MarketLine Blog

Semiconductor industry back on track

The global semiconductor industry recovered in 2013, growing by 5.4%, after a contraction recorded the year before. Regionally, the Americas showed the largest increase (11.4%), while Asia Pacific grew by 4.3% and Europe recorded a 3 % growth. At the same time sales fell sharply in Japan, contracting by -15%, mostly due to the devaluation of the Japanese Yen.

The United States has rebounded to once again become one of the largest and fastest growing regions for semiconductor manufacturing globally. The US semiconductor industry grew nearly three times faster than the global semiconductor industry as a whole, despite lingering macroeconomic difficulties. The government expressed support for several pro-growth policies, including basic research funding, immigration reform, and meaningful trade agreements, which should facilitate the industry’s growth going forward.

Semiconductor devices help reducing power consumption and heat dissipation, capture solar energy, create more efficient lighting solutions, and enable increased automation and efficiencies amongst other benefits. The performance gains provided by semiconductors are unheard of in any other industry, increasing by roughly 25-30% per year. Such devices can be found in the PCs we work on, the cars we drive, the phones we communicate with, all electronic gadgets for movies, music and games, as well as planes and weapons, to name a few.

The semiconductor industry has seen great changes recently, with most players streamlining operations and transferring more routine production to low-cost locations. This led to the development of the Asian market, where most memory production and backend operations have shifted.

Industrial consumption of semiconductors is linked to GDP growth within a country and therefore the industry is expected to grow at a faster rate in price-sensitive, emerging and developing economies, including Brazil, Russia, India, China and Africa.

Acceleration of growth is expected going forward, as environmental issues continue to come to the fore. The most significant factors in driving the semiconductor industry in the near future include the stabilization of the PC market, continued adoption of smartphones and tablets and the emergence of the new categories of wearable devices. According to World Semiconductor Trade Statistics (WSTS) all products and categories are expected to grow in the coming years, although wireless and automotive are projected to show the strongest growth.

For further reading, take a look at our Semiconductor Industry Profiles.

Posted in Manufacturing.

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