The government has pledged £1 billion to develop the semiconductor industry within the UK – but critics say it’s not nearly enough.

Semiconductors are present in nearly all modern technology – everything from computers to phones and cars. In fact, so important are they that the global semiconductor shortage which arose from the Covid pandemic drove prices of a great many products up to unprecedented levels, as shortages from factory closures hit.

Now, the UK government has put up a £1 billion package of support to help develop the country’s own semiconductor industry.

However, despite this enormous sum, critics have said it’s actually not enough. They point to the fact that, despite Prime Minister Rishi Sunak asserting that he wants to turn the UK into a tech powerhouse, his investment is some way off the £50 billion each put up by the governments of Europe and the USA.

Sunak went on record to say that boosting Britain’s semiconductor industry would ” grow our economy, create new jobs and [keep the country] at the forefront of new technological breakthroughs”. However, reality bit when the UK’s largest semiconductor manufacturer, Arm, not only listed on the New York stock exchange rather than in London, but was then sold to a Japanese firm – despite calls for the government here to step in.

Tim Pullen, from British chip maker IQE, sounded a positive note, saying the investment shows the government recognises “the importance of semiconductors to the economy, to national security, and to supply chain security.”

However, others weren’t so optimistic. President of Bristol-based chip design company Picocom, Peter Claydon, told “It’s not a lot of money.” He put forward instead the need for better education to develop the next generation, as well as tax breaks for those companies already operating within the industry.

For its part, the government hopes this new scheme would not only develop world-leading technology in the shorter term but also mitigate potential supply chain issues later down the line. How it competes against other economies investing vast amounts more, though, is yet to be seen.