Business
Inside the race to train more workers in the chip-making capital of the world
Build the technology of the future. Protect the nation from attack. Buy a sports car.
These were some of the rewards of working in the semiconductor industry, 200 high school students learned at a recent daylong recruiting event for one of Taiwan’s top engineering schools.
“Taiwan doesn’t have many natural resources,” Morris Ker, the chair of the newly created microelectronics department at National Yang Ming Chiao Tung University told the students. “You are Taiwan’s high-quality ‘brain mine.’ You must not waste the intelligence given to you.”
The island of 23 million people produces nearly one-fifth of the world’s semiconductors, microchips that power just about everything — home appliances, cars, smartphones and more. Furthermore, Taiwan specializes in the smallest, most advanced processors, accounting for 69% of global production in 2022, according to the Semiconductor Industry Assn. and the Boston Consulting Group.
But a pandemic-induced chip shortage, along with rising geopolitical tensions in Asia, have highlighted the fragility of the current supply chain — and its reliance on an island under the specter of a takeover by China.
Across the U.S., Japan, South Korea, Taiwan and China, the semiconductor industry is already short hundreds of thousands of workers. In 2022, the consulting and financial services giant Deloitte estimated that semiconductor companies would need more than 1 million additional skilled workers by 2030.
Seeking to maintain Taiwan’s status as the chip-making capital of the world, the government and several corporations here helped the university — known as NYCU — create the microelectronics department last year to fast-track students into industry jobs. Now the department was recruiting its inaugural class.
Wu Min-han, 20, who sat front row with his mother, didn’t need much convincing.
He had first applied to college to major in mathematics, but dropped out after he lost interest in the subject. Then he read about the new microelectronics program and decided to apply. He’s waiting to hear.
“This department could have a pretty positive impact on my future career prospects,” he said.
Others were torn.
Lian Yu-yan, 18, said that while the new department seems impressive, she’s also interested in majoring in mechanical engineering and photonics. She hopes to find a high-paid tech job after graduating from college, but wants to keep her options open.
Her father, who accompanied her to the event, has worked in the semiconductor industry and sees high growth potential with the evolution of AI. However, that hasn’t done much to persuade his daughter.
“You can’t control Gen Z,” he said with a laugh and a shrug.
Many prospective students competing for the 65 slots in next semester’s program listed salary and job stability among their top considerations. In Taiwan, there are few industries that can compete with semiconductors on pay and prestige.
As the rise of electric vehicles, artificial intelligence and other advanced technologies demand more semiconductors, many nations are making chip self-sufficiency a top priority.
In the U.S., Europe and Asia, governments have announced more than $316 billion in tax incentives for the semiconductor industry since 2021, according to Semiconductor Industry Assn. and the Boston Consulting Group.
A May report by those organizations projected that private companies will spend an additional $2.3 trillion through 2032 to build more facilities that make semiconductors, also known as fabrication plants, or fabs.
Meanwhile, the expansion of chip-making capabilities is exacerbating another shortage: in the people trained to make them.
As the global battle for talent heats up and Taiwan loses manufacturing market share, the island has even more incentive to cultivate its next generation of workers.
Known as Taiwan’s “silicon shield,” the semiconductor industry is considered so critical to the global economy that it could deter Beijing, which lays claim to the island democracy, from launching a military assault. Taiwanese often refer to Taiwan Semiconductor Manufacturing Company, the world’s largest chipmaker and a major Apple supplier, as the “sacred mountain protecting the nation.”
In his presentation, Ker gave another example of the industry’s indispensability. When Taiwan’s worst earthquake in a quarter-century hit in April, factory workers were evacuated but quickly returned — a sign, Ker said, of the manufacturing hub’s resilience.
But to Su Xin-zheng, a second-year engineering student at NYCU, the natural disaster response was representative of the drudgery required to keep churning out so many of the world’s chips.
“People are always on call,” said Su, who added that he would prioritize having leisure time over a hefty salary. “We saw that they all went back in to protect the machines.”
Industry veterans evoke brutal hours and sacrifice when they describe how Taiwan built its semiconductor industry from the ground up. With black humor they speak, metaphorically, of ruining their livers by working through the night.
They fear that the younger generation is less inclined to such punishing work.
In particular, the growing emphasis on work-life balance is eroding interest in jobs at the fabrication plants that Taiwan and TSMC are known for.
For the past two years, labor demand in manufacturing has exceeded that of other parts of the chip-making process, such as designing the circuit boards or packaging them after they are made, according to the local recruitment platform 104 Job Bank. Engineering students enrolled at NYCU said such jobs seemed draining, with lower pay than research or design positions.
