News & Analysis
SEMI summit spotlights threats to electronics growth
Brian Fuller
1/15/2013 1:01 AM EST
Better clarity
John Williams, president and CEO of the Federal Reserve Bank of San Francisco, offered a slightly more upbeat outlook. He told the audience he sees U.S. gross domestic product increasing 1.75 percent in 2012 when statistics are finalized, moving to 2.5 percent this year and 3.5 percent in 2014. Unemployment will stay at or above 7 percent through the same period with a 2 percent inflation target, he predicted.
Much of the improved outlook Williams pegged to perception and expectation, and that's influenced in part, he believes, by the Fed's communications, which have become more "transparent" in recent months.
At its December meeting, the Fed adopted a benchmark-, as opposed to to time-based way to communicating its policy moves on inflation and interest rates.
"This means that the public's expectations of future monetary policy actions will naturally adjust as the economic outlook evolves, without people needing to wait for the Fed to signal a change," Williams said.
Industry analyst Bill McLean of IC Insights also offered a positive outlook for the next year (single-digit increases in revenue and unit shipments) with some caveats.
He pointed out that for semiconductor unit shipment growth, the past four years have been "probably the worst period on record." While McLean's data doesn't precede 1984, he said of the 10 worst unit-shipment growth years, four of them have been in the past five years: 2008, '09, '11 and '12. Historically the industry sees a 9 percent unit-volume growth and going forward "we're looking at 6 percent. What is the new unit-volume growth going forward?"
But he said the correlation between global economic movement and the electronics industry has never been tighter, especially as the economy picks up steam in 2014 and 2015.
"We can still get a good bounce back in this industry. There's a lot of pent-up demand for systems," McLean said.
Speaking directly of the capital-equipment industry represented here at ISS, McLean said if semiconductor demand does burst forth in 2014-15, "this industry's in trouble because we won't be able to keep up with that demand."
Related stories:
--Fab lite, fewer startups could fuel IC growth rate
--Tablet sales to outpace notebooks
--Analyze This: Electronics winners & losers in 2012
John Williams, president and CEO of the Federal Reserve Bank of San Francisco, offered a slightly more upbeat outlook. He told the audience he sees U.S. gross domestic product increasing 1.75 percent in 2012 when statistics are finalized, moving to 2.5 percent this year and 3.5 percent in 2014. Unemployment will stay at or above 7 percent through the same period with a 2 percent inflation target, he predicted.
Much of the improved outlook Williams pegged to perception and expectation, and that's influenced in part, he believes, by the Fed's communications, which have become more "transparent" in recent months.
At its December meeting, the Fed adopted a benchmark-, as opposed to to time-based way to communicating its policy moves on inflation and interest rates.
"This means that the public's expectations of future monetary policy actions will naturally adjust as the economic outlook evolves, without people needing to wait for the Fed to signal a change," Williams said.
Industry analyst Bill McLean of IC Insights also offered a positive outlook for the next year (single-digit increases in revenue and unit shipments) with some caveats.
He pointed out that for semiconductor unit shipment growth, the past four years have been "probably the worst period on record." While McLean's data doesn't precede 1984, he said of the 10 worst unit-shipment growth years, four of them have been in the past five years: 2008, '09, '11 and '12. Historically the industry sees a 9 percent unit-volume growth and going forward "we're looking at 6 percent. What is the new unit-volume growth going forward?"
But he said the correlation between global economic movement and the electronics industry has never been tighter, especially as the economy picks up steam in 2014 and 2015.
"We can still get a good bounce back in this industry. There's a lot of pent-up demand for systems," McLean said.
Speaking directly of the capital-equipment industry represented here at ISS, McLean said if semiconductor demand does burst forth in 2014-15, "this industry's in trouble because we won't be able to keep up with that demand."
Related stories:
--Fab lite, fewer startups could fuel IC growth rate
--Tablet sales to outpace notebooks
--Analyze This: Electronics winners & losers in 2012
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