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Singapore fabs serve as EE training ground

Posted: 31 May 2002 ?? ?Print Version ?Bookmark and Share

Keywords:wafer fabrication? Chengchi University? semiconductor? SSMC? Silicon-On-System?

Chen Shu Bian, an electrical engineering graduate from China's Chengchi University, is a senior equipment engineer in the Silicon-On-System Mfg. Co. wafer fabrication facility in Singapore. He's one of many savvy mainland Chinese engineers working in Singapore to fulfill their dream of working in a foreign country and getting advanced training with a multinational manufacturer. Once new skills are obtained, Chen and many other Chinese engineers plan to return home to help run the growing number of fabs being built in China.

Indeed, droves of Chinese engineers now coming to Singapore for advanced training expect to leave and return to either China or Taiwan. Only a few end up staying here. "Many of them are prepared to work in Singapore but [if] better opportunities present themselves, they are just as likely to leave," said Jason Lee, senior partner with Trapeze HR, an executive search firm based in Hong Kong.

Chen has been one of those itinerant engineers. "Although I am from China, I was originally working for a foundry in Taiwan as a junior engineer and later opted for a posting in Singapore," he said. "Singapore, I felt, provided the right environment for upgrading your skills and their rigorous on-the-job training helped me to be a senior engineer only after two years."

Lee estimated that close to 4,600 mainland Chinese have moved to Singapore since 2000, to look for better job opportunities and advanced training. Close to 20 percent, based on their qualifications, are working in the semiconductor and wafer fab industry here.

Chen's job is to improve equipment performance on the 0.18-micron line at Silicon-On-System Manufacturing Co. (SSMC) so his division meets its production goals. The wafer fab is a joint venture among Philips Semiconductor, Taiwan Semiconductor Manufacturing Co. and Singapore's Economic Development Board.

Chen said he takes great pride in his job but knows that some day he could help run one of China's slew of new wafer fabs.

Despite Singapore's best efforts to integrate Chinese engineers into its work force by offering them permanent residence status, there are few guarantees they will stay. Retaining skilled labor is still considered an uphill task in Singapore, especially since a skilled work force is seen as mobile, less dependent on geographic locations and influenced more by the desire for economic independence.

Brain drain at home?

Singapore is attracting more senior IC engineers and designers, Lee said. But it is also losing one-fifth of its own engineering work force to other regional and global markets. "We see a pattern emerging where young and enterprising Singaporeans are moving abroad instead of staying home."

China's emergence as a semiconductor power also worries industry executives here. By 2010, Gartner's Dataquest predicts, China will be the world's second-largest semiconductor market. Indeed, China's domestic market alone will consume about $24 billion worth of semiconductors by 2004. Foundry capacity also increased by 2 percent in 2001 and is expected to jump by over 12 percent by 2003, challenging Singapore for the second spot in total foundry capacity after Taiwan.

Leow Hock Bee, a research manager for Frost & Sullivan Asia Pacific, said China has already announced construction of 40 wafer fabs since last year. "The rapid developments in China in all sectors including semiconductors are resulting in some sort of a 'reverse brain drain' where mainland Chinese are returning to China," he said. "The availability of a similar quality of life and opportunities [in China] is strengthening this trend."

William Mercer Consulting said China offers employment opportunities unlike others in Asia. A report put the forecast for China's economic growth this year as high as 7.6 percent. China's membership in the World Trade Organization has also spurred foreign direct investment, including investment diverted from other Asian countries. In Beijing alone, the overall salary range for 2002 is expected to increase by 10 percent, the report said.

Singapore will be hard-pressed to hang on to the Chinese engineers it helps train. Recovering from an overall slump in its electronic exports since 2001, which badly mauled its performance in non-oil exports, Singapore too is making inroads in the chip foundry business.

The nation-state retains grand ambitions of transforming itself into an Asian wafer center second only to Taiwan. "It's an uphill job fulfilling the quota of having 25 wafer fabs in Singapore by 2005," said an official with Singapore's economic board. So far there are 15 fabs, with only two more in the pipeline. Singapore "has been overly ambitious in laying claim as the wafer hub of Asia," said Jay Marican, an investment specialist with Novertal Investment in Malaysia.

