U.S. Chip Manufacturing Faces 157,000-Worker Shortage as Samsung, TSMC Seek Talent

Jon Taylor, executive vice president of Samsung's semiconductor division in Austin, Texas, told CNBC he was concerned about the talent pipeline. 'I'm concerned,' Taylor said. 'We just don't see that there's enough technical people in the pipeline.'

Only 3 percent of U.S. graduates who take engineering roles enter the semiconductor industry each year, according to McKinsey, and 73 percent of chip employers report significant difficulty filling engineering positions. Engineers and skilled technicians are crucial as the U.S. undergoes its fastest chip manufacturing buildout in history, aiming to make enough memory and logic processors to power AI.

Taiwan Semiconductor Manufacturing Company and Intel are now producing advanced logic chips from new fabrication plants, or fabs, in Arizona. Samsung will be the next chipmaker to manufacture advanced logic in the U.S. when it starts production at the first of two new fabs in Taylor, Texas, later this year. It is part of a $35 billion buildout in the state, and Samsung said the two new fabs are expected to create about 3,500 jobs.

'We're hiring engineers, we're hiring technicians, we're hiring people in supply chain,' Taylor said. 'Everybody wants and needs the same thing, and it's a bit of a race against time right now as everything is starting to come online.'

While America is the birthplace of semiconductors and leads the world in chip design, almost all advanced chips have been manufactured in Asia for decades. That is where talent pipelines are strongest. Idaho-based Micron has held expedited hiring sprees at technical universities in South Korea, interviewing students and offering them permanent positions at its Asia fabs, all in a day, according to CNBC.

The shortage comes as U.S. college students see fewer software engineering roles and more uncertainty in the job market because of AI, CNBC reported. Purdue University and Arizona State University are spending millions of dollars to launch programs that prepare U.S. students for chip roles. Michael Crow, president of ASU, told CNBC that the university is already the largest producer of college graduates for Intel globally and is trying to become that for TSMC.

Still, U.S. chip jobs often pay far less than comparable roles in South Korea, where chip workers are highly sought after and bonuses have risen sharply. CNBC reported that when thousands of workers threatened strikes at Micron, Samsung and SK Hynix, bonuses ballooned upwards of $500,000. Salaries in the U.S. typically range from $127,000 to $187,000, with senior positions exceeding $238,000, according to the SEMI Foundation. Crow told CNBC that companies will have to pay higher salaries as workers evolve their skills. 'As people continue to evolve their skills, they're going to have to pay higher salaries,' Crow said. 'Particularly as they're scaling and scaling and scaling and the workforce demands are so significant.'

Workers are in especially high demand at major memory makers, which are racing to add capacity during a global shortage that has Nvidia and Advanced Micro Devices scrambling to secure supply. The epicenter of the buildout is South Korea, where CNBC got an exclusive first look at the world's largest memory campus that SK Hynix will start to bring online in February. Although Micron currently makes all advanced memory in Asia, it is building America's first advanced memory fab in Boise, Idaho, set to open next year, with another under construction in Clay, New York. SK Hynix is building its first U.S. facility, at Purdue Research Park in West Lafayette, Indiana, although the $4 billion fab is for packaging memory chips instead of front-end manufacturing. SK Hynix and Micron will compete for a small pool of U.S. memory chip workers.

'We can secure a number of high-quality employees within a few years, based on the collaboration with the local community,' SK Hynix CEO Kwak Noh-Jung told CNBC during a groundbreaking ceremony in Indiana. 'It's really the critical issue.'

Reuters reported on Wednesday that SK Hynix is in talks with Intel to manufacture its memory chips in the U.S. for the first time. Under one scenario, SK Hynix would lease part of Intel's chipmaking facility in Ohio, Reuters reported, citing people familiar with the matter. At a Micron event in July, Commerce Secretary Howard Lutnick pushed SK Hynix and Samsung to build front-end memory fabs in the U.S. Taylor told CNBC that those decisions at Samsung are not up to him.