Semiconductors have been named as a frontier technology in the new Digital and Technologies Sectors Plan. The growth and scale of the industry has been astonishing in previous years, and new plans are set to support these advancements further. These include initiatives such as funding allocations, new facilities, and training programmes. The aim is to localise skills and manufacturing, propelling the UK to the forefront of new technologies.
The government have outlined strategies to achieve this, such as:
Create stronger national coordination and leadership
Boost the UK’s chip design capabilities
Invest in homegrown facilities, training and prototypes
The UK already has strong foundations to build on – from a world-class science infrastructure, an estimated £1 trillion tech ecosystem, and success stories such as DeepMind and Arm. However, with the fast-paced nature of the digital world, it’s crucial to adapt and evolve, and the new sector plan outlines key actions to support rapid expansion.
The government is planning a new UK Semiconductor Centre, a national hub that brings together government, academia and industry. This move could provide cross-industry leadership and coordinate growth in the sector. However, this is not a new idea.
The introduction of a centralised hub has long been requested by industry professionals, most recently by the Chips Coalition in an open letter to the Secretary of State in 2024. The proposed hub would take responsibility for:
Defining long-term R&D priorities.
Coordinating public and private investment.
Supporting UK chip companies to scale
There has been an agreed figure allocated of £19m in funding and an independent advisory board appointed to be the single point of contact for international firms who may wish to collaborate with the UK in the future. While this won’t instantly change production levels, it will lay solid foundations for long-term growth and direction.
With an initial investment of £5 million, the new Chip Design Enablement Programme will help smaller UK firms access world-class tools, talent, and technical support, especially around AI and advanced chip design.
This is expected to result in more UK-led chip development and intellectual property (IP), particularly from start-ups and academic spinouts – reinforcing the UK’s strength in design over manufacturing.
The plan also includes bolstering two new Innovation and Knowledge Centres (IKCs) – with £25 million invested across both. The two centres will be focusing on neuromorphic computing hardware and heterogenous integration technologies.
The two new centres are based in universities in Bristol and Southampton and will see £11 million each, with a further £3 million distributed between them with the purpose of bringing these chip technologies to market, further strengthening the UK’s position within the industry.
The industry has faced many challenges in recent years, from the Covid-19 pandemic causing disruptions sourcing critical materials to geopolitical tensions delaying domestic production of vital components.
Despite these challenges, the industry is seeing a record boom in demand for electronic devices, with the typical household having approximately 10 internet-enabled devices. Furthermore, since the pandemic, it is more common for people to work remotely, 13% on a full-time basis and 26% in a hybrid contract. These employees require equipment from companies to accommodate this.
The digital industry recognises this as an opportunity to localise manufacturing and production to UK sites, reducing reliance from overseas. Instead, they will produce these assets themselves or collaborate on a global scale with industry leaders such as the US, Tiawan and others.
The UK’s ambition is to become one of the top three global destinations for building fast-growing tech businesses by 2035, as well as aiming to deliver the nation’s first trillion-dollar technology company.
The new sector plan outlines six overall frontier technologies that will drive this transformation: Artificial Intelligence, Cyber Security, Advanced Connectivity Technologies, Engineering Biology, Quantum Technologies, and Semiconductors. Each of these plays a critical role in future-proofing industries, such as Defence, Life Sciences, and others. However, semiconductors remain a central support for each.
Semiconductors are essential to enabling progress across each of these sectors, therefore supporting their development should remain a strategic priority, as outlined in the newest plan.
Whilst the new announcement outlines exciting growth opportunities, these changes may be costly, causing delays and disruptions for businesses. Cyclops Group can support you whilst you and your business adapt for the future.
Our team have the means of supporting companies in all supply chain stages; from procuring legacy parts, to streamlining your supply chain logistics and managing your excess stock.
If you would like to learn more about the development of frontier technologies, or stay up to date on the latest industry news, subscribe to Cyclops updates today: Subscribe on LinkedIn.
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