When the Chips are Down: Shortage of Microchips

Tried and failed to your hands on a PS5 this Christmas? You’re not the only one! With microchip shortages, many technology companies have been finding it hard to create their products, leading to massive delays.

This week, we’re covering the reasons behind the shortage and it means for the technology industry.

So, Why Is There A Computer Chip Crisis?

The adoption by Governments around the world to lockdowns meant that the majority of people were stuck at home. With nothing to do people turned to video games to pass the time which lead to increased demand. Research conducted Opinium found that “the overall UK gaming population has increased by 63%”.

The crisis was also caused by supply chains shortage from the pandemic, the trade war between the US & China, a drought on Taiwan (you need millions of liters of water in the process), and a critical chip producer burning down in March 2021.

This increase in demand meant that production companies had more orders to complete within their timeline window. Unfortunately, what happened was that not enough of the orders could be fulfilled resulting in big waiting times for restocks.

How Long Will It Last?

It’s unclear at present how long this shortage will last but if it’s anything to go by Chief Executive of Dell Technologies, Michael Dell, reckons it could last a few years. Likewise, Cisco’s CEO Chuck Robbins also believes the shortage could last for another six months. The answer is nobody knows exactly when it will end.

What Does This Mean Going Forward?

As the world still battles Covid-19 there are many challenges ahead.

The biggest being, the shortage of staff. For example, one of the biggest challenges in the UK is the shortage of delivery drivers caused by leaving the EU and with people having to self-isolate as per the UK government’s rules following the easing of the restrictions.

In the world of technology, this very issue may hinder production further.

Luckily, our industry has been somewhat unaffected by the computer chip shortage. We’re grateful that we have all the equipment we need to be able to keep helping our clients the best that we can. If you need support with a marketing project in the new year, why not contact us today?