A new IPC study, Digital Directions, Greener Connections, finds the electronics manufacturing industry has largely withstood the negative effects of the COVID pandemic and is poised to help drive Europe’s economic recovery and resilience, especially if anticipated government decisions take a supportive approach.
The study highlights the importance of electronic systems, especially those embedded into end user-electronics from industrial robots to an Airbus A350 to 5G infrastructures, as a main driver of global GDP growth. It forecasts the industry’s global compound annual growth rate at 3.7 percent per year for the 2018-2023 period while the World Bank forecasts overall global growth of 1.8 percent over the same period. As Europe transitions to a digital and green economy, its electronics manufacturers are poised for robust growth following many years of declining global market share.
The study, conducted by Decision Etudes & Conseil and commissioned by IPC, a global electronics manufacturing association, includes a detailed analysis of Europe’s strengths and challenges in this critically important sector and government policy recommendations to boost the resilience and competitiveness of the industry in Europe.
“Although the pandemic shattered many industries, the data shows the electronics manufacturing industry will be a key sector responsible for driving European’s economic recovery and meeting future market needs” said Alison James, IPC Senior Director of European Government Relations. “For critical mission sectors – transportation, industrial equipment, aerospace and defense, IT and telecommunications, and healthcare – to rebound from the pandemic and build towards the future they’ll need government policies that strengthen the resiliency of the electronics manufacturing industry as a whole.”
The study highlights the electronics manufacturing industry accounted for €301 billion in production value in 2019 and directly impacted €3.8 trillion in European GDP. It reveals that today, however, the EU accounts for only around 5 percent of the overall global production of printed circuit boards (PCBs) and 10 percent of electronics manufacturing services (EMS), key elements of the electronics manufacturing ecosystem.
The study comes as crucial decisions are being made at the European Commission (EC), which is releasing a revised industrial policy strategy later this month; and in national capitals, where COVID-recovery plans are being developed for potential financial support from the EC. Momentum also is building to invest in next-generation processors and semiconductor technologies. The European Union’s Recovery and Resilience Facility will make €672.5 billion in loans and grants available to support reforms and investments undertaken by Member States, with 20 percent of the funding dedicated to foster the digital transition. Member States are set to submit their plans for spending by the end of the month.
