Saturday, May 13, 2023
Thursday, May 11, 2023
Taiwan Is Running Low on a Strategic Asset: Engineers - The New York Times
Taiwan Is Running Low on a Strategic Asset: Engineers
"Taiwan’s world-dominating microchip sector was built by TSMC’s skilled employees. But a demographic crisis, demanding work culture and flagging interest threaten its lead.
Engineers like Royale Lee, 31, are one reason Taiwan is the world’s biggest contract producer of the microchips that power almost all electronics.
When a computer virus paralyzed machinery at his employer, Taiwan Semiconductor Manufacturing Company, Mr. Lee pulled a 48-hour shift to help fix the problem. For years he responded to phone calls day and night. But in late 2021, after five years of sacrifices, he had come to fear the ring of his phone. His annual compensation of $105,000, an envied sum in Taiwan, was not enough for him to stick around.
Over the past decade, TSMC, as the company is known, has built a wide lead over rivals like Intel and Samsung in the race to make the smallest — and fastest — microchips. Largely because of the ingenuity of its engineers, TSMC has become one of the most geopolitically important firms in the world.
Today, many at the top of Taiwan’s semiconductor industry fear the tiny island territory will not be able to sustain the growing demand for a new generation of engineers. A shrinking population, demanding work culture and an abundance of competing tech jobs have meant workers have become ever more scarce.
The stakes are enormous. Some military strategists argue that TSMC’s dominance in microchips provides Taiwan a guarantee against an invasion by China — in part because the United States would need to defend such an important piece of its supply chain.
Taiwan’s talent crisis is intertwined with TSMC’s success. The company’s employee count has grown almost 70 percent over the past decade, while Taiwan’s birthrate has plummeted by half. Start-ups in promising fields like artificial intelligence are luring top engineers. In recruiting, TSMC must compete with internet companies like Google and foreign semiconductor companies like ASML of the Netherlands, which generally offer better work-life balance and perks like free food.
TSMC’s leaders have defended the company’s famously tough work culture, which has helped it grow into a $440 billion behemoth with 73,000 employees. Morris Chang, the founder, recently defended the military discipline he expected — spouses, he said, would just fall back asleep when TSMC called employees to work in the middle of the night. But in recent years, TSMC Chairman Mark Liu has repeatedly acknowledged that the largest challenge facing Taiwan’s semiconductor industry is its shortage of talent.
Taiwan’s largest job search platform, 104 Job Bank, had over 33,000 listings for chip industry jobs as of August. Last year, Taiwan’s chip sector employed about 326,000 people, according to the government-affiliated Industrial Technology Research Institute.
TSMC has been forced to adjust its recruitment strategies. It has broadened hiring channels and increased its base salary for master’s graduates, who can now expect to receive an average annual compensation of up to $65,000. It begins recruiting Taiwanese graduate students in September, well ahead of the conventional job-hunting season of March, and has even begun to cultivate high schoolers with online classes about the basics of semiconductors.
“Many companies are struggling to find suitable candidates,” said Burn Lin, a former vice president at TSMC and the current dean of National Tsing Hua University’s College of Semiconductor Research.
“Now when searching for talent, they are not very picky,” Mr. Lin said. “You don’t necessarily have to study electrical engineering or computer science.”
The college Mr. Lin heads is one of four specialized semiconductor schools that were established by the Taiwanese government in 2021 in response to calls for action by industry players like Mr. Liu and Tsai Ming-kai, chairman of the chip design firm MediaTek.
“In cultivating semiconductor talent, we are racing against time,” Tsai Ing-wen, Taiwan’s president, said at the unveiling of Mr. Lin’s semiconductor college.
The challenges facing Taiwan’s chip industry come amid a global crunch. In China, where officials have sought to lure Taiwanese engineers to build up its fledgling chip industry, the state-backed Chinese Academy of Sciences has fretted about a “serious shortage” of qualified workers. By one estimate, China’s microchip industry was short 200,000 people.
In the United States, government efforts to use billions of dollars in subsidies to attract semiconductor plants have spurred Intel, Samsung, TSMC and others to announce plans for new plants. But surveys of executives showed talent shortages remain a problem.
