Vietnam Pushes Chip
Designing
US,
Taiwan, South Korean players beat path to Vietnam though boom strains resources
·
Vietnamese
students are jumping into semiconductors, and the government has a target of training
at least 50,000 chip engineers and designers by 2030.
·
Severe
shortages of labor in traditional chip economies like
South Korea and Taiwan, as well as the U.S., mean companies are looking further
afield for engineers.
·
It primarily
focuses on high-speed data center optical connectivity,
storage, and analog and mixed-signal semiconductor technology
-- all essential for scaling up AI infrastructure.
·
U.S.-based
Synopsys, the world's top chip design tool maker, is among the most active to venture
into Vietnam, where it currently has more than 500 employees across multiple design
centers in several cities.
·
Vietnamese
engineers earn an average of $665 a month, lower than $5,627 for peers in Singapore,
$3,782 in Taiwan, $2,826 in South Korea and $1,313 in Malaysia.
·
Ho Chi
Minh City is foreign companies' top choice to attract employees due to the city's
quality of life and vibrant commercial activities.
·
Thailand
is enjoying a flurry of new printed circuit board, notebook and server investments.
·
Pegatron,
a Taiwanese supplier to Apple and Microsoft, is keen to expand the local engineering
talent pool in Vietnam, where it has been building up its manufacturing presence
since 2020.
One
student confided that he had just switched to her major; another asked her about
obscure matters like a "clock tree," a hardware design circuitry concept
-- something she had never encountered when she was a student.
A
lot has changed in the five years between Guong's graduation
and her current position as senior engineer for physical design at U.S. chip developer
Marvell. Now, fresh-faced Vietnamese students are jumping into semiconductors, and
the government has a target of training at least 50,000 chip engineers and designers
by 2030.
The
heat comes from a combination of factors. One is the surging demand for chip engineers
amid a boom in artificial intelligence. Supply chain shifts sparked by U.S.-China
tensions are also driving up demand for local talent. Meanwhile, severe shortages
of labor in traditional chip economies like South Korea
and Taiwan, as well as the U.S., mean companies are looking further afield for engineers.
Alchip Technologies, Taiwan's leading provider
of AI chip design services, is expanding its R&D team into Vietnam, where it
is planning to open its first office this year. The company is likely to increase
its headcount to up to 100 engineering staff in two to three years, CFO Daniel Wang
said.
"After
evaluating several Asian destinations for R&D team expansion, we realized that
attracting talent in established tech economies like Japan might be challenging
for [a company of] Alchip's size and scale, though we
are also expanding there," President & CEO Johnny Shen said.
"Vietnam's
promising pool of engineering talent and their strong work ethic make it a highly
attractive option for us. We've been impressed by the dedication and commitment
of Vietnamese engineers, who are eager to learn and contribute."
Also
venturing into Vietnam in search of young engineers are GUC and Faraday Technology,
affiliate chip design service providers for TSMC and UMC.
Likewise,
South Korean companies are turning to Vietnam, partly to offset a brain drain in
their home market.
Making
the grade
South
Korea's BOS Semiconductors entered Ho Chi Minh City in 2022 to set up a support
team. But as executives jetted between Vietnam and Korea, comparing the two sets
of staff, the quality of Vietnamese engineering convinced them to upgrade the team.
BOS
designs AI chips, including for autonomous driving, for automotive clients like
Hyundai. Lim said reaching one goal, that of having a system on a chip (SoC) designed
in Vietnam, would demonstrate local ingenuity.
"It
can shape the market trend," he said.
"In
Vietnam we're at the R&D stage," Quan said. "Production is really
hard and expensive, but this will put us in that direction."
BOS
compatriot ADTechnology runs two research centers in Ho Chi Minh City.
The
availability of tech workers in a time of shortage could help Vietnam achieve one
of its long-held dreams: moving up the tech value chain.
Marvell,
for example, describes Vietnam as a "strategic location for the development
of engineering talent."
Industry
veteran Le Quang Dam helped build the U.S. company's first office in the country.
From only a few dozen engineers in the first few years, his team now numbers more
than 400, up from 300 last year.
"Vietnam
will become Marvell's third-largest chip design hub, just after its headquarters
in the U.S. and India," Dam, general manager of Marvell Vietnam, told Nikkei
Asia.
