Semi execs feeling gloomy about 2009

70% expect workforce reductions
Seventy percent of executives surveyed in November expect their companies to decrease their global workforce in the next 12 months, including 40 percent who see a decrease of more than six percent, according to KPMG. In October, only 38 percent said they see workforce contraction at their companies, the firm said.

Twenty-eight percent of executives surveyed in November said that they expect R&D spending to increase in the next fiscal year, down from the 75 percent in KPMG's 2007 survey, the firm said. Forty-eight percent of this year's respondents said they see R&D investment falling, including 20 percent who anticipate the decrease will be in excess of 10 percent, KPMG said.

Executives did indicate that investment in so-called green semiconductor product initiatives will continue to grow over the next two to three years. Seventy-seven percent said they see their companies increasing their R&D investment in green technology, including 49 percent who see that investment increasing by more than 10 percent, KPMG said.

Seventy-six percent of respondents said their customers have extremely high interest in green semiconductor products and 54 percent estimated that green products would account for less than 20 percent of current revenue, KPMG said. But 84 percent of respondents see green products accounting for more than 20 percent of revenues in five years, according to the firm.

Despite expecting workforce contraction, 76 percent of respondents said the availability of a skilled workforce was very important in determining the allocation of capex spending, KPMG said. Over the next three years critical workforce skills are expected to be hired from several key markets, including 28 percent from the U.S., 23 percent from China, 12 percent from Korea and 11 percent from Taiwan, the firm said.

"Despite poor conditions and reduced spending, these companies need to place an emphasis on R&D in an effort to foster innovation and identify broader application markets for semiconductors," said Matuszak. "Another element of that growth investment will be targeted at ensuring a skilled workforce, which becomes increasingly important as the competition intensifies."