At TSMC, the recruitment gap back home has added urgency to its efforts to build factories, and train workers, outside Taiwan. Unlike most major hardware companies, which long ago spread research and production across the world, TSMC has built the vast majority of its chip manufacturing plants, known as fabs, in Taiwan. The clustering of its best employees and suppliers as well as most cutting-edge plants has helped it over the years, but the company needs to start looking beyond Taiwan, according to Harvard Business School professor Willy Shih.
“If I were TSMC I’d get serious about finding other places where I can get that talent,” he said.
Making semiconductors requires skilled and disciplined employees and it is part of the reason TSMC excels at it, said Wu Chih-I, director of the TSMC-National Taiwan University Joint Research Center.
Mr. Wu, who worked as an engineer at Intel early in his career, said tech workers today are more interested in jobs that fit their interests, rather than just pursuing a paycheck as his generation was.
“If you don’t have significant financial pressure, you might choose a less demanding job, even if it means passing up the high salary and promising future of a semiconductor career.”
Mr. Lee, the former TSMC employee, said younger Taiwanese are less willing to endure the grueling experience of working in a fab.
“It’s no longer as glorious as it used to be,” said Mr. Lee, who now works as a web developer for an American firm.
Jason Chin, senior vice president of 104 Job Bank, said TSMC and other chip companies will never stop the turnover without improving working conditions.
That applies not just to workers like Mr. Lee who face the grueling job of keeping plants running, but also critical researchers who think up new ways to make chips ever faster.
Frank Lin, 30, is one such TSMC researcher who left because he found the work tedious and unfulfilling. His role as product engineer and chip designer was not as high pressure as others at the company, but he nonetheless struggled, craving more meaning and a sense of accomplishment. Even though he had a master’s degree from one of Taiwan’s most prestigious universities, he was given scant responsibility and assigned rote daily tasks.
“Though the amount of money I make continues to increase, is this all there is to life?” he remembered thinking often at work when sitting in a sunlit office pantry. After fewer than three years at the company, he struck out on his own as an independent financial adviser. He hasn’t looked back. “People want to work for themselves. There are so many possibilities in the outside world right now,” he said."
Wednesday, May 10, 2023
Sunday, May 07, 2023
Mark Zuckerberg is facing a morale crisis after multiple Meta layoffs - The Washington Post
How Mark Zuckerberg broke Meta’s workforce
Roiled by waves of layoffs and a costly investment in the metaverse, many insiders say the Facebook founder has lost his vision — and the trust of his workforce
Mark Zuckerberg sounded nervous.
The Meta CEO had just announced that his company would slash thousands of jobs last month, on top of 11,000 layoffs in November.
During an hour-long town hall meeting from the company’s Menlo Park headquarters in California, the decimated workforce peppered Zuckerberg with questions — including why they should have confidence in his leadership.
“That’s a completely fair question,” Zuckerberg responded without his usual bluster, according to a recording of the meeting obtained by The Washington Post.
It was a sobering admission for the CEO, who popularized the phrase “move fast and break things” to describe how he made a scrappy start-up into a towering $116 billion symbol of Silicon Valley success. Zuckerberg has shepherded Meta through years of public turbulence, offering employees confident defiance and the security that, despite some missteps, their CEO always bet on the correct future.
But now, roiled by economic tumult, waves of layoffs that will slash some 21,000 workers and a costly investment in the virtual reality “metaverse” that shows no immediate signs of paying off, many inside Meta say Zuckerberg has lost his vision — and the trust of his workforce. Instead, he is steering the company into an unprecedented morale crisis, according to interviews with more than two dozen current and former employees who spoke on the condition of anonymity for fear of retribution.
“It’s like they went from ‘move fast and break things’ to ‘slow down, break things,’ then ‘maybe fix it later on a case-by-case’” basis, one of the employees said.
Meta’s core product, Facebook, is battling TikTok for users and marketers. Economic forces have cut into its advertising business. The company lags on generative artificial intelligence, which is quickly revolutionizing the tech industry.
Last week, Meta’s stock rose 13 percent on news that quarterly revenue had ticked up for the first time in nearly a year. But insiders say the layoffs — along with pledges from Zuckerberg for further cost-cutting — have shattered internal resolve.
