The global electronics industry is navigating one of its most complex operating environments in recent memory. Five forces are converging simultaneously: geopolitical conflict, energy market disruption, semiconductor supply concentration, trade realignment, and a growing productivity imperative. And yet, at the headline level, the industry is holding up remarkably well. 

That resilience, however, masks a more uneven picture, one worth examining closely. 

AI Is Squeezing the Memory Market 

The Global Electronics Association's Memory Squeeze report identifies a challenge that is becoming hard to ignore. AI infrastructure is consuming semiconductor resources, memory in particular, at a rate that is driving real price pressure across the supply chain. GEA member sentiment confirms it. Costs are up, even if availability has not yet deteriorated to crisis levels. 

The deeper issue is structural. The global semiconductor supply chain runs through a remarkably small number of companies and geographies. Taiwan's export data makes that plain, with electronics now dominating its export profile. That concentration was always a latent risk. In the current geopolitical environment, it is an active one. For EMS companies and OEMs, the message is straightforward: semiconductor availability cannot be taken for granted, and procurement strategies need to reflect that. 

Energy Costs Are Stickier Than Markets Expect 

The Iran War and its impact on the Strait of Hormuz has introduced an energy cost shock that is broader and more durable than consensus forecasts suggest. Futures markets are already pricing oil at least ten dollars a barrel above pre-pandemic levels through 2026 and into 2027. Shipping costs are up. Insurance is rising. Input materials are more expensive. All of it feeds directly into the cost of manufacturing. 

European producers face the sharpest exposure, having already identified energy costs as a competitiveness concern before the conflict began. The key risk is that markets, eager for resolution, are systematically underpricing the downside. A prolonged conflict means prolonged inflationary pressure, and manufacturers not planning for that are carrying risk they may not have fully accounted for. 

A Two-Category Market 

Despite all of this, electronics output is defying expectations. US production is at or near all-time highs in several series. Asian exports remain strong. Book-to-bill ratios for PCB and EMS are showing positive momentum. 

The explanation is a two-category story. AI infrastructure investment and defence spending are carrying the market, both largely insulated from the consumer dynamics that would normally translate energy shocks into reduced output. Outside those categories, the picture is different. When households are spending an extra forty to eighty dollars a month on fuel, discretionary electronics purchases are an obvious casualty. Manufacturers with significant consumer electronics exposure need to plan accordingly. 

Supply Chain Shifts Don't Reverse 

What began as tactical tariff workarounds has become genuine strategic reconfiguration. Companies are no longer just asking where to manufacture to cut near-term costs. They are asking where to manufacture to build long-term resilience. That momentum does not reverse easily. 

For EMS companies, the practical implication goes beyond having capacity in multiple geographies. It is about building the operational muscle to use that footprint dynamically, qualifying lines in more than one location, and developing the programme management capability to move work fluidly when circumstances demand it. 

Data as Competitive Advantage 

Underlying all of these trends is a need for better, faster, more granular intelligence. The Global Electronics Association is building toward exactly that, with European data acquisitions, new regional offices, and further announcements imminent. The goal is to move beyond macro sentiment reports to insight specific enough to inform individual company strategy. 

The industry is not in crisis. But it is in transformation. The manufacturers investing in intelligence, agility, and operational resilience will be the ones who look back on this period as an inflection point. 

Philip Stoten is a journalist, speaker and host specialising in the global electronics manufacturing services industry. He hosts the EMS@C-Level, EMS & The Economist, and MADE IN EUROPE podcasts. 

Shawn DuBravac is Chief Economist at the Global Electronics Association. 

This feature is based on the most recent episode of EMS & The Economist which is available in video format on YouTube and in audio format by searching for EMS@C-Level wherever you get your podcasts. 

The U.S. Department of Energy has announced a Notice of Funding Opportunity (NOFO) of up to $69 million for innovative processing technologies that can ensure a more secure and affordable supply of critical minerals and materials (CMMs) foundational to energy, security, and industrial competitiveness. Elements like silicon, gallium, and neodymium are important to electronics and they are also deemed critical. This NOFO aims to direct funding to accelerate industry-led partnerships to prototype and pilot technologies that will, in part, ensure the recovery, refining, and production of CMMs from post-industrial and post-consumer scrap, like waste electrical and electronic equipment, known as e-waste. 

E-waste is a materials problem that engineers shouldn’t ignore. This NOFO makes a blunt point that should matter to everyone responsible for designing electronic systems: today, we are quietly bleeding CMMs out of U.S. supply chains at end-of-life. Nearly all CMMs in e-waste are lost! Across the U.S. e-waste value chain, only about 2% of CMMs are recovered domestically. The rest are removed from the domestic value chain with about 44% exported and about 54% landfilled before they can be recovered, refined, and reintroduced into manufacturing. 

