Your Guide to the Semiconductor Manufacturing Industry

The semiconductor manufacturing industry consists of a collection of companies that engage with semiconductors’ design and fabrication. The industry was formed around 1960 after it was realized that semiconductor fabrication was a viable business. Today, the industry has grown, and sales are over $481 billion, according to the 2018 record.

In the United States, invention began after the Second World War. Semiconductors have enabled the transformation of technology in the information age. With the emergence and existence of new companies, automotive and aerospace have tremendously transformed.

Many fields have continued to develop with more discoveries of unique and powerful semiconductors. Some of these fields that have had dramatic improvement include science and engineering. Some organizations have acted to help with the improvement of semiconductors; Word war II funded electronics and materials used in research and development. That has provided essential support to the continued invention and refining of semiconductors. On the other hand, the federal government played a crucial role in creating the semiconductor industry in the US.

Today, Congress provides funding to the research and development of engineering talent to support the semiconductor industry.

Types of Manufacturers

In the semiconductor chain, these are the three types of available manufacturers:

• Independent device manufacturer – is where everything will be done in-house; processing, manufacturing, and selling. The company outsources; stocking, warehousing, and distribution.

• Fabless Chip Company – similar mode of manufacturing to above independent device manufacturer. This method differs because the company has to rent some parts of the production unit.

• Pure-play foundries- these are fabrication houses used by other firms to manufacture semiconductors. However, they don’t make chips. In this type of business here, the deal will be anonymous and clients independent. The foundry company can deal with more than one company and juggle them to ensure consistent distribution.


Globally, many consumers and corporations highly use semiconductors. They are used in millions of devices, including car computers, space vehicles, medical equipment, smartphones, appliances, and more.

Electronic devices continue to proliferate, and these companies manufacturing semiconductors continue to prosper due to many reasons behind semiconductors success. The manufacturing companies have their goals; they aim to produce smaller, cheaper, and fast semiconductors. Also, these semiconductors facilitate powerful, affordable, and streamlined technology products.

Semiconductors are classified into four categories, which include:

• Commodity integrated circuits

• Memory chips

• Microprocessors

• System on a chip


The investors who are looking for exposure to this industry, they can find many companies manufacturing semiconductors. However, not all companies are known. These semiconductors will be hidden in computers, tablets, and phones. Therefore, many unknown companies play a significant role in supplying these chips and other components. After they supply to hardware companies, the hardware companies will manufacture recognizable and branded devices.

Some of the biggest semiconductor companies include:

• Intel Corp

• Taiwan semiconductor manufacturing company

• Qualcomm Inc.

• Broadcom Inc.

• Micron Technology Inc.

In a 2015 report, the industry was employing more than 181,000 workers in the United States. These workers averaged a wage of $138,100, and that doubled what other US manufacturing workers earned.

In the United States, companies have started to build semiconductor fabrication plans across the world. These companies are particularly aiming at Asia. Other semiconductor companies are focusing on “fab-less.” They are focusing on chip design. Moreover, they still depend on contact fabs located abroad to manufacture their products. On the other hand, there are many advanced fab operations globally, but many are located in Asia, especially China.

In China, the government argues that the development of semiconductor industries is a strategic priority. As they have globally competitive semiconductors, China will be self-sufficient and can supply semiconductors to other parts of the world. Some things hinder China from entering into an R&D-intensive, mature, and capital intensive industry.


Summing up, the manufacturing of semiconductors has raised national security issues. Some of these issues include access to secure and trusted suppliers of semiconductors and the supply of critical components for certain defense security and applications. The discussion will continue until the solution is found.