The National Semiconductor Strategy: A good start, but what comes next will be critical to its success or failure
techUK welcomes the Government’s newly-launched National Semiconductor Strategy, a plan meant to bolster the UK’s semiconductor industry and secure its place on a global stage.
The National Semiconductor Strategy sets out a package of funding and support for the UK’s semiconductor industry that looks to provide critical support for the UK industry’s leadership in research, design, and intellectual property, alongside mapping further support for strengths in compound semiconductors. The Strategy aims to deliver by growing the domestic sector, mitigating the risk of supply chain disruptions, and protecting the UK’s national security.
The Strategy’s objectives match much of what industry has called for—in techUK’s “A UK Plan for Chips,” we outlined five key principles that the semiconductor industry needs to have successfully implemented by the Strategy. They are:
Retain our position as a global leader on chip IP and design,
Incentivise investment in advanced designs, new materials, and new fabrication plants,
Partner with our global allies on supply and monitor the UK’s access to chips,
Nurture the skills we need for the chips industry, and
Ensure access to markets and private capital.
Many of these recommendations are supported by different parts of the Strategy, with the domestic growth portion of the Strategy aiming to enhance the sector’s R&D, launch new infrastructure initiatives, and support greater access to skills and talent for the industry. The Strategy also looks to safeguard the UK against supply chain disruption, targeting domestic resilience planning, access to critical industries and manufacturing, and pursuing international cooperation that will underlie the domestic industry’s success.The Strategy sets out key actions to support these, including an advisory panel, an infrastructure initiative, resilience and strengths mapping, and engagement with international partners. Though these ideas are well founded and signal a good start for the industry, the success of it all will come down to implementation.
The funding package for the Strategy tops out at £1 billion over 10 years, and although this funding is less than the US and EU’s funding amounts, the UK Strategy has set different objectives aiming to boost existing strengths and grow the UK’s market share in new and emerging chip technologies rather than seeking to turn the UK into a base for the fabrication of expensive high end silicon chips.
This Strategy has the potential to be the right plan for the UK semiconductor industry. Its plans to revitalise R&D is critical for the UK semiconductor industry—international R&D collaboration, stronger partnerships with the UK’s world-leading universities, and bolstering of domestic R&D will ensure that the UK continues to advance the semiconductor industry through ground-breaking design and leaders. Strengthening design strengths and academic partnerships in clusters will not only support the industry at the national level but also revitalise clusters and enhance regional growth prospects. Industry and academia in South Wales, Cambridge, Scotland, and other parts of the UK will stand to benefit for their leadership in semiconductors and collaboration with Government in the implementation of this plan.
International partnerships will be essential to backing up the strengthening of the domestic sector. With greater access to international markets and targeted partnerships with like-minded nations, the UK’s strengths can provide a boon for the nation’s leadership. As key partners like Japan, the US, the EU, and others enhance their industries, the UK must work collaboratively to ensure a place in a resilient and diversified supply chain for its own. If the Government can support domestic industry’s participation on a global stage, the UK’s strengths in design, IP, and compound semiconductors will be rewarded domestically.
Additionally, the Strategy’s focus on increasing access to skills for the semiconductor industry underlies the functioning of this Strategy, and the proposed “industry-led learning” initiative has the potential to achieve that. The UK’s educational institutions are world leaders in science and technology, and this Strategy must capitalise on ensuring pipelines for research and jobs for talent. Skills redevelopment and exchanges are also vital tools that must be considered in the implementation of this Strategy, and if executed properly, these can support the UK’s semiconductor clusters and industry to build out regional and national economic and technology leadership.
There remain some questions regarding the use of the funding, with the Strategy hinting that further details will be announced by the Autumn. Additionally, national security legislation concerns have featured heavily, with the Government unwinding the acquisition of the Nexperia wafer fab citing national security concerns. To build industry’s confidence and to make this Strategy the success it can be, Government must ensure it works to answer deeper questions and proactively communicate with industry.
The National Semiconductor Strategy is a good start and if implemented well, has the potential to deliver for the industry, but this can only be done if Government acts quickly on delivery and leverages the wealth of knowledge, expertise, and potential that the domestic semiconductor industry has.
Industry is ready to work with Government and academia to carve out a greater place for UK semiconductors in a rapidly changing and increasingly competitive global economy, so it must be worked towards.