What’s striking is how explicitly this NOFO reframes e-waste as a resource and not a waste. Rather than positioning it as an environmental liability, the U.S. DOE treats e-waste as a resource like virgin raw materials from mines. E-waste can be mined domestically. Electronics-heavy systems like electric drivetrains and power electronics become future CMM inventories. Recovering these materials is functionally equivalent to expanding domestic production capacity, without having to locate and open a new mine. Rare earth magnets, aluminum, copper, and other CMMs essential to clean energy technologies and future electronics innovations are essentially at-the-ready if we can expand domestic production capacity from our stock of e-waste. 

While this funding opportunity considers many CMM recovery technology solutions, its implications land squarely upstream, at the design stage. Today’s losses are downstream consequences of upstream design decisions. Adhesives, mixed alloys, plastics, and highly integrated assemblies can defeat disassembly, materials separation, and recovery. As a result, shredding of e-waste becomes the dominant management technique.  

Fixing upstream failures is critical to unlocking downstream potential. Designing for recovery – or designing for circularity to include recyclability, repurposing, remanufacturing – is a supply chain issue, not just a sustainability “nice to have.” When does losing valuable materials make sense? Let’s design electronics with the end-of-life in mind. 

This NOFO underscores the opportunity for industry to play a leading role in advancing scalable technologies for critical mineral and material recovery from electronics. While the Global Electronics Association is not pursuing participation in this specific funding opportunity, we remain highly interested in engaging with companies and consortia working in this space. We encourage organizations developing relevant recovery, refining, and circular design technologies to connect with us to explore collaboration on future DOE funding opportunities and broader initiatives focused on strengthening domestic CMM recovery from electronics. 

During National Apprenticeship Week, I’m joining industry and workforce leaders at the U.S. Department of Labor to discuss a reality that is now backed by both data and experience: apprenticeship is no longer optional. It is essential. 

Across electronics manufacturing and increasingly across sectors like telecommunications, healthcare technology, and construction, the challenge is the same. Employers are struggling to find enough qualified workers to fill critical technical and production roles. This is not a temporary gap; it is a structural one driven by rapid technological change, an aging workforce, and increased demand for advanced manufacturing capabilities. 

At the same time, the U.S. apprenticeship system is gaining momentum. There are now roughly 680,000 active apprentices nationwide and more than 27,000 registered programs across industries. Completion rates continue to rise, and 90% of apprentices retain employment after finishing their programs. Yet manufacturing, including electronics, still lags behind other sectors in participation even as demand for skilled talent accelerates. 

That gap is exactly why our work began. 

Just over two years ago, the Global Electronics Association became the first organization in the U.S. electronics manufacturing industry to receive approval from the U.S. Department of Labor for National Program Standards of Apprenticeship. That milestone established a nationally recognized, industry-led framework for training electronics workers—creating consistency in skill development and credentialing where it had not previously existed at scale. 

Since then, the program has moved quickly from concept to implementation and early expansion. What began as a targeted effort to address workforce shortages has grown into a scalable model being adopted by employers across the industry. Participating companies are not only onboarding new talent but also using apprenticeships to upskill incumbent workers, an increasingly important strategy as technologies evolve. 

The driver was clear from the start: employers needed a more reliable way to build talent pipelines, not just compete for them. Registered Apprenticeship provides that structure by enabling companies to develop talent internally while aligning with industry-recognized standards and portable credentials. It shifts workforce development from a reactive approach to a proactive, long-term strategy. 

Apprenticeship is reshaping the talent pipeline itself. It creates accessible, earn-and-learn pathways into high-quality careers for new entrants, while also enabling experienced workers to advance into more technical and leadership roles. In an industry where precision, quality, and consistency are critical, this dual impact is especially valuable. 

Most importantly, it delivers measurable results. Employers participating in our programs consistently report improved productivity, lower error rates, and stronger retention among apprenticeship-trained workers. In several cases, early adopters expanded their programs within the first year. This is an indicator not only of workforce success, but of clear business return. Nationally, studies have shown that employers can see an average return of $1.40 or more for every dollar invested in apprenticeship, reinforcing what we see firsthand in electronics manufacturing. 

Over the past two years, the Global Electronics Association has secured more than $1 million in workforce funding specifically to reduce the financial barriers associated with launching and sustaining Registered Apprenticeship programs. These funds have been deployed to offset key cost components, including related technical instruction (RTI) and on-the-job training (OJT), making apprenticeship a far more accessible and practical solution for employers of all sizes. 

As a result, every employer currently participating in our apprenticeship program has benefited from some form of financial support. This has not only accelerated adoption but has also allowed employers to focus on program quality and outcomes rather than cost constraints. In many cases, funding has served as the catalyst that moved apprenticeship from a “good idea” to an actionable workforce strategy.  

There are still challenges to address, particularly for small and mid-sized businesses and for employers operating across multiple states but the momentum is clear. Collaboration between industry, government, and education partners is accelerating adoption and expanding access to apprenticeship opportunities. 

Two years in, the conclusion is straightforward: apprenticeship works. The question now is not whether to invest in it, but how quickly we can scale it to meet the needs of a modern, high-tech manufacturing workforce. 

For the electronics industry, that effort will directly shape our competitiveness, our capacity for innovation, and our long-term sustainability. When industry leads, apprenticeship delivers—and we are just getting started.