Regarding current supply chain conditions, half (50 percent) of electronics manufacturers are currently experiencing rising labor costs, with 46 percent reporting increased material costs. At the same time, ease of recruitment, profit margins, and backlogs are presently declining. Over the next six months, electronics manufacturers expect labor and material costs to remain high, although relatively stable. Profit margins and backlogs are expected to rise, with recruitment challenges continuing to persist.

In response to special questions on geopolitical risks and trade policies and tariffs affecting business operations, more than two-fifths (42 percent) of respondents are very or extremely concerned about geopolitical risks and 44 percent are concerned with trade policies and tariffs, with no significant differences by geographical regions.

Additional survey data show:

• The Demand Index increased 3.3 percent in August.
  • This rise was fueled by better, albeit still contracting, backlog, capacity utilization that shifted to expansion, and heightened order sentiment.
• Cost pressures eased slightly in August, with both the Labor Costs Index and the Material Costs Index dropping by one point.
  • Despite this decline, both indexes remain in expansionary territory, indicating that a majority of businesses continue to face cost challenges. Notably, the Labor Costs Index hit a new low for the year.
• Industry outlook Improves in August.
  • The overall industry outlook remained robust in August, although demand sentiment has cooled from earlier highs this year.

These results are based upon the findings of IPC’s Current State of Electronics Manufacturing Survey, fielded between July 18 and July 30, 2024.

Read the full report.

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Additional presentation topics cover: safety critical electronics considerations; military, aerospace, medical, automotive, e-Mobility and other applications with specialized reliability requirements; and industry-curated content covering many different topics related to high reliability issues in PCB design, PCB fabrication materials, PCB assembly, PCBA surface reliability, emerging electronic technologies, mitigation strategies and test methods.

Speakers from the following companies include Denis Barbini, Ph.D., Zestron; Steven Dirkes, U.S. Army; Ben Gumpert, Lockheed Martin; Norbert Holle, Ph.D., Robert Bosch GmbH; Takenori Kakutani, Taiyo Ink Manufacturing; Tony Lentz, FCT Assembly; Bob Neves, Microtek Laboratories & Reliability Assessment Solutions; Tim Pearson, Collins Aerospace; Erin Tillery, NC State University; and Udo Welzel, Ph.D., Robert Bosch GmbH. View complete speaker lineup.

“The event provides a unique opportunity for those in industry who design, manufacture, or test electronics for critical applications with unique safety, reliability, and lifetime requirements to obtain the latest research on high-reliability electronics,” said Teresa Rowe, IPC senior director, assembly and standards technology. “This year, attendees will learn about the newest research and emerging trends in high-reliability electronics, hear from subject matter experts, connect with exhibitors and peers, and take advantage of several networking opportunities during the course of the two-day forum.”

IPC High Reliability Forum will be co-located with IPC Builds which is being held October 5-10, 2024, at the McKimmon Center. IPC Builds focuses on IPC standards development committee meetings and encourages industry’s contribution to the standards and guidelines that companies and their customers, suppliers, and competitors rely on. Separate registration is required.

For more information on the IPC High Reliability Forum including agenda, speaker profiles, exhibition and sponsorship information, or to register for event, visit www.ipc.org/event/high-reliability-forum. For more information on IPC Builds, visit www.ipc.org/event/ipc-builds-standards-development-committee-meetings.

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With an impressive resume, Radovan has 11 years of academic research experience and holds a Ph.D. degree in biophysical chemistry from the Dortmund Technical University. In addition, she has 13 years of regulatory experience in the global R&D industry, chiefly working in the medical and pharmaceutical sectors. In her career, she has lead global regulatory affairs for different products and clients, from small-sized companies to large enterprises, authored communications pieces on the day-to-day implementation of emerging regulations and sustainability initiatives, and helped shape and re-envision policies and standard processes, by serving on expert committees and interacting with authorities and regulatory bodies worldwide.

“Our decision to hire Diana, above all, is a testament to her robust credentials; she is skilled in analyzing and distilling complex, technical matters to inform and influence policymakers. It also reflects IPC’s commitment to a global mission with a global team. The EU and European governments are leaders in promoting and regulating sustainability, so it makes sense that our lead advocate should be based there as well,” said Chris Mitchell, IPC vice president of global government relations. “Working closely with IPC’s Lead Sustainability Strategist, Dr. Kelly Scanlon, Diana will help us to continue to provide exceptional membership and industry value through sustainability policy efforts. We are really excited to welcome Diana to IPC.”     

Radovan can be reached at DianaRadovan@ipc.org.

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Total North American EMS shipments in June 2024 were down 2.4 percent compared to the same month last year. Compared to the preceding month, June shipments decreased 3.3 percent.

EMS bookings in June decreased 3.5 percent year-over-year and decreased 2.8 percent from the previous month.

