Jim Fisher

In case you haven’t heard, there is a global chip shortage that is seeping into our daily lives --no, not potato chips; those are plentiful. I’m talking about microchips. Computer chips. Integrated circuits. Processors - the brains of the gadgets we use.  This shortage has led to chaos in areas of the economy as well as some scams out there that you should be aware of as we ramp up to the Christmas shipping season. 

From Wikipedia: “An integrated circuit (also referred to as an IC, a chip, or a microchip) is a set of electronic circuits on one small flat piece (or “chip”) of semiconductor material, usually silicon.”

In the old days, we built electronic gadgets using individual transistors that were manually soldered onto circuit cards. These chips do the same thing, but on a microscopic level that can be duplicated quickly if you have the right machines.  We used to build those machines here in the US but various US manufacturers moved those operations to China, Taiwan, and other places on the other side of the planet. That seemed like a great idea as long as something didn’t come along to upset the supply chain.

Well, something did happen (thanks ‘Rona!) and now we have a global chip crisis is in which the demand for semiconductor chips is greater than the supply.  This is affecting more than 169 major industries and has led to major shortages and queues amongst consumers for cars, graphics cards, video game consoles, and other products that require these chips.

The lockdowns all over the planet during the COVID-19 pandemic are reportedly the main cause of the chip shortage. Chip production facilities sent everyone home and were shut down leading to the depletion of inventories. To make matters worse, with more people studying and working from home during the pandemic there has been a dramatic demand for computers, monitors, network peripherals, and home entertainment internet services.

To top it all off, most industries expected a slow in demand when this pandemic first started so they cut back on orders for stuff.  Turns out people still wanted their stuff and then some so manufacturers were caught with their pants down.  The entire planet received a free graduate-level economics course on the immutable laws of supply and demand.

So what does that mean for you this shopping season? Well, higher prices on laptops, gaming systems, and a thousand other things you wouldn’t have thought of.  New laptops, for example, have at least a $50 premium above pre-pandemic prices.  Christmas demand is going to push that up a little more.  In fact, virtually all computer parts and gadgets have risen anywhere from 10% to 50%. Any gadget with advanced graphics capabilities such as game consoles and advanced graphics cards has doubled in price.

All this chaos has brought out scammers looking to cash in on people desperate to find a good deal. So, while shopping online, I hope you’ll thoroughly investigate any deal that looks too good to be true.

Jim Fisher owns Excel Computer Services in Florence. Reach him at www.ExcelAL.com