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Yoshida in Japan: Renesas' cuts are GloFo's gain
Junko Yoshida
2/14/2013 3:01 AM EST
Word of layoffs is depressing and heart-wrenching, especially so when it takes place on the massive scale that hit workers at Renesas Electronics.
Last fall, close to 7,500 employees (7,446 to be exact) --aged 40 and above–took the early retirement package. The ailing Japanese chipmaker last month announced further cuts, with plans to eliminate another 3,000 jobs.
Conventional wisdom dictates that many of those thousands of people may not be able to find another full-time job ever again, despite their lifetime dedication to the company.
Think again. The key word missing in the sentence above is, “in Japan.”
At least hundreds, if not thousands, of skilled semiconductor engineers who are retiring early from Renesas will end up working for chip companies outside Japan.
As word on the street in Tokyo goes, GlobalFoundries turns out to be one of several astute companies aggressively pursuing skilled Japanese engineering professionals. They’re keeping a close eye on the Renesas exodus.
Since breaking ground on Fab 8 in Saratoga, NY., GlobalFoundries has hired just over 2,000 people in New York state. The company expects that to increase to about 3,000 by the end of 2014. About 90 percent of the company’s New York workforce is composed of people in technical and operations roles. Asked about hiring Japanese engineers, a company spokesman noted, “We definitely hired some skilled professionals from Japan, but I can’t provide details of numbers or percentages.”
Thirty-five Japanese engineers have already been hired by GlobalFoundries’ regional office in Japan, according to an industry source based in Tokyo, who spoke on condition of anonymity. These engineers are getting prepped to be sent to New York as an initial batch, with as many as another 100 to 200 to follow, the source said.
Last fall, close to 7,500 employees (7,446 to be exact) --aged 40 and above–took the early retirement package. The ailing Japanese chipmaker last month announced further cuts, with plans to eliminate another 3,000 jobs.
Conventional wisdom dictates that many of those thousands of people may not be able to find another full-time job ever again, despite their lifetime dedication to the company.
Think again. The key word missing in the sentence above is, “in Japan.”
At least hundreds, if not thousands, of skilled semiconductor engineers who are retiring early from Renesas will end up working for chip companies outside Japan.
As word on the street in Tokyo goes, GlobalFoundries turns out to be one of several astute companies aggressively pursuing skilled Japanese engineering professionals. They’re keeping a close eye on the Renesas exodus.
Since breaking ground on Fab 8 in Saratoga, NY., GlobalFoundries has hired just over 2,000 people in New York state. The company expects that to increase to about 3,000 by the end of 2014. About 90 percent of the company’s New York workforce is composed of people in technical and operations roles. Asked about hiring Japanese engineers, a company spokesman noted, “We definitely hired some skilled professionals from Japan, but I can’t provide details of numbers or percentages.”
Thirty-five Japanese engineers have already been hired by GlobalFoundries’ regional office in Japan, according to an industry source based in Tokyo, who spoke on condition of anonymity. These engineers are getting prepped to be sent to New York as an initial batch, with as many as another 100 to 200 to follow, the source said.
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eewiz
2/15/2013 1:38 AM EST
"No official data has been released about how many Japanese semiconductor engineers have already left their employers and are currently working at non-Japanese companies in South Korea, Taiwan or in China. Some suspect that there are many."
I would love to see the data if any. But I suspect there arent many. Over the past few years I guess atleast 100K people would have been displaced from their jobs in semi/CE sector. The few 100's hired by GloFo is probably only a very small % of the displaced workers. In addition,based on my experience of working for a semi company in Japan, most semi engineers doesnt speak English, which is also a major hurdle for relocation.
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junko.yoshida
2/15/2013 8:17 AM EST
You are absolutely right. If you're talking about percentage, it's probably negligible.
But think about Major League Baseball. 20 years ago, only Nomo and a few other Japanese players were playing in the US. It's still a small percentage but more Japanese ball players are visible in the US today.
Unlike Chinese, Japanese never had a diaspora. But you may start seeing more skilled Japanese semi professionals soon outside Japan.
