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(EDITORIAL from Korea Times on June 10)

Economy 07:08 June 10, 2022

More support for chipmaking
Time to boost competitiveness of Korean firms

President Yoon Suk-yeol has instructed his Cabinet members to map out special measures to boost the semiconductor industry and nurture talented workers. "Semiconductors are a national security asset and a mainstay of our economy, accounting for 20 percent of the total exports," Yoon said during a Cabinet meeting Tuesday.

The presidential office released a photo of Yoon viewing a photomask used for producing chips, reminiscent of U.S. President Joe Biden holding up a silicon wafer, on the sidelines of the meeting as Science Minister Lee Jong-ho gave a special lecture on semiconductors. These all show how earnestly the Yoon administration considers the semiconductor industry as being crucial for the national economy and economic security.

Yoon ordered the Ministry of Education to take steps to increase enrollment quotas for semiconductor departments. "The education (ministry) has failed to provide the talented people required for the Fourth Industrial Revolution. It should regard itself as an economic apparatus," Yoon said. He scolded the ministry for maintaining university student quotas in the greater Seoul area which serve as an impediment to nurturing semiconductor experts.

Yoon underscored the need to foster human resources to promote the chipmaking industry and increase its global competitiveness. Businesses are faced with growing setbacks due to shortages of skilled workers. According to the Ministry of Trade, Industry and Energy, chip companies will likely suffer a shortage of some 30,000 technicians in the next 10 years.

The previous Moon Jae-in administration pledged to increase the student quotas for semiconductor departments at universities in the Seoul metropolitan area. Yet it failed to keep its pledge in the face of the strict regulation on capping the total number of students. The problem has been aggravated due to the decreasing population and regulations aimed at easing the demographic and economic concentration in the capital and the surrounding Gyeonggi Province. The long-held government policy of promoting balanced regional development has also make it difficult to ease or lift the quota system.

Given this, companies have opted to set up semiconductor contract departments with major universities. Yet they have so far produced only 419 graduates from 15 universities. Worse still, their sustainability is questioned because such departments are usually set up under contracts lasting five years on average.

This situation in Korea stands in stark contrast to its rival Taiwan which has been producing some 10,000 chip specialists per year since the mid-2000s, with its universities recruiting new students twice a year. China, which is adamant in developing its semiconductor industry, is producing some 200,000 experts every year via renowned institutions such as Peking University and Tsinghua University.

It is not proper to pass the buck to the education ministry. Pan-national support is pivotal to sharpening the competitiveness of the chipmaking industry. It is also important to step up cooperation with the relevant industries producing materials and equipment. Besides, it is necessary to expand the infrastructure to supply water, electricity and land, coupled with a favorable tax system.

Yoon urged the education ministry to "bet all" to foster the chip industry. Yet, this is not enough. The Yoon administration should double down on efforts toward that end. But it should also pay more heed to the fluctuations of chip businesses which are sensitive to boom-and-bust economic cycles.

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