UK Government publishes semiconductor sector study

Following on from the publication of the UK’s National Semiconductor Strategy last year, the UK Department for Science, Innovation & Technology has published a semiconductor sector study analysing semiconductor-related economic activity in the UK. The study provides interesting statistics and insights into the current state of the industry and gives projections for the future of semiconductors in the UK. Overall, the report paints a positive outlook for the growth of the industry in the UK.

Some highlights and noteworthy details from the report are:

• The UK is a globally significant participant of the semiconductor industry, and it forms an important part of the UK economy with dedicated semiconductor companies in the UK accounting for 2% of global semiconductor revenues and generating £9.6 billion in revenues in 2022.
• Dedicated semiconductor companies employ 15,000 and may support up to a further 86,000 jobs in the UK.
• The revenue per employee ranges from £225,000 for micro-sized enterprises to £750,000 for large enterprises(!!)
• Arm stands out as the largest UK semiconductor company and is responsible for 25% of revenue and 20% of employment of the companies analysed in the study.
• Despite only approximately 5% of the UK population living in Wales, it accounts for 30% of revenue in this sector. Scotland also punches above its weight with 24% of revenue and only around 8% of the UK population. (Based on data excluding Arm).
• 90% of survey respondents expect either rapid or moderate growth in their semiconductor activity over the next 2 years, with the most optimistic sector being power electronics. Design, IP and specific materials (such as GaN) on silicon also expect strong growth.

The report describes an industry which is confident and optimistic about future growth. The report highlights some challenges, such as a perceived shortage of skills, however it also underscores the critical importance of the UK semiconductor industry for the UK economy, highlighting the need for strategic support and investment to enhance innovation and the UK’s global competitiveness.

At HLK, we are proud to be representing several of the key players in the UK semiconductor industry at start-up and corporate level. This report provides further justification to our commitment to protecting innovation in the UK semiconductor industry.