Engineers from Taiwan exit from chip industry in China
TAIPEI, Taiwan — The job offer from a Chinese semiconductor company was appealing. A higher salary. Work trips to explore new technologies.
No matter that it would be less prestigious for Kevin Li than his job in Taiwan at one of the world’s top chipmakers. Li moved to northeast China in 2018, part of a wave of corporate migration as the Chinese government moved to build up its semiconductor industry.
He went back to Taiwan after two years, as COVID19 swept through China and global tensions intensified. Other highly skilled Taiwanese engineers are going home too.
For many, the strict pandemic measures have been tiresome. Geopolitics has made the job more fraught, with China increasingly vocal about staking its claim on Taiwan, a self-ruled democracy. The Taiwanese government has begun to discourage local engineers from going to China, concerned that they were taking proprietary information with them.
“Some who went to work in China were villains who exchanged secrets for money,” said Li, 40. “Some wanted to be free from the work pressures in Taiwan. And there were those who seriously wanted to explore new areas.”
The prospects that enticed Taiwanese engineering talent to China, feeding a pipeline for lagging Chinese semiconductor companies hoping to compete with global rivals, are rapidly diminishing.
Semiconductors are vital strategic assets in the pitched geopolitical rivalry between the United States and China. As Washington tries to crimp China’s capacity to make advanced
chips, Taiwan, the world’s biggest producer of highend semiconductors, finds itself at the center of what some are calling the 21st century’s version of the arms race.
Sweeping bans imposed by the Biden administration in October targeting China’s chip industry have put the island’s premier chipmaker, Taiwan Semiconductor Manufacturing Co., on the frontline of likely disruptions to the global supply chain. Adding to the pressure, the Biden administration has pressed TSMC into building a plant in Arizona to help diversify the United States’ sources of chips.
Beijing has blasted the new rules, saying they “will not only harm Chinese companies’ legitimate rights and interests but also hurt the interests of U.S. companies.” And the Chinese government, which is pushing its own strategy of self-reliance in key areas like semiconductors, is expected to retaliate in ways that could punish TSMC.
So far, TSMC said, the effect of the new rules has been limited. The administration granted a one-year waiver to the company, allowing it to continue
expanding its facility in the Chinese city of Nanjing. TSMC also has a plant in Shanghai.
But Washington has barred Chinese and Taiwanese engineers with U.S. citizenship or a green card from working in China’s chipmaking facilities. The ban will force about 200 Chinese and Taiwanese engineers to either leave China or give up their U.S. citizenship, Hsu said.
“This has such a chilling effect on every Taiwanese national working in the semiconductor industry in China. Everyone is on edge,” Hsu said. “What if a U.S. government intelligence agency thinks you are violating U.S. security and wants to arrest you?”
For years, China poached Taiwan’s semiconductor engineers, who often have doctorates and are essential to keeping the world’s most advanced chipmaking factories humming.
In 2019, about 3,000 Taiwanese semiconductor engineers were working in China, nearly 10% percent of the 40,000 engineers at the heart of the industry’s workforce, according to the Taiwan Institute of Economic Research, an independent group.