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joshxdr
2/17/2013 1:32 PM EST
It is not technically true that there is no Japanese diaspora in the US. I think what you mean is "there is no established Japanese community" in most US cities.
http://en.wikipedia.org/wiki/Japanese_diaspora#Americas
"The Japanese diaspora has been unique in the absence of new emigration flows in the second half of the 20th century"
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iniewski
2/15/2013 10:50 AM EST
What kind of pension you get for forced retirements at the age of 40+ in Japan? Perhaps this is not as bad as it sounds...lots of free time to pursue other interests in life
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junko.yoshida
2/15/2013 12:09 PM EST
iniewski, that's a good question. The rumor I heard, but not confirmed, is that if you are a professional engineer currently paid $100K, you get $100K for retirement money + $200K as an incentive for early retirement.
That, indeed, ain't bad at all.
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DMcCunney
2/16/2013 2:04 PM EST
And that lasts how long, given costs of living in Japan?
It's not bad if you have decent prospects of finding another job. With the semi industry shrinking in Japan, finding another job may require relocating. But relocating where?
Will places like Taiwan and Korea have openings for displaced Japanese engineers (especially since they have their own pool of engineering talent, and will give preference to a local)?
I think a lot of these folks just won't *get* new jobs.
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GQQSER2
2/15/2013 12:00 PM EST
"These engineers are getting prepped to be sent to New York as an initial batch, with as many as another 100 to 200 to follow, the source said."
Sounds almost like we're talking about products instead of people.
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docdivakar
2/15/2013 12:37 PM EST
@Junko & @iniewski: I have mixed feelings about this outcome of a country losing its well-experienced and competent workforce to globalization.
If Renesas were to be a pure digital play chip company, I would have said may be it is for the good since the number of fabs / IDM's at advanced technology nodes are rapidly shrinking to a handful (soon we will be counting with one hand the fabs /IDM's for 14nm and beyond!). But this wasn't the case -Renesas has / had many analog and mixed signal products, products that don't need the latest nm node. There is plenty of innovation left in these. It also boggles me that Renesas never made serious attempts to play in MEMS market where much of the talented workforce could have been re-purposed.
From the perspective of globalized economy, repercussions from workforce exodus is not exactly a zero sum game, though GloFlo stands to gain but that is not linear. Moreover, there are ample examples of macroeconomic ecosystems stemming from expats' money flow that spurs different industries and opportunities. In this regard, Japan has a lot to learn from countries like India where workers of migrated overseas in all cadres yet stimulate a vibrant economy back home.
MP Divakar
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joshxdr
2/17/2013 1:22 PM EST
I think it would be tough for a Japanese engineer to relocate to a GF fab in upstate New York. There is no established Japanese communinity in that area. Non-English speaking spouses would be socially isolated and unemployable. There are no Japanese schools. Due to the reliance of Japanese education on high-stakes testing, a Japanese kid who goes to an American school will be behind when returning to Japan. It is possible but difficult to live on a Japanese diet in the US, and it would be more difficult in upstate NY. As much as the Japanese economy has deteriorated, I think Japan still has a higher standard of living than Taiwan or South Korea. I would guess that the fraction of Japanese engineers with sufficient English proficiency to work in the US to be 50% or less. I think it is very unlikely that there will be a flood of engineers from Japan even as grim as things are.
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docdivakar
2/17/2013 1:49 PM EST
@joshxdr: what you bring up as difficulties for Japanese professionals to move overseas are the same ones that other Asian ethnicity went thru when migrating to US/EU destinations. The gist of my message above is that in today's globalized economy, the opportunities will not always be in one's home turf! It would seem that the Japanese have more reluctance to accept this -could be reluctance, anxiety of assimilating/adapting to culture that is foreign to them, etc.
It is never too late to start a 'Little Tokyo' in upstate NY!
MP Divakar
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RickMatz
2/19/2013 11:04 AM EST
There aren't American engineers qualified for those jobs?
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junko.yoshida
2/19/2013 3:45 PM EST
I am sure there are. But then, how many U.S. chip companies actually are "fabbing" chips these days -- besides Intel?
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Jim-Bell
2/25/2013 10:07 PM EST
Fairchild, IR, Linear Tech, Maxim, TI, and many more (besides Intel) are actually "fabbing" chips those days and these days.
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RickMatz
2/20/2013 2:31 PM EST
There's one in NY.
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truekop
2/26/2013 12:15 AM EST
Adding ADI and Triquint, are fabbing from time immemorial....
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