The Extreme Shortage of High IQ Workers

At first glance it seems peculiar that semiconductors, a key item of national strategic interest, should be produced in only a few places in the world, most notably Taiwan, using devices produced only in Eindhoven in the Netherlands by one firm, ASML. Isn’t the United States big enough to be able to support all of these technologies domestically? Yes and no.

Semiconductor manufacturing is the most difficult and complicated manufacturing process ever attempted by human beings. A literal spec of dust can ruin an entire production run. How many people can run such a factory? Let’s look at the United States. The labor force is approximately 164 million people which sounds like a lot but half of the people in the labor force have IQs below 100. More specifically, although not everyone in semiconductor manufacturing requires a PhD, pretty much everyone has to be of above average intelligence and many will need to be in the top echelons of IQ.

In the entire US workforce there are approximately 3.7 million workers (2.3%) with an IQ greater than two standard deviations above the mean. (Mean 100, sd, 15, Normal dist.) Two standard deviations above the mean is pretty good but we are talking professor, physician, attorney level. At the very top of semiconductor manufacturing you are going to need workers with IQs at or higher than 1 in a 1000 people and there are only 164 thousand of these workers in the United States.

164 thousand very high-IQ workers are enough to run the entire semiconductor industry but you also want some of these workers doing fundamental research in mathematics, physics and computer science, running businesses, guiding the military and so forth. Moreover, we aren’t running a command economy. Many high-IQ workers won’t be interested in any of these fields but will want to study philosophy, music or English literature. Some of them will also be lazy! I’ve also assumed that we can identify all 164 thousand of these high-IQ workers but discrimination, poverty, poor health, bad luck and other factors will mean that many of these workers end up in jobs far below their potential–the US might be able to place only say 100,000 high-IQ workers in high-IQ professions, if we are lucky.

It’s very difficult to run a high-IQ civilization of 330 million on just 100,000 high-IQ workers–the pyramid of ability extends only so far. To some extent, we can economize on high-IQ workers by giving lower-IQ workers smarter tools and drawing on non-human intelligence. But we also need to draw on high-IQ workers throughout the world–which explains why some of the linchpins of our civilization end up in places like Eindhoven or Taiwan–or we need many more Americans.