Even in the highest ranks of Meta’s leadership, some blame Zuckerberg for the company’s malaise. For example, Meta hired 41,000 people during the pandemic, in a frenzy to invest in labor while money was pouring in. During a company meeting this month, Chief Technology Officer Andrew Bosworth said Zuckerberg made some hires over the “objections” of senior executives — and sometimes rebuffed their advice in order to fire people, according to two people who spoke on the condition of anonymity to discuss private company matters.
Zuckerberg has characterized the cost-cutting as painful but necessary, part of a “year of efficiency” aimed at preparing the company for slower revenue growth triggered by rising interest rates and geopolitical instability. He’s part of a cohort of tech executives who have responded to the shifting market by cutting staff.
Zuckerberg was personally involved in the cuts, despite keeping a reduced work schedule because of the birth of his third child. He has deputized a cadre of top executives along with people in human resources, legal and finance departments to help redraw the organizational charts and find ways to make the company more efficient.
In a statement, Meta spokesman Dave Arnold said the conditions that led to the layoffs are “well known and reverberating throughout the industry.”
“Mark has been transparent about how we’re becoming more efficient to make us a better technology company and improve our financial performance,” Arnold said.
Still, morale is low. It was already harder for the company to attract and retain the best talent thanks to an array of scandals, including Facebook’s role in spreading misinformation in the 2016 election. In an internal employee survey in October, before layoffs, just 31 percent of respondents said they were confident leaders were taking the company in the right direction — an 11-point drop from May 2022, according to one of the people.
Zuckerberg promised last week that the company will return to stability once the restructuring is over. But as employees persevere through seven months of continuous job cuts, it’s unclear if the CEO will be able to regain their confidence.
“What was special about Meta was the trust. We drank the Kool-Aid and really felt like it was our company [and] even willingly defended it when everyone said we were evil incarnate,” one current employee said. “But that’s been shattered, so it feels like a betrayal.”
For years, Meta hired plentifully, luring workers with generous benefits and some of the highest salaries in tech. Company culture encouraged recruiting. Every year, Zuckerberg consults with executives to set up hiring goals based on business priorities — a process that was sometimes called “Napkin,” according to one of the people.
Ambitious managers could move up the ladder by proposing projects requiring them to spin up a new team or claim a departing manager’s direct reports. These climbers were privately called “empire builders” or “kingdom builders” by their colleagues, according to three of the people.
And Meta could afford to build up legions of “kingdoms.” Throughout 2020 and 2021, Meta benefited from an influx of brands using Facebook and Instagram to reach customers, as the coronavirus pandemic forced shoppers online. By early 2021, the company said e-commerce had become its largest advertising sector. “Commerce has been growing on our services for a while,” Zuckerberg told investors in April 2021. But the pandemic made it “a lot more important.”
Meta quickly retooled to take advantage of the demand. For years, the company grew its employee ranks by double-digit percentage points; the trend accelerated during the pandemic. Head count nearly doubled between 2019 and 2022, according to regulatory filings. It launched Facebook and Instagram Shops, digital storefronts for selling products on Meta’s social networks and produced Live Shopping, a social media version of the Home Shopping Network.
But this reliance on e-commerce was risky. It’s easy for companies buying digital ads to pivot quickly when those ads no longer lead to sales.
The company was following a similarly optimistic prediction as it plunged into virtual reality. For years, Zuckerberg has pitched a lofty vision of the metaverse, an immersive world that he argued would become the next great computing platform after mobile phones — a revolution that Meta failed to take advantage of.
But when Zuckerberg renamed the company Meta in October 2021, reflecting a new emphasis on virtual reality, employees greeted the move with trepidation. Some inside Reality Labs, Meta’s virtual reality division, were happy to be the new center of gravity but worried about the increased scrutiny on a division that hadn’t yet achieved commercial success. “We are no longer a footnote. We are a line item,” one former employee said.
Since Meta’s 2014 acquisition of the virtual reality company Oculus, its investment in hardware development and research has exploded. Meta has tried to build everything including augmented reality glasses, smartwatches and VR headsets, sometimes deploying different teams to work on different generations of the same device at the same time.
