The Labor Department has a partner in developing a talent pipeline for the semiconductor industry. For details, the Federal Drive with Tom Temin spoke with the President of the National Institute for Innovation and Technology, Mike Russo.

Interview Transcript: 

Tom Temin And before we get into the semiconductor talent pipeline, as the Labor Department, I guess, is part of this whole CHIPS act deal. Maybe tell us a little bit more about the Institute itself. What do you do there and how does it work?

Mike Russo Yeah. So we have the institute. We’re a Hanover, Maryland based 501 C3. Really our main focus is to develop and now execute, because we’ve already developed the strategy, to build the nation’s talent pipeline to support strategic industry sectors. So think of tech based industries and advanced manufacturing, they’re tied to national security and global competitiveness. So that’s our main focus at the institute. You did mention our partnership with the U.S. Department of Labor. We’re under contract with the department to expand and establish registered apprenticeship programs throughout the semiconductor and broader nanotechnology supply chain. So that’s what we do in partnership with the Department of Labor.

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Tom Temin So the talent that you’re looking at in the pipelines and the apprenticeships then are not necessarily the MIT engineering graduates who know how to design circuitry using high tech tools. But there’s a lot of craft type jobs and FAB operations jobs that the United States will need. Is that the general area we’re operating in here?

Mike Russo Yeah, we heavily focus on technician jobs of all levels and disciplines, but we also go up into the entry level engineering positions, and we even help engineers that come directly from universities to acclimate themselves to the industry where they might not have specific industry experience. But the major focus is really broadening the pipeline, getting more people access to the industry and this strategic energy, its not just the semiconductor industry. And really it was technician jobs.

Tom Temin And what is the industry itself doing? Because at one time, most of the semiconductors were made in the United States, and now they’re not. We still make a lot of them. We still have FABs in this country. But what’s the fundamental issue that there is a shortage of talent or people don’t realize what’s available to them in these types of jobs?

Mike Russo Yeah, I think there’s been an increasing disconnect through the years with what people learn through the public education system and an understanding of what is really needed and what really high value jobs are available, and how to leverage a public education system to get into those jobs. The other thing that’s happened in recent years is just the rising costs of college education in general, and the lack of ability of a majority of the population to really take advantage of that route. When I was growing up, you aspired to go to college and you would get your job right. It’s not quite that simple anymore. So we look at everything really a balance between supply, the individuals that have an awareness and are motivated to pursue these higher value careers and then the capacity of the system to train and educate at the right level, and the demand of the employers to actually receive them coming from those types of pathways.

Tom Temin Is the fact that because of federal government action, the trade schools have pretty much disappeared. Is that a factor also in this labor gap?

Mike Russo Yeah. It’s not just the federal government. And you talk about trade schools in general. You think about back in the day, you had shop courses in public education, they’ve sort of disappeared. People don’t use their hands as much anymore. And it’s not just the federal government. You go into the labor union, they used to be big in manufacturing. I remember there used to be an industrial division like of the AfL-CIO back in the day, and that disappeared. Everything was focused on, service industries and let commodity manufacturing and manufacturing go overseas. That was okay for a couple of decades. And now I think there’s an awakening of the importance of manufacturing to innovate and the strategic importance of manufacturing and how manufacturing in general is much more advanced.

Tom Temin We’re speaking with Mike Russo, president and chairman of the National Institute for Innovation and Technology. And tell us more about what you’re doing with the Labor Department and how the Labor Department is connected to the semiconductor industry and what the pipeline looks like.

Mike Russo The Labor Department, a few years back, go back to say a decade ago, a vast majority of registered apprenticeships were hours based apprenticeships focused on the trades, meaning electricians and carpenters and, plumbers and steam fitters, etc.. In more recent years, there’s been an interest in moving that model to really address and really open up opportunities to a broader population, to these more advanced manufacturing jobs such as the semiconductor industry. And when the Biden administration took over, they decided to really move more aggressively and leverage registered apprenticeships for advanced manufacturing and specifically the semiconductor nanotechnology. There were really no apprenticeships tailored to those industries up until a couple of years ago. And so back in late 2021 and really into 2022, there was an RFP to advance registered apprenticeships geared towards those types of industries. So we were awarded that contract and we’ve been at it since 2022. And it’s really focused on instead of hours base building trades, it’s more competency based. So targeting the training to fill the gaps and what you need to know to be proficient in various technician jobs. And since the onset of that program, we’re in 17 states. We have about 85 programs. We have about probably close to 5,000 people committed to our programs apprentices. We have about 50 community colleges across the country providing them related technical instruction needed. And then we have a very unique system, called a national talent Hub, that we developed in partnership with the National Science Foundation to really align curriculum in real time to support the training. So that’s all relatively new in the last couple of years.

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Tom Temin In the semiconductor industry. And again, this is an important national concern because of the CHIPS act and so forth. And there’s a ban coming in place for the government in three years to buy any semiconductors or buy any subsystems with CHIPS from China, Russia, Iran, if they make any, they’re, and North Korea if they make any there. And so the U.S. capacity needs to be built up. Any estimation of the demand that will be there for the trade and craft types or shift types of jobs, as opposed to maybe the advanced engineers.

Mike Russo If you think about the estimates on current workforce versus what it will look like in 2027 or say by the end of the decade, the estimates, there’s about 277,000 workers throughout the semiconductor industry, and it supports a broader, probably 1.6 million additional jobs. And by the end of the decade, they’re projecting that to go to about 319,000 industry jobs and moving the total number to about 2.13. And it doesn’t sound like a lot, but if you look at in terms of the industry, they’re projecting about 70,000, shortfall of about 70,000 workers. So 70,000 scattered throughout fabs around the country as we build them is a major problem. And the other thing that people aren’t really factoring in is that the anticipated loss of people, people that leave. So I think that number could actually be much bigger. And again, we are focused on deploying a national strategy to address that, which we could talk about in more detail, but it could be a real problem.

 

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