Saxon high-tech sector optimistic for 2024

Industry - Saxon high-tech sector optimistic for 2024

Investments at Infineon and Globalfoundries, a new building at technology group Jenoptik or the planned relocation of TSMC as a major project: "Silicon Saxony" is growing and the Saxon high-tech industry is optimistic about 2024. "We have seen constant growth for years, but now it is accelerating further," said Frank Bösenberg, Managing Director of the industry network. The situation is so dynamic that previous forecasts have even been "exceeded".

According to current estimates, the association expects around 100,000 people to be working in the industry in 2030 - from software companies to suppliers and microelectronics. In 2022, there will already be more than 76,000. 25,000 additional skilled workers will be needed over the next few years in the greater Dresden area alone as a result of the new settlements and expansions announced this year. "There is investment and construction everywhere."

The list is indeed long, with the Taiwanese chip company TSMC leading the way with plans to build a semiconductor plant in the Saxon state capital. The investment sum is around ten billion euros - half of which is to come from the federal government. There was uncertainty recently following the Federal Constitutional Court's ruling on the budget - followed by the news in mid-December that the traffic light government intends to maintain the billions in subsidies for industrial projects in the east.

Relief in the Silicon Saxony association? "We were always optimistic and never doubted the funding commitments," said Bösenberg. "Precisely because these projects are so important for the future of Germany and Europe. At the same time, Bösenberg urged speed. "The faster everything is implemented, the better."

With TSMC - the semiconductor giant's only plant in Europe - Dresden is gaining new visibility as a location in Asia and on the international market, said Bösenberg. It is also about keeping the know-how in the country. "It is fundamentally important that we can cover the entire value chain in Europe."

Economics Minister Martin Dulig also emphasized this and defended the billions in subsidies: The settlements are strategically important for Saxony and Europe, he said. They reduce dependencies on Asia and America and help to secure supply chains for domestic industry and SMEs. "Chips are the oil of the 21st century," said the SPD politician. The investments and new settlements massively strengthened Saxony as a business location.

The investment decision by TSMC, Infineon and investments in the automotive and telecommunications industries alone would result in around 30 billion euros being invested in Saxony over the next few years, explained Dulig. The majority of this would flow into the Saxon economy. "These are sums we could only dream of in the 1990s. We should all be proud of this success."

A lot is currently happening in the north of Dresden in particular: Infineon wants to invest five billion euros in the expansion of semiconductor production here. Chancellor Olaf Scholz (SPD) was present at the ground-breaking ceremony in May, and the building has since grown: the first concrete foundations were laid at the beginning of December, and around 340,000 cubic meters of earth have already been removed. Production is scheduled to start in fall 2026.

The expansion is expected to create around 1000 new jobs. In September, the company said it had already taken on 140 new apprentices in Dresden, doubling the number of trainees. "In the coming years, we want to increase the number of trainees to over 600," said a spokesperson.

Not far away, the US chip manufacturer Globalfoundries wants to expand its site. "If the market conditions are right," said a spokesperson when asked. The company did not want to give any details. According to media reports, capacity is to be roughly doubled and around eight billion dollars (7.6 billion euros) invested in the project.

The Thuringian technology group Jenoptik is also building a new high-tech factory for the semiconductor equipment industry in Dresden for around 70 million euros. The interior work is due to start in 2024 and the new production facility is scheduled to go into operation at the beginning of 2025. "We deliberately chose one of the most important locations for the semiconductor industry in Germany and Europe, where many global companies and research institutions in the industry are present," explained a spokesperson. Jenoptik intends to concentrate its production in Dresden, with around 120 employees then working in the state capital.

Even if inflation and the weakening economy are not affecting the semiconductor industry to the same extent as other branches of industry, the high energy prices are causing problems for companies. According to the industry association, renewable energies are increasingly being used and concepts for the use of hydrogen are being tested. Above all, however, it is the search for skilled workers that is driving the industry. The latest study by the German Economic Institute (IW) mentions 82,000 unfilled positions in the German chip industry.

On the one hand, training activities need to be stepped up, says Bösenberg. In addition, immigration from Europe and the rest of the world is needed. He referred, for example, to projects in India and Vietnam or an exchange program with Taiwan to attract young talent and skilled workers to Saxony.

The association sees it as an advantage that a microelectronics cluster has established itself in Dresden with employers active in various fields. If experts move to Dresden and want to change employers, they can do so without having to relocate. Bösenberg is convinced: "That is a great advantage."