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If you have tried to buy a new personal computer, laptop or gaming product in the past months, you probably have come across several out-of-stock listings from your local store or on eBay, Amazon and other eCommerce retailers. Well, this is due to a biting global computer chip shortage causing significant headaches for US manufacturers and raising costs related to computer technology. Let us look at everything you need to know about computer chip shortage and how it can impact your business.
Undeniably, the COVID-19 pandemic triggered unprecedented disruption of supply chains and manufacturing across the planet. Manufacturers of computer chips in Asia were particularly hard hit. Notably, factories where chips are made experienced personnel shortages and closures dues to the pandemic making the supplies needed for chip manufacturing unavailable for months.
Additionally, as more people stayed home, demand for consumer electronics shot up, causing shifts that destabilized the supply chain. Orders began to pile even as manufacturers struggled to make enough chips to meet new levels of demand. As expected, a massive backlog began to grow, which in turn has driven up the prices of new computers and other electronics. Experts reveal the chip shortage will likely last at least two years, with normalcy expected to return not before the first half of 2023.
Computer chips or semiconductors are typically the brains of several electronic products. They are an integral component of every machine, including computers, cars, internet cables and more. Made from a conductive material, usually silicon, the computer chips enables advances in communications, computing, military systems, and countless other applications. Common types of chips include:
The US produces only 12% of the world’s computer chip supply, with 75 % of the world’s supply coming from Asia. Manufacturing computer chips is a high-volume enterprise that needs massive resources, skills and incredible precision. Plants gobble up billions to build and equip and must run 24/7 to recoup investments. But more importantly, a foundry needs massive amounts of water and electricity and is more susceptible to even the smallest of disruptions, from dust particles to distant earthquakes.
The US relies heavily on outsourcing chip-making since it’s cheaper and easier to manufacture overseas. However, with the current global chip shortage, the US government is now mulling setting up more domestic chip production plants to ramp up supply.
The severity of the global chip shortage that seems to worsen with each passing day is now impacting several local businesses and millions of people in the USA. The following are some of the immediate effects of the shortages:
As the shortage of computer chips continues, modern computer and networking parts are becoming harder to come by. The available computer products have seen their prices more than double due to low supply. If you are a business that relies on computer technology to operate, now is the best time to outsource your computer needs to a reliable Managed IT Service Provider. Relying on outdated computer equipment and legacy systems doesn’t only lead to inefficiencies, but it also exposes your organization to threats such as malware. The following are some of the benefits that come with outsourcing your computer needs:
Cushion your business from the impact of the global chip shortages with a managed IT support service from Essential solutions. We provide a range of high-quality managed IT support services that ensure access to quality technology without having to spend on expensive computing devices. Our experts are committed to delivering all or some of the IT functions your business requires, including managing IT infrastructure, running the support desk, monitoring and reporting, data backup strategy and more. Contact us today to learn more.
Essential Solutions, LLC is an IT company that relies on its strengths: customer satisfaction, quality service, and the fulfillment of our clients’ needs. Let us put our experience and expertise to work for you. Our IT solutions are an essential part of your success.