Semiconductor companies stand out

Latest update time：2024-02-09

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Source : Content compiled from CNBC by Semiconductor Industry Observer (ID: icbank ) , thank you.

Chip stocks had a strong showing on the stock market last year, with their rapid gains outpacing the FAANG and other tech industry leaders, fueled by enthusiasm for advanced artificial intelligence chips. This success has now been transferred to another measure of corporate performance. Semiconductor companies outpaced FAANG stocks in Just Capital's annual ranking of publicly important U.S. companies, with Intel, Advanced Micro Devices and Micron Technology all in the top 10.

In contrast, although Apple, Microsoft and Alphabet continue to be on the list, their relative rankings have declined compared with previous years, with only Apple entering the top 20 in 2024.

Several other chip companies also made jumps in the JUST 100 rankings: ON Semiconductor climbed 235 spots to No. 89, while Nvidia, Qualcomm, Lam Research, Applied Materials and Cirrus Logic are all on the list.

Just Capital is a not-for-profit research firm founded by hedge fund billionaire Paul Tudor Jones that identifies large public companies that excel in stakeholder capitalism, Martin Whitt Martin Whittaker, founding chief executive of MIT, said each year "one or two industries will stand out for the work they do in driving progress for wider society". This year, it's clear that semiconductors as a whole are forging a path forward. "

Semiconductor companies rank high on this year's JUST 100 list not only because of the number of jobs they create relative to other industries, "but also because they adopt and expand policies that support workers and communities," Whittaker said.

AMD, for example, climbed 119 spots to rank ninth on this year's list, largely due to the company's performance in the Communities, Workers and Customers section of the rankings. According to Just Capital, the company is tied for first among the entire Russell 1000 index in local job creation and spent $14.9 million with diverse suppliers such as women, minority and veteran-owned businesses, a significant boost. community stakeholder scores. AMD also improved employee scores by disclosing minimum annual salaries for the first time and providing more information about career development and benefits. Regarding AMD's customer ratings, Just Capital said the company added disclosure to its privacy policy about users' ability to delete or modify their personal data and disclosed that no data breaches occurred in the previous reporting year.

Other semiconductor companies also made progress in these categories, ranking higher.

Intel provides new transparency around salary ranges and company demographics, funds educational opportunities and programs, and enhances employee benefits, including 15 days of paid time off, 12 weeks of paid parental leave for primary and secondary caregivers, and Subsidize dependent care. Micron has multiple career development programs, allowing each employee to receive an average of 62 hours of training, and conducts pay equity analysis based on gender and race to ensure pay equity.

In the JUST 100 poll, worker issues continue to rise in importance, accounting for approximately 42% of survey methodology. In particular, “paying a fair and living wage” was the top issue in this category, along with career advancement opportunities, worker training, and development, benefits and retention. Hewlett Packard Enterprise topped the list this year in large part because of its focus on these categories.

The growing benefits for workers at semiconductor companies come as the Biden administration introduces the $52 billion Chip and Science Act, which aims to make the United States more competitive with China by promoting domestic semiconductor manufacturing and scientific research.

The bill, signed in August 2022, has led to companies announcing more than $40 billion in new semiconductor manufacturing investments in the United States, according to the U.S. government. However, as these investments increase, so do the talent gaps for qualified workers in key manufacturing positions at these companies. TSMC, the world's largest chip foundry, has had to postpone production at its $40 billion Arizona factory due to a lack of workers in the United States.

"We are still looking across the board for more qualified skilled workers," TSMC Arizona president Brian Harrison told CNBC's Kristina Partsinevelos in August. "We are installing equipment that is unique to the United States and extremely advanced."

TSMC has previously said it will bring in workers from Taiwan to operate high-tech equipment and train American workers.

"[American workers] just don't have experience with these specific tools and techniques," Harrison told Partsinevelos.

The U.S. chip industry is expected to add nearly 115,000 jobs by 2030, according to a study by Oxford Economics and the Semiconductor Industry Association. The study found that 67,000 of these technician, computer scientist and engineer positions could go unfilled by 2030 due to a lack of education training programs and school funding.

Michael Schmidt, director of the CHIPS Program Office, told CNBC CEO Council members at a members-only virtual event in October that the U.S. government’s focus on the industry has helped increase visibility and encourage college students to switch to Semiconductor manufacturing, not other technology field jobs. He also noted that CHIPS Act funding is earmarked for worker development.

Since the passage of the CHIPS Act last August, more than 50 community colleges have announced new or expanded semiconductor workforce programs, and many of the chip companies are partnering with local middle schools, high schools, community colleges and universities.

While there is no direct link between the passage of the CHIPS Act and the rise of semiconductor companies in the JUST 100 rankings, the apparent war for talent emerging in the industry means worker issues will remain high on these companies' priority lists.

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https://www.cnbc.com/amp/2024/02/08/booming-chip-stocks-just-earned-one-more-market-leadership-honor.html

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