“EMS shipments were weak in June, but an even lower order flow kept the book-to-bill ratio stable, masking building weakness in the EMS sector,” said Shawn DuBravac, IPC’s chief economist.

Detailed Data Available

Companies that participate in IPC’s North American EMS Statistical Program have access to detailed findings on EMS sales growth by type of production and company size tier, order growth and backlogs by company size tier, vertical market growth, the EMS book-to-bill ratio, 3-month and 12-month sales outlooks, and other timely data.

Interpreting the Data

The book-to-bill ratios are calculated by dividing the value of orders booked over the past three months by the value of sales billed during the same period from companies in IPC’s survey sample. A ratio of more than 1.00 suggests that current demand is ahead of supply, which is a positive indicator for sales growth over the next three to twelve months. A ratio of less than 1.00 indicates the reverse.

Year-on-year and year-to-date growth rates provide the most meaningful view of industry growth. Month-to-month comparisons should be made with caution as they reflect seasonal effects and short-term volatility. Because bookings tend to be more volatile than shipments, changes in the book-to-bill ratios from month to month might not be significant unless a trend of more than three consecutive months is apparent. It is also important to consider changes in both bookings and shipments to understand what is driving changes in the book-to-bill ratio.

IPC’s monthly EMS industry statistics are based on data provided by a representative sample of assembly equipment manufacturers selling in the USA and Canada. IPC publishes the EMS book-to-bill ratio by the end of each month.

To learn more, visit www.IPC.org.

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The Opportunity Next Colorado Scholarship Program aims to increase enrollment in Colorado-based postsecondary education and training programs by prioritizing learners who pursue an in-demand or high-priority pathway. Scholarships are awarded to all eligible students who intend to enroll at a university or college to pursue an in-demand or high-priority postsecondary pathway or to students who intend to participate in a registered apprenticeship program. Each scholarship award provides a maximum of $1,500 per recipient. The student can use scholarship money for tuition, fees, and books.

“This opportunity aligns perfectly with our commitment and efforts to build a talent pipeline for the electronics manufacturing industry. What better way to support talented aspiring engineers in their next steps towards pursuing careers within the industry?” shared Charlene Gunter, senior director of IPCEF. “Meeting the students virtually via Zoom, seeing the excitement about the next chapter in their lives, and learning more about their career interests in becoming (electronics, aeronautical, mechanical) engineers cemented the positive impact this scholarship has for each one of them. We are grateful to Opportunity Next Scholarship Program for entrusting us with the award, and we are excited to play a small part in these students’ future careers.”

IPC, IPCEF’s parent organization, has successfully assisted OEMs, EMS, PCB manufacturers, cable and wire harness manufacturers, and electronics industry suppliers for 67 years. More than 3,200 companies worldwide depend on IPC programs and services to further their competitive advantage and financial success, including identifying skilled workers.

IPCEF’s relationship with local high schools, community colleges, and universities in Colorado has enabled IPCEF to support students beyond their existing programs. One of the schools that participated in a select program, the LPS Explorative Pathways for Innovative Careers “EPIC” Campus, officially opened in August 2023, produced 10 students benefiting from this opportunity.

EPIC’s programs allow students to experience hands-on learning using state-of-the-art technology and innovative processes. Educational pathways aligned to industry standards will focus on the following areas: aerospace, business and entrepreneurship, computer science, construction trades, future educators, health science, and natural resources.

Travis Amonson, Principal at EPIC Campus shared the following statement, “The EPIC Campus in Littleton, Colorado, was fortunate to receive grant funding at the end of the 2023-2024 school year from IPC through Opportunity Next. There were 10 recipients of scholarships.  All 10 students plan to attend college and major in a degree related to the aerospace Industry. At the EPIC Campus, students participated in the Aerospace Pathway, which offers classes related to aerospace engineering, advanced manufacturing, and electronics. Students could take these classes, better understand the work, and make an educated decision about future plans. We are incredibly grateful for the partnership with IPC and the grant funding as it will certainly help students and their families as they pursue their degrees.”

IPC and IPCEF continue to look for opportunities to support the industry by identifying talent hubs for future employment. Victoria Hawkins, IPC director of workforce grants and proposals, stated, “We’ve been awarded $15,000 through this program and made a difference in 10 highly deserving student graduates from a Colorado high school, EPIC Campus. Our partnership with EPIC is unique, and this scholarship will support these students’ next steps in pursuing undergraduate degrees in an in-demand or high-priority postsecondary pathway, which includes engineering and technology and advanced manufacturing.”

Interested recent high school graduates who would like to learn more about this scholarship opportunity and in need of financial support whilst pursuing a degree at a local Colorado-based university, can visit the following website and complete the interest form: www.ipcef.org/opportunity-next-colorado.