Ting Cheng-wei, 23, frequents anonymous online forums to learn more about the salaries and job descriptions at different companies. That’s how he knows that manufacturing positions, which require full-body suits to guard against contamination and 12-hour shifts on two-day rotations, don’t appeal to him.
“Working in the fab seems like working as a laborer,” said Ting, a master’s student and teaching assistant at the university. “Why would I work at a fab when I can sit in an office with higher pay?”
He speculated that job shortages at semiconductor plants could be solved by simply offering more money.
That would be enough for 19-year-old Wei Yu-han, who was ambivalent about semiconductors after her first year studying mechanical engineering. After visiting a fab on a school trip, she thought the work seemed straightforward and well-paid.
“I probably just brainwashed myself into liking it,” she said. “I can give up my freedom for money.”
At the end of the introductory seminar, all students in attendance took a short entrance exam as part of their applications. Still, enrollment in the new department is restricted by another squeeze on human resources — Ker added that the school is desperately looking to hire more semiconductor teachers as well.
Special correspondent Xin-yun Wu in Taipei contributed to this report.
Business
Insurance commissioner issues moratorium on home policy cancellations in fire zones
California Insurance Commissioner Ricardo Lara has issued a moratorium that bars insurers from canceling or non-renewing home policies in the Pacific Palisades and the San Gabriel Valley’s Eaton fire zones.
The moratorium, issued Thursday, protects homeowners living within the perimeter of the fire and in adjoining ZIP codes from losing their policies for one year, starting from when Gov. Gavin Newsom declared a state of emergency on Wednesday.
The moratoriums, provided for under state law, are typically issued after large fires and apply to all policyholders regardless of whether they have suffered a loss.
Lara also urged insurers to pause for six months any pending non-renewals or cancellations that were issued up to 90 days before Jan. 7 that were to take effect after the start of the fires — something he does not have authority to prohibit.
“I call upon all property insurance companies to halt these non-renewals and cancellations and provide essential stability for our communities, allowing consumers to focus on what’s important at the moment — their safety and recovery,” said Lara on Friday during a press conference in downtown Los Angeles.
Insurance companies in California have wide latitude to not renew home policies after they expire, though they must provide at least 75 days’ notice. However, policies in force can be canceled only for reasons such as non-payment and fraud.
Insurers have dropped hundreds of thousands of policyholders across California in recent years citing the increasing risk and severity of wind-driven wildfires attributed to climate change. The insurance department said residents living in fire zones can be subject to sudden non-renewals, prompting the need for the moratoriums.
In addition, Lara asked insurers to extend to policyholders affected by the fires time to pay their premiums that go beyond the existing 60-day grace period that is mandatory under state law.
It’s not clear how many homeowners in Pacific Palisades and elsewhere might not have had coverage, but many homeowners reported that insurers had not renewed their policies before the disaster struck. State Farm last year told the Department of Insurance it would not renew 1,626 policies in Pacific Palisades when they expired, starting last July.
Residents can visit the Department of Insurance website at insurance.ca.gov to see if their ZIP codes are included in the moratorium. They can also contact the department at (800) 927-4357 or via chat or email if they think their insurer is in violation of the law.
The Pacific Palisades fire, the most destructive fire in Los Angeles history, as of Friday morning had grown to more than 20,000 acres, burning more than 5,000 homes, businesses and other buildings. It was 6% contained.
The Eaton fire, which has burned many structures in Altadena and Pasadena, has spread to nearly 14,000 acres and was 3% contained as of early Friday. Ten people have died in the fires.
Business
In Los Angeles, Hotels Become a Refuge for Fire Evacuees
The lobby of Shutters on the Beach, the luxury oceanfront hotel in Santa Monica that is usually abuzz with tourists and entertainment professionals, had by Thursday transformed into a refuge for Los Angeles residents displaced by the raging wildfires that have ripped through thousands of acres and leveled entire neighborhoods to ash.
In the middle of one table sat something that has probably never been in the lobby of Shutters before: a portable plastic goldfish tank. “It’s my daughter’s,” said Kevin Fossee, 48. Mr. Fossee and his wife, Olivia Barth, 45, had evacuated to the hotel on Tuesday evening shortly after the fire in the Los Angeles Pacific Palisades area flared up near their home in Malibu.
Suddenly, an evacuation alert came in. Every phone in the lobby wailed at once, scaring young children who began to cry inconsolably. People put away their phones a second later when they realized it was a false alarm.
