The chip shortage is not going away in a hurry. This is why
- Demand for chips has shot up during the pandemic. Given the hi-tech characteristics of the semiconductor industry, and its intricate and scattered supply chain, supply will take time to catch up
The global chip shortage, which began last year, has impacted a range of industries. In all, 169 industries have faced the crunch, including automobiles, computers, medical equipment and other electronic devices, according to Goldman Sachs. In most industries, and in normal circumstances, such gaps are addressed fast as businesses ramp up production and address bottlenecks. But the chip industry has its own demand and supply characteristics, which got amplified by the pandemic. As a result, the current shortages are likely to persist for a few more quarters.