What Is Going on With the Semiconductor Shortage?


You might have heard a lot of conflicting information about recent electronics shortages. From automobiles to graphics cards to home electronics, it’s very hard to find the most cutting-edge items right now. The newest consoles, the Xbox Series X and PlayStation 5, are sold out everywhere and nearly impossible to find. New graphics cards are the same way. Smart appliances and new cars are experiencing bizarre shortages.

Of course, some of this is related to the previous year’s myriad of issues relating to manufacturing and shipping. However, the biggest problem facing all of these electronics at once is a huge shortfall in semiconductors.

What Is a Semiconductor?

A semiconductor material has two conductive components, typically metals, that are buffered by a nonconductive medium, like most ceramics. A common semiconductor, silicone, is all but necessary in the creation of most modern-day electronics. Semiconductors play a vital role in controlling the amount of electricity that passes through a circuit board.

When a semiconductor (also known as a microchip) is created, its elements are chemically very pure. Then, impurities are added to it in a process called “doping,” which brings about huge changes in the conductivity of the material. Notably, semiconductor have an inverse property from metals: as their temperature rises, so too does their conductivity. The opposite is true of metals.

The Shortage

Early in 2020, global circumstances led auto manufacturers to greatly reduce their orders for semiconductors, as they expected to sell far fewer cars for the rest of the year. This resulted in manufacturers of the microchips to cut their production of the components drastically. Ongoing conditions in the manufacturing sector made last year a tough one for many businesses, and the production of the chips remained slow.

By the end of the year, however, demand for the chips was reaching new highs. Everything from new flagship smartphones to video game consoles requires the semiconductors, and everyone at once seemed to want to get their hands on the components. Due to the limited number of manufacturers and the bottleneck of recent events, production couldn’t match demand.

Add to that the new fascination among online communities with “scalping” electronics to flip them for a profit, and many retailers relying on online-only sales, and you’ve got a perfect storm for an ongoing shortage of electronics. While this situation will hopefully be remedied by the end of the year, in the short term it is a frustrating reminder of the interconnectivity of global markets.