Amid dour economic outlooks, the local semiconductor industry is still booming

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Digital Reporter

Earlier this year, Semiconductor and Electronics Industries in the Philippines Foundation, Inc. (SEIPI) projected a 6% growth in export sales, which they considered to be conservative amid the projected increase in demand for the commodity.

As of August this year, electronic product exports grew 7% year-on-year to $3.35 billion in free-on-board value, data from the Philippine Statistics Authority shows.

Semiconductors in particular posted a 7.7% year-on-year growth to $2.51 billion, taking up a 40.8% share of the whole commodity group.

But with the impending second package of Tax Reform for Acceleration and Inclusion (TRAIN) law expected to drive out investors by “rationalizing” the tax perks in the Philippines, exports-oriented industries—as well as investment promotions agencies—are less than optimistic about the near future.

US-based Maxim Integrated Products, Inc., however, claims the semiconductor industry will continue to grow for two reasons: Existing infrastructure and the workforce.

In fact, growth in this sector has been so rapid, demand for workers has outpaced labor supply. With 2,600 employees currently working at its testing facility in Cavite, Richard Allen Cohen, vice president for Maxim Integrated’s Asia factory operations, said they are still scrambling to make sure that they don’t run out of workers.

Maxim, a member of SEIPI, has been scouting for talent in colleges and universities throughout the country. To date, they’ve partnered with around 20 colleges and universities to “get the electronic courses to be more applicable in the semiconductor industry,” Cohen said.

Amid its campaign to help steer the country’ education system to suit the needs of the semiconductor industry, Cohen confessed that they still find it “a little hard to influence” as colleges and universities focus on getting their students to pass the board exams, rather than keep up with the demand of the industry.  

“A lot of the courses here [in the Philippines] really focus on the software and communications and those kind of things, specifically the products we make are for analog. They don’t teach a lot of that for school,” said John Nichols, Maxim’s vice president of Philippine operations.

According to Nichols, Maxim has been providing additional training for their workforce to suit their needs for 20 years. This includes both coursework and “hands-on” training where the future employees’ skills are applied on the line with a senior engineer in attendance.

Those who are accepted in their company undergo a three-month long training in its Cavite facility, with a preference for graduates of its internship program—about 60 to 70 a year.

“[O]ur hope is as people learn about the jobs in the industry and how good these jobs are, and how they can really have careers in the Philippines,” Cohen said. “They don’t have to go overseas. Then more and more kids and their parents will be attracted to our industry and provide us with more people.”

“[We have] to continue hiring. We need good people, no matter what,” he said.