Where High-Tech Talent Is Scarce...and Help May Be a While Coming

As an industry veteran, Elvis Deng thought his new semiconductor-testing company was a sure thing. He offered faster and more efficient testing services, provided support for his customers from design to finished product, and had good relations with the manufacturers. But he didn't count on one thing: the lack of engineers. "In 1999, when the industry was booming, we found ourselves competing with other companies for skilled engineers," says the vice-president and founder of Ardentec Corp. "We couldn't find enough qualified people. Today, we still can't."

Deng isn't the only one with personnel problems. All Taiwan suffers from an acute shortage of skilled workers. The policymaking National Science Council estimates that within four years, the island's high-tech industry will need 52,000 trained people whom Taiwan doesn't have. Although the government has initiated training programs, companies are lowering their hiring standards or, worse, shifting production abroad. "We don't have much time," says Steve Hsieh, vice-chairman of the Science Council. "Our industry is already hollowing out."

Taiwanese companies such as software maker Ulead Systems Inc. find themselves with little choice but to relocate research and development. "I can't find engineers in Taiwan," says Chairman Chen Way-zen, gesturing at the empty cubicles filling half of the fifth floor in his uptown building. Ulead's overseas payroll will increase sevenfold in 2002, with half of the R&D growth in China.

Even the two giant made-to-order chipmakers, Taiwan Semiconductor Manufacturing Co. and United Microelectronics Corp., are feeling the labor squeeze. And with 2,000 engineers between them, TSMC and UMC swallow more than 15% of the local pool of engineers, forcing smaller companies, such as Deng's, to join the migration. The alternative, training unskilled personnel, is an option for larger outfits with deeper pockets. Ulead focuses on finding smart recruits rather than ones with engineering degrees. It then spends five months to train them in software development. "The only way we can get quality people is to train them ourselves," says Chen.

Although the government has set aside $300 million for training, industrialists such as Stan Shih have taken matters into their own hands. The Acer Group chairman created Aspire Academy to offer the wisdom of his 24 years as head of one of the world's top notebook makers. In addition to the main campus near Hsinchu science park, Shih also licenses his training course to five Taiwan universities as well as offering an "e-pack" online training course. "Taiwan must develop new knowledge bases and workers," he says, leaning forward with a look of intensity. "We have no choice."

Even high-tech academies, however, won't do the trick. Education needs run much deeper in Taiwan, where less than 30% of the population has finished high school. That's why a group of top scholars has taken the challenge of establishing a community college system. It first took form in 1999 with the founding of two municipally funded schools in Taipei to offer higher education courses to those without the means of going to high school or college.

By the end of this year, 31 schools around the island will be offering courses. Classes all take place at night in local junior high and senior high schools and are frequented mainly by those 25 to 40. Although none of the schools offers advanced technical training, they do teach basic computer programming--as well as mathematical history, the philosophy of phenomenology, and flamenco dancing, among other subjects. "This is a bottom-up reform with aims to liberalize society and level the playing field of educational opportunity," says co-founder Chang Chang-I, National Taiwan University geology professor.

The schools are still in their infancy, offering only a certificate of completion for each course. Chang says he's working with the Education Ministry to design a 120-credit requirement system that would give students a university degree. The colleges don't claim to be turning out biotech engineers, but they are giving people an opportunity to get the fundamentals--and maybe even move on to Acer's academy.

By Macabe Keliher in Taipei

Edited by Harry Maurer

    Before it's here, it's on the Bloomberg Terminal.