Marvell
aims to increase its local headcount to about 500 by 2026. The hiring plan includes
not only staff for the offices in Ho Chi Minh City but also a new location in Da
Nang in central Vietnam.
Unlike
low-tech or labor-intensive fields, Marvell's Vietnam
operation requires advanced engineering capabilities. It
primarily focuses on high-speed data center optical connectivity, storage, and analog
and mixed-signal semiconductor technology -- all essential for scaling up AI infrastructure.
The
majority of Dam's team members are very young -- in their 20s or 30s -- and more
than 20% are female, he said. "I am still working to increase that percentage
to hire more female engineering talent."
U.S.-based Synopsys, the world's top chip
design tool maker, is among the most active to venture into Vietnam, where it currently
has more than 500 employees across multiple design centers in several cities.
A
prime example is the team's pivotal role in developing the industry's first UCIe-connected, chiplet-based test
chip, unveiled in 2023 in collaboration with Intel. UCIe,
an industry standard for advanced chip packaging connections backed by leading chipmakers
like Intel, TSMC and Samsung, is reshaping the chip industry landscape. Chiplets, or multi-die chips, meanwhile, are redefining chip
design and manufacturing, and Synopsys' Vietnam team is at the forefront of this
transformation.
Brian
Chen, a partner at KPMG Taiwan and KPMG Vietnam, said the demand for higher level
engineering skills in Vietnam is much larger than the supply, driven by the China-U.S.
tech war that has resulted in many companies shifting operations to Southeast Asia.
In
chip design, Chen said, "each company is hiring at least 300, or 500 people
for their Vietnam office."
Compared
with Taiwan or South Korea, the productivity and salary levels for engineers in
Vietnam make the country attractive for companies, Chen said, while the government's
aggressive push to make its tech economy more sophisticated has helped enlarge and
improve the candidate pool.
According
to the career resources website Salary Explorer, Vietnamese
engineers earn an average of $665 a month, lower than $5,627 for peers in Singapore,
$3,782 in Taiwan, $2,826 in South Korea and $1,313 in Malaysia.
Dam
agreed that a key driver is the trend of global supply chain diversification due
to COVID disruptions and U.S.-China tensions, which, he said, led to "many
investments shifting from China, Korea and Taiwan to Vietnam." Vietnam is also
politically stable as well as cost-effective, he said.
"It
was a challenge to find suitable space because we not only need standard offices,
we also need space for our [R&D] labs that require different power supplies
and air conditions for our equipment," Dam said, adding that infrastructure
needs to be improved.
"For
IC (integrated circuit) design, we are lucky as we don't need that much energy and
water. But for overall industry [development], power, energy and water supply is an issue. For chip packaging, assembly and testing, they require
a lot of electricity and water."
And
the benefits that are currently attracting foreign investment may not last.
Chen,
the KPMG partner, estimates that salary levels in Vietnam could soon catch up with
offerings in Taiwan due to the robust demand for workers. "The salary level
is increasing sharply. Higher-level talent will enjoy at least 10% growth in wages
each year."
Ho Chi Minh City is foreign companies' top
choice to attract employees due to the city's quality of life and vibrant commercial
activities, Chen said. "The
growth of the higher-level talent pool in Vietnam is just at its budding stage.
We foresee the companies will go to Hanoi as the next stage, when the talent market
here is saturated."
But
for now, demand for talent is still far outstripping supply -- and not only in Vietnam.
Malaysia,
a chip industry hub in the 1970s and 1980s, is pushing to rebuild its domestic industry.
Investment is flowing in from some of the biggest names in the business, but observers
point to a shortage of local engineers as one of the challenges standing in the
way of the government's dream. Thailand is enjoying a flurry
of new printed circuit board, notebook and server investments but also faces
a growing need for local tech talent.
Japan
is also attempting to regain its glory days as a chip powerhouse, and the dearth
of experienced engineers is a near-constant refrain among policymakers and industry
figures.
Other
efforts are coming from the private sector.
Pegatron
has been offering scholarships to students at the Vietnam Maritime University and
Haiphong University and sponsors school events, sports games and internship programs.
It also works with multiple universities to co-design curricula and equipment to
precisely train the workforce the tech industry needs, according to the company.
From
her desk in Ho Chi Minh City, senior engineer Guong's
career path suggests efforts like these are paying off.