Singapore continues to attract more Chinese engineers through a recruitment program, but fewer are staying and more are heading back to China or moving to Taiwan to run new fabs. Manish Sharma, who specializes in semiconductor front- and back-end software applications, said it's becoming more common for China to attract Singaporeans than the reverse. "China fabs are attracting Singaporeans since there is a heavy demand and executive packages are all too attractive compared to working in Singapore," Sharma said.

Immigrant mix

Sharma found that immigrants make up the bulk of the engineering labor pool for back-end IC manufacturing operations in Singapore. "When I visit NEC Semiconductor and National Semiconductor I find more Malaysians and Filipinos there compared to Chinese from mainland China," he added.

Whether Taiwanese engineers running fabs here like SSMC will eventually end up in China remains unclear. Either way, more Taiwanese engineers are flocking to China rather than Singapore. "China has now realized that in order for it to develop it [must depend] on a talented work force trained in every level of running a wafer fab," Sharma said. Hence, the trek of Chinese engineers to Singapore for advanced training not available elsewhere in the region.

At the same time, China has been able to recruit more Taiwanese engineers. It is estimated that about 500,000 Taiwanese are living and working in Shanghai, while several employment agencies said about 5,000 midlevel managers are working in high-tech areas for Chinese companies in Shanghai, Beijing and Tianjin. The second half of 2001 saw Semiconductor Manufacturing International Corp. and Grace Semiconductor Manufacturing Co. hire some 3,000 engineers between them.

The benefits package China uses to attract Taiwanese engineers includes housing and a car as well as a salary beginning at $28,000, according to a recruiting agency. More than 80 percent of Taiwanese in a survey said they would like to work in China, according to 104 Job Bank, Taiwan's largest online job recruiting service.

Singapore is not the only country with a shortage of engineers. Japanese-run factories are also under pressure to double employment within China by 2004. Companies like NEC, Hitachi, Fujitsu and Toshiba are all seeking to hire more Chinese engineers. With demand growing, Chinese engineers increasingly understand they must work in a mature market like Singapore to obtain the necessary technical and managerial skills to run China's growing web of fabs.

NEC, meanwhile, is targeting China and India for skilled software engineers. It plans to boost employment in China by an additional 1,500 to 2,700. The hiring push is part of a global scheme to increase its software and service engineers from 10,000 to 60,000 engineers. Hitachi said it has saved about 30 percent on labor costs by hiring Chinese engineers instead of Japanese and plans to raise the number of Chinese systems engineers to 300 from its current pool of 160 engineers.

Despite stiff labor competition from China, Japan and Taiwan, Singapore officials said this could be offset by productivity increases created when three 300-mm fabs come on line in late 2003 and early 2004. "These companies running the 300-mm fabs have adopted an aggressive policy with regards to hiring foreign engineers," said an official from the Institute of Micro Electronics, which also helps train local engineers and students.

Chartered Semiconductor's Fab 7, operated by Au Pte Ltd., a joint venture between Advanced Micro Devices Inc. and United Microelectronics Corp. (UMC) and a UMC-Infineon Technologies joint venture, could help offset Singapore's talent drain. "Taiwan does not have as entrenched a program to train the local hardware and systems engineers," said Marican, the investment banker, while Singapore "has placed a lot of emphasis in shoring up its talent pool in the electrical and engineering sectors."

Avenue for exchange

The National University of Singapore has linked with 10 top Chinese universities to forge closer academic ties. Chong Chi Tat, university deputy president, said the alliance creates an avenue for scientific and technological exchanges between researchers and students. "Competency centers" would be set up at select Chinese universities, he said, to identify emerging information technologies of strategic interest to both countries. Prototype development projects will be encouraged.

Singapore also sends top students to study in top universities in Japan, Germany and the United States. State-supported semiconductor research is also booming here. "Singapore has realized that attracting the top designers and engineering talent is necessary if it intends to be a wafer hub, especially for the front-end semiconductor industry. And paying top dollar for talent helps to stem the brain drain, much like capital flight, especially now since the semiconductor industry plays such a vital role in its national economy," said R. Ramakrishnam, a quality control director for a manufacturing company based in Thailand.

For Chen Shu Bian, the Chinese engineer honing his skills at the SSMC fab here, a key reason for relocating to Singapore was the attraction of a higher salary and the chance to gain more experience. But with China's fab infrastructure expanding at a breakneck pace, it's unlikely he'll chose to stay.

? Tony Santiago

EE Times





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