Similar scenes have been unfolding across other Los Angeles hotels as the fires spread and the number of people under evacuation orders soars above 100,000. IHG, which includes the Intercontinental, Regent and Holiday Inn chains, said 19 of its hotels across the Los Angeles and Pasadena areas were accommodating evacuees.
The Palisades fire, which has been raging since Tuesday and has become the most destructive in the history of Los Angeles, struck neighborhoods filled with mansions owned by the wealthy, as well as the homes of middle-class families who have owned them for generations. Now they all need places to stay.
Many evacuees turned to a Palisades WhatsApp group that in just a few days has grown from a few hundred to over 1,000 members. Photos, news, tips on where to evacuate, hotel discount codes and pet policies were being posted with increasing rapidity as the fires spread.
At the midcentury modern Beverly Hilton hotel, which looms over the lawns and gardens of Beverly Hills, seven miles and a world away from the ash-strewed Pacific Palisades, parking ran out on Wednesday as evacuees piled in. Guests had to park in another lot a mile south and take a shuttle back.
In the lobby of the hotel, which regularly hosts glamorous events like the recent Golden Globe Awards, guests in workout clothes wrestled with children, pets and hastily packed roll-aboards.
Many of the guests were already familiar with each other from their neighborhoods, and there was a resigned intimacy as they traded stories. “You can tell right away if someone is a fire evacuee by whether they are wearing sweats or have a dog with them,” said Sasha Young, 34, a photographer. “Everyone I’ve spoken with says the same thing: We didn’t take enough.”
The Hotel June, a boutique hotel with a 1950s hipster vibe a mile north of Los Angeles International Airport, was offering evacuees rooms for $125 per night.
“We were heading home to the Palisades from the airport when we found out about the evacuations,” said Julia Morandi, 73, a retired science educator who lives in the Palisades Highlands neighborhood. “When we checked in, they could see we were stressed, so the manager gave us drinks tickets and told us, ‘We take care of our neighbors.’”
Hotels are also assisting tourists caught up in the chaos, helping them make arrangements to fly home (as of Friday, the airport was operating normally) and waiving cancellation fees. A spokeswoman for Shutters said its guests included domestic and international tourists, but on Thursday, few could be spotted among the displaced Angelenos. The heated outdoor pool that overlooks the ocean and is usually surrounded by sunbathers was completely deserted because of the dangerous air quality.
“I think I’m one of the only tourists here,” said Pavel Francouz, 34, a hockey scout who came to Los Angeles from the Czech Republic for a meeting on Tuesday before the fires ignited.
“It’s weird to be a tourist,” he said, describing the eerily empty beaches and the hotel lobby packed with crying children, families, dogs and suitcases. “I can’t imagine what it would feel like to be these people,” he said, adding, “I’m ready to go home.”
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Business
Downtown Los Angeles Macy's is among 150 locations to close
The downtown Los Angeles Macy’s department store, situated on 7th Street and a cornerstone of retail in the area, will shut down as the company prepares to close 150 underperforming locations in an effort to revamp and modernize its business.
The iconic retail center announced this week the first 66 closures, including nine in California spanning from Sacramento to San Diego. Stores will also close in Florida, New York and Georgia, among other states. The closures are part of a broader company strategy to bolster sustainability and profitability.
Macy’s is not alone in its plan to slim down and rejuvenate sales. The retailer Kohl’s announced on Friday that it would close 27 poor performing stores by April, including 10 in California and one in the Los Angeles neighborhood of Westchester. Kohl’s will also shut down its San Bernardino e-commerce distribution center in May.
“Kohl’s continues to believe in the health and strength of its profitable store base” and will have more than 1,100 stores remaining after the closures, the company said in a statement.
Macy’s announced its plan last February to end operations at roughly 30% of its stores by 2027, following disappointing quarterly results that included a $71-million loss and nearly 2% decline in sales. The company will invest in its remaining 350 stores, which have the potential to “generate more meaningful value,” according to a release.
“We are closing underproductive Macy’s stores to allow us to focus our resources and prioritize investments in our go-forward stores, where customers are already responding positively to better product offerings and elevated service,” Chief Executive Tony Spring said in a statement. “Closing any store is never easy.”
Macy’s brick-and-mortar locations also faced a setback in January 2024, when the company announced the closures of five stores, including the location at Simi Valley Town Center. At the same time, Macy’s said it would layoff 3.5% of its workforce, equal to about 2,350 jobs.
Farther north, Walgreens announced this week that it would shutter 12 stores across San Francisco due to “increased regulatory and reimbursement pressures,” CBS News reported.
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