“It was built like a software company that was trying to experiment instead of a mature hardware company that was trying to build hardware,” one former employee said.
The company has stuck with products long after it was clear they weren’t appealing to users. Since 2018, Meta has been pitching its video calling devices, Portal, as a next-generation communication device.
But behind the scenes, employees would regularly bring up data showing that the devices were missing their sales targets. Users who did buy them didn’t use them frequently.
“They missed their goals regularly,” one former employee said. “But everyone knew that didn’t matter.”
Instead of quashing the product, Meta rebranded: During the pandemic, Portal was pitched as a business product for remote work. It wasn’t until 2022 that the company finally scrapped the devices, which had then grown to include four different versions.
Similar issues plague the company’s Quest headsets, which were intended to provide an on-ramp to Meta’s virtual reality app, Horizon Worlds, and other third-party apps. Instead, Meta executives found that buyers often use them for only a few weeks. And users who do use the headsets often flock to competing apps, such as Rec Room and VRChat.
Meta has been losing billions trying to turn its metaverse vision into a reality. Reality Labs lost more than $13.7 billion last year — up from the $10.2 billion it lost in 2021 and the $6.6 billion in 2020, according to regulatory filings.
John Carmack, the former chief technology officer of Oculus and a high-ranking consultant for the company’s virtual reality division, quit in December, frustrated he couldn’t fix the inefficiencies plaguing the division, despite his high rank and relative power.
“We have a ridiculous amount of people and resources, but we constantly self-sabotage and squander effort,” Carmack wrote in his goodbye message. “There is no way to sugar coat this; I think our organization is operating at half the effectiveness that would make me happy.”
By early 2022, Meta’s optimism started to fade. The company reported that its flagship app, Facebook, lost daily users for the first time in its decade as a public company — falling by about half a million users in the last three months of 2021. The company’s stock plunged by more than a quarter.
That summer, Zuckerberg and other executives began signaling internally that managers needed to identify their lowest-performing employees. Newly implemented hiring freezes threw the entire human resources and recruiting division into a tailspin. Over the coming months, the company rescinded job offers or didn’t bother hiring recruiters’ recommended applicants.
The blunt messaging from Zuckerberg and other leaders created a wave of anxiety and resentment among Facebook’s workforce. Employees worried they could lose their jobs, receive lower annual bonuses or that an already rigorous corporate environment would grow even more competitive, the people said.
Zuckerberg stands out in Silicon Valley as one of the few founders who still leads a big tech giant long after its initial public offering, and he controls 61 percent of voting shares — leaving his power virtually unchecked.
Critics say Zuckerberg often surrounds himself with longtime deputies who have spent much of their careers working within Meta’s systems and culture, limiting the range of perspectives he is likely to receive.
Former COO Sheryl Sandberg, often thought of as a “co-CEO,” left last year. Zuckerberg tapped Javier Olivan, who had been working at the company since 2007, to take a more limited COO role — splitting up her role among several different executives, the majority of whom had worked at the company about a decade or more. (In recent years, Meta has appointed new members to its board and elevated Global Affairs President Nick Clegg.)
“These are all talented and experienced leaders who I’ve worked closely with over the years, and I’m confident they’ll continue to do great work in this new structure,” Zuckerberg said at the time.
When the layoffs came in November, deciding who to cut was left to top executives — not individual managers, according to a person familiar with the matter. When media reports surfaced that thousands of employees would be laid off a few days before the company’s own announcement, Bosworth, along with other top Meta executives, decided not to address the matter. The article was “vague” and staffers were still being productive, so they didn’t adjust their long-standing layoff plans, Bosworth said, according to a recording obtained by The Post.
“I got this wrong. It was a big mistake,” Zuckerberg said at the same meeting, referring to his overestimating revenue. “Going forward — what this means — is we have to be a leaner and more capital-efficient company.”
The company is now in the midst of its second round of layoffs, eliminating 4,000 jobs this month.
At a town hall this month, Zuckerberg provided a forceful defense of why workers should stay at the company: No other tech firm is delivering social experiences to billions of people in the way that Meta is.
“At the end of the day, I hope that you are here because you believe in the work that we are doing,” Zuckerberg said. “This is a very special place.”