Semiconductor Employment in the United States

According to the Bureau of Labor Statistics, the semiconductor/electronic components industry lost 15.3% of their total jobs since December 2007 (see chart below). That’s three times more than finance and insurance industries, and in the range of furniture and textiles, two low-tech, labor intensive industries that have been racing to Asia for several years. This dramatic employment decline reflects a catastrophic failure of public policy and a historic abdication of responsibility by elected leaders. While Washington debates the need for million dollar bonuses on Wall Street, a trillion dollar overhaul of the health care,industry, and yearly farm subsidies in the tens-of-billions, the global high tech industry is happy to move anywhere they are wanted, nurtured and welcome.

Increasingly that is not the US, and the situation is getting worse, not better.

When honest observers look at the reasons for high tech’s flight offshore, it will be hard to discount the fact that semiconductor, Internet and computer industries rank near the bottom of the list in political campaign contributions. Securities traders, health care professionals, lawyers, insurance companies, and real estate are all in the Top 10 in campaign contributions. Computers/Internet ranks 37, right after railroads and Beer/Wine/Liquor (there is no separate category for semiconductors).

One of the issues that showcase the total disrespect and criminal neglect of high technology by elected officials is the failure to reform of the H-1B visa process. Foreign born nationals who receive their science and engineering degrees in the US should not be forced to leave the country upon graduation. SEMI goes to Congress every year and no one—not one staffer, not one representative—will argue against expanding the number H-1B visas for US graduates of science and engineering. Yet the bills can’t get out of Committee, and can’t get a vote.

The impact on US high technology has been devastating. The US has been skimming the best and brightest minds from across the globe, and prospering because of it. Between 1980 and 2000, the percentage of Ph.D. scientists and engineers employed in the United States who were born abroad increased from 24% to 37%. The current percentage of Ph.D. physicists is about 45%; for engineers, the figure is over 50%. One fourth of the engineering faculty members at U.S. universities were born abroad. Between 1990 and 2004, over one third of Nobel Prizes in the United States were awarded to foreign-born scientists. One third of all U.S. Ph.D.s in science and engineering are now awarded to foreign born graduate students. Today, the number of applications for H-1B visas exceeds the “quota” by at least three times. Foreign born engineering and science graduates now expect to find jobs outside of the US upon graduation.

In the recent past, the arguments for high technology centered on the benefits of economic growth, the proliferation of high paying jobs, and national security. Today, the need for a healthy high tech industry increasingly involves global warming and energy security. Here, semiconductors and semiconductor technology are the principal means to replace fossil fuels and create energy independence. Faster, better, and cheaper microprocessors have a direct and immense impact on energy efficiency. The Bureau of Economic Analysis (2007) reports that while the economy as a whole increased energy use by 13 percent over the period 1997 through 2007, the semiconductor industry actually cut energy use by half over that same period.

According to the American Council of Energy Efficiency Economy, the cumulative net electricity bill savings enabled by semiconductors might exceed $1.2 trillion through 2030, supporting some 935,000 more jobs while substantially reducing 700 million metric tons of carbon emissions.

Much of the same technology that made the US number one in semiconductors is also used in photovoltaic and solid state lighting, technologies essential to our energy future.. Rather than leveraging this technology heritage into leadership positions in these critical industries, the US has squandered its lead and is barely a participant in either of these of high growth sectors.

It is astounding that we allow our elected leaders to reap millions of campaign contributions sustaining 18th century industries when the opportunities and benefits in semiconductors and high tech can yield economic growth, quality jobs, energy efficiencies, and cost effective renewable energy for decades to come. Politicians need to be made accountable for economic policies that moves billions into corporate farms, gangster banking and profiteering health care, while it forces ingenuity, innovation and well-earned prosperity overseas.