For more information on the grant opportunity, IPC, IPCEF and EPIC, visit the links below:

• Grant information: www.oedit.colorado.gov/programs-and-funding/opportunity-next-colorado
• IPCEF: www.ipcef.org
• IPC: www.ipc.org

EPIC: www.littletonpublicschools.net/schools/epiccampus/welcome

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Regarding outlook for the next six months, electronics manufacturers expect both labor and material costs to come down slightly. Although profit margins, backlogs and ease of recruitment are likely to remain challenging, manufacturers expect capacity utilization to rise significantly.

Additional survey data show:

• Industry demand fell slightly, dropping to a neutral level between expansion and decline.
  • Demand fundamentals weakened for the fourth consecutive month, falling to the lowest level since October 2023.
  • The Demand Index is down 1.5 percent from last month.
  • Demand was dragged lower by weaker backlogs and weaker new orders. The New Orders Index dropped two points and the Backlog Index dropped four points. The Capacity Utilization Index and the Shipment Index remained consistent with June results.

• Cost pressures eased in July.
  • The Labor Costs Index dropped two more points this month and the Material Costs Index fell five points.
  • The Labor Costs Index set a record low in July. However, both indices remain in expansionary territory suggesting a majority of businesses continue to face cost pressures.

• Industry outlook fell slightly, dropping to the lowest level in a year.
  • The industry outlook remains strongly positive, though it continues to soften.

These results are based upon the findings of IPC’s Current State of Electronics Manufacturing Survey, fielded between June 14 and June 30, 2024.

Read the full report.

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In addition, the whitepaper provides a high-level exploration of the full “silicon-to-systems” ecosystem, examines the justification and implications of an Authoritative Source of Truth (ASOT), discusses the need for synergy between building blocks of electronic systems, and takes a deep dive into the subject of design rules and “design for manufacturability.”

Key messages within the white paper include:

• Electronic systems are increasingly complex and heterogeneous.
• Facilitation of an Authoritative Source of Truth (ASOT) is mandatory to ensure consistency, efficiency, and traceability.
• The industry needs a more robust and interoperable toolset to support greater silicon-to-systems collaboration.
• Diverse electronic and mechanical CAD systems must gain interoperability by including proper model-based definitions (MBD) and collaborative software to cover both disciplines.
• A shift towards true digital collaboration and automation and an early consideration of manufacturing capabilities across the development process is essential to master increasing time-to-market and complexity challenges.

“Creating better electronics by design is a common, collective goal of the electronics industry,” said Peter Tranitz, IPC senior director, technology solutions, and leader of IPC’s design initiative “To achieve this, an ASOT should be established and protocols, standardized. To leverage the associated benefits, a culture of real digital collaboration, transparency, and accountability needs to be established. Tools need to support bi-directional, incremental exchange of information. And, design rules need to be broken down to the relevant stages of the design workflow and checks need to be performed after every stage of the design process to drive the concept of ‘shift left.’ For effective Design for Manufacturability execution, manufacturers need to provide clear guidance on manufacturing capabilities and constraints to designers.”

Download the report:  www.go.ipc.org/next-gen-design.

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Total North American PCB shipments in May 2024 were down 6.8 percent compared to the same month last year. Compared to the preceding month, May shipments were down 16.5 percent.

PCB bookings in May were down 6.4 percent compared to the same month last year. May bookings were down 2.7 percent compared to the preceding month.

“The sluggish growth in the PCB industry reflects broader economic headwinds and likely signals a period of slower growth,” said Shawn DuBravac, IPC’s chief economist.

Detailed Data Available

Companies that participate in IPC’s North American PCB Statistical Program have access to detailed findings on rigid PCB and flexible circuit sales and orders, including separate rigid and flex book-to-bill ratios, growth trends by product types and company size tiers, demand for prototypes, sales growth to military and medical markets, and other timely data.

Interpreting the Data

The book-to-bill ratios are calculated by dividing the value of orders booked over the past three months by the value of sales billed during the same period from companies in IPC’s survey sample. A ratio of more than 1.00 suggests that current demand is ahead of supply, which is a positive indicator for sales growth over the next three to twelve months. A ratio of less than 1.00 indicates the reverse.

Year-on-year and year-to-date growth rates provide the most meaningful view of industry growth. Month-to-month comparisons should be made with caution as they reflect seasonal effects and short-term volatility. Because bookings tend to be more volatile than shipments, changes in the book-to-bill ratios from month to month might not be significant unless a trend of more than three consecutive months is apparent. It is also important to consider changes in both bookings and shipments to understand what is driving changes in the book-to-bill ratio.

IPC’s monthly PCB industry statistics are based on data provided by a representative sample of both rigid PCB and flexible circuit manufacturers selling in the USA and Canada. IPC publishes the PCB book-to-bill ratio by the end of each month.

To learn more, visit www.IPC.org.

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