Tech Shortages Could Extend to 2023

It has been a frustrating year for those hopeful to get their hands on some of the latest tech releases, from gaming platforms like the newest consoles from Sony and Microsoft to hardware upgrades like graphics cards, the global semiconductor shortage has led to delays in supply and a higher than ever demand. With working from home providing more freedom and individuals seeking out bigger options, particularly with the likes of gaming as those playing here have experienced some of the biggest online services, the hope had been that recovery would be seen by the end of the year and into 2022, but there are new warnings that the current tech shortages could extend far further than that. 

It’s important to understand where the shortages come from, as it’s not as simple as turning a switch on and off and meeting demand – semiconductor plants were already running at full capacity to meet the prior demand before the pandemic began in 2020, and the closure of these plants means that the chips which weren’t produced during that time have simply can’t be recovered – once the plants got started up again and production was running at full, it was running to the same demand and same supply that existed before with the backlog of product unable to be filled. 

In order for the tech shortages to “end”, the existing demand will need to slow enough that the manufacturers can build up a surplus and work from there – that’s currently why certain devices like Playstation 5’s are so hard to come by – the demand has remained extremely high, so much so that supply drops are grabbed up immediately, and no surplus of additional units can be had on hand to replenish the sales. 

The bleak outlook comes from Paul Meeks, a well-known figure running the world’s largest technology fund, and has outlined many of the same issues particularly heading into this holiday period with frustrated consumers being unable to get their hands on highly valued items – with the need for tech stocks to remain high, it’s in the interest to somewhat underplay the shortage, but the numbers don’t lie and with stock still being such a huge issue and demand remaining so high, and gave the suggestion that it’s more likely these shortages will run into 2023 and perhaps even further beyond for some specific industries with a higher reliance. 

The shortage certainly has taken a toll on the tech industry and even others that many may not have expected such as the automotive industry too, and has shown just how important some of these smaller components are for the day to day tech we use.

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