
established a business to capitalise on the opportunity.
The Ministry of Electronics and Information Technology
intends to reform its policy framework, in which the government would take a
more active role in expanding the sector by luring more private businesses and
giving early money to help India become a worldwide semiconductor hub.
Chip Shortage, global economy, automobile sectors, Covid-19, finance updates,