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Have you noticed the cost of certain computer components seem to be less available and more expensive than it was in the past and how difficult it is to purchase the latest generation video game consoles? This is not a coincidence but instead it is the effect of a global semiconductor (aka microchip) shortage on downstream manufacturers. You will find it hard to name much new electronic devices that do not use a chip of some kind - from new major appliances to new vehicles.

Two things are the likely cause of this and both of them have to do with the Covid-19 pandemic. The first is the cut in production by many chip suppliers that slowed their factory output after implementing measures to survive the pandemic. The other is the increase in the demand for these chip-using devices, some think it is because of the increase in buying by persons in lockdown who may have extra cash to spend. This low production – high demand problem also opened the door for a new technology scalping and resale business, which is causing frustration among desperate legitimate consumers.

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The top three semiconductor-manufacturing firms in the world are TSMC of Taiwan, Samsung of South Korea, and Intel of the United States1 and while they have implemented plans to alleviate the supply-demand imbalance experts say that it may take up to two years for that to happen. Some countries are addressing this scarcity that inhibits innovation more seriously. The US President Joseph Biden said last week, “The American people should never face shortages in the goods and services they rely on...We shouldn’t have to rely on a foreign country to protect and provide for our people.” as he signed an executive order to do something about it2.


1Wikipedia, Semiconductor Industry
2Daly, J. March 9, 2021 A big little problem: How to solve the semiconductor shortage

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