SANTA CLARA, Calif. — Research firm Integrated Circuit Engineering Corp. (Scottsdale, Ariz.) released its latest prediction that chip revenues worldwide will decline by 12 percent or more in 1998, to $121 billion, and will remain "essentially flat" during 1999.

Even unit shipments of semiconductors will be down roughly 5 percent, ICE predicted. In fact, semiconductor unit shipments in the past 12 months have fallen 5.6 percent from a year ago, said Bill Groves, vice president of ICE.

"You can always point to DRAMs and say revenues are in the tank but units are up," Groves said, but it appears shipments of other products have also begun to decline.

ICE hasn't isolated the culprits, but it's likely that older parts are "taking a bath," Groves said. Microprocessor and microcontroller demand might have softened as well, partly due to slack PC demand in Asia. "I've heard several reports of them [PC sales] starting to tail off in Asia Pacific," he said.

Citing continued weakness in Asia and the PC market, National Semiconductor Corp. was the latest semiconductor company to announce a furlough. Intel Corp. shut down two of its Oregon plants for nine days in July, sending 1,700 workers home without pay. And many capital-equipment companies, including Applied Materials Inc. and Novellus Systems Inc., closed for a week around the Fourth of July.

National employees were notified in June that they would be required to take 10 days of paid vacation or unpaid time off during National's second quarter, which begins in September. National will not shut down per se, as the company's 13,000 employees will choose their own days off, a spokeswoman said.

National's move follows a 1,400-employee layoff announced in April