Outlook of the Electronics Industry for 2023
Here we are at the beginning of January 2023; witnessing the rapid growth of the electronics industry by leveraging the latest technology advancements in fabrication processes and components design. Besides the raising graph, the industry is still facing many challenges that began in early 2020 with the onset of the COVID-19 pandemic and later continued with the war in Ukraine that has resulted in high inflation and a backlog of 2022 forecasts. Supply chain disruption, component shortage and difficulty in components sourcing, global travel limitations, and unpredicted increase in demand were the few concerns that the industry is still trying to overcome.
Today’s fast-paced, evolving environment is demanding the manufacturers to invest in key capital improvements such as plant and equipment and ERP systems that will help them prepare for tomorrow’s uncertain economy. According to the report published by the Worldwide Electronics Manufacturing Services Market 2019 Edition, the total electronics assembly value was $1.3 trillion in 2018 and is expected to grow by approximately $1.5 trillion in 2023. Fuelled by the demand for electronics manufacturing services, the contract manufacturing industry will grow from $542 billion in 2018 to $777 billion in 2023, which is a 7.5 percent CAGR.
The electronics industry also needs to be prepared for threats that will affect the growth of the sector over the coming year. Component price rises, long lead times, delayed orders and stockpiling, lack of innovation, geopolitical pressures, and new pandemic protocols have all contributed to hampering the growth of the industry in 2022, but as the global pressures have started to ease, innovation comes to the fore and we can see the fog clearing in the horizon.
Electronics manufacturing industry trends in 2023
The innovation map of the electronics manufacturing industry outlines the below global trends to boom in the coming years which in turn will improve the efficiency, durability, and sustainability of electronics products.
- Advanced Materials
- Artificial Intelligence
- Organic Electronics
- Printed Electronics
- Internet Of Things
- Embedded Systems
- 3D printing
- Miniaturized Electronics
- Immersive Technologies
- Advanced IC Packaging
- Robotics
With the above trends expected to flourish, electronics manufacturers are anticipated to put a greater focus on plant and labor in 2023. Manufacturers not only have to take a close look at their operations, their talent pool, and their financial outlook but also make smart investments in plant, machinery, research & development, automation, information technology tools, new product or service development, and business technology improvements.
Final Thoughts
Constant upgrading of knowledge and technology along with innovative ideas can be the key for electronics manufacturers to effectively plan for the future. This helps them to know what will affect the industry in the coming years as well as be prepared to adapt and overcome any potential challenges before they impact business too severely. Restricted component supply and strong demand seem likely to continue in 2023 as well as showing up signs of more modest but predictable growth.
