Embedded systems: successfully competing for talents globally

The embedded systems industry is at the interface of digitalization and innovation and forms the foundation for technological breakthroughs in such areas as the Internet of Things (IoT) and Industry 4.0. However, the industry’s momentum is increasingly being hampered by a shortage of skilled specialists. Global competition for talents in the semiconductor and embedded systems industry is intensifying. To remain competitive, companies need to develop innovative strategies.

Embedded systems and IoT: growth drivers of Industry 4.0

The demand for embedded systems is growing rapidly. From intelligent production systems to networked household appliances and autonomous vehicles—microcontrollers and embedded systems form the basis for smart and networked technologies. The market for embedded systems technologies is expected to grow by 9.1 percent annually until 2030, according to a report issued by Grand View Research.

By contrast, Research and Markets forecast in a report issued in November 2024 that the growth rate would total only 4.9 percent annually. The IoT and Industry 4.0 are considered to be the most important growth drivers. However, this technological progress can be implemented only if the right expertise is available. Knowledge of system design, real-time operating systems and the implementation of secure communication protocols is becoming increasingly important.

Global challenges: the battle for embedded systems talents

The global shortage of skilled workers in the embedded systems industry is showing alarming trends. An analysis issued by McKinsey in 2024 predicts a shortage of 1.5 million skilled workers worldwide over the next five years in the semiconductor industry alone, an area that is closely linked to embedded systems. This shortage will lead to intense competition, especially in such emerging markets as India, China and Eastern Europe where companies are systematically recruiting talents.

According to a survey of 200 leading companies in the embedded systems sector, 65 percent are having difficulties filling vacancies. High-demand areas include:

Experts for microcontroller programming
IoT specialists with a focus on sensor technology and data analysis
Specialists for the development of safe and energy-efficient systems

The speed of technological innovation creates additional pressure. Companies that cannot adapt quickly run the risk of falling behind competitors that are better positioned to attract and retain talents.

Strategies for recruiting IoT and embedded systems experts

Leading companies are taking three innovative approaches to compete for the best minds:

1. Upskilling and reskilling: future-proof embedded skills

Advanced training for existing employees is becoming increasingly important. Companies are investing more and more in internal training programs to develop skills in such key areas as IoT protocols, artificial intelligence and hardware security. Online learning platforms and hybrid training models that offer employees flexibility and customized content are particularly popular.

2. University partnerships: promoting the experts of tomorrow

Partnerships with universities and research institutions play a central role. International technology companies fund scholarships and research projects to ensure access to new talents. These investments not only promote innovation, but also position the companies as attractive employers. In Germany, companies like Bosch and Siemens have successfully established dual study programs that combine practical experience with academic training.

3. Global recruitment strategies: utilizing remote work and diversity

The focus on diversified talent pools is becoming increasingly important. Remote working opportunities and flexible working models enable companies to attract international talents and promote cultural diversity in teams. In the embedded systems industry in particular, collaboration across national borders can promote creative problem-solving and innovative approaches.

Using automation and AI in embedded development

In view of the shortage of skilled workers, many companies are turning to automation and the use of artificial intelligence (AI) to optimize development processes. AI-supported tools for software testing and hardware design can shorten development cycles and improve quality. One example is automation tools for debugging microcontroller-based systems, which minimize repetitive tasks and give developers more time to develop creative solutions.

Despite the strengths of automation, human expertise remains indispensable. Although technologies can speed up processes, innovative products can be developed only by specialists with deep expertise.

Strengthening employer branding in the IoT and embedded systems industry

A frequently overlooked aspect of the competition for talent is the strengthening of the employer brand. Companies that emphasize such values as sustainability, diversity and a strong culture of innovation have a better chance of attracting and retaining top talents. Building an attractive corporate culture begins not only with such benefits as flexible working hours, but also with clear communication of the company’s vision and values.

Younger professionals in particular—the so-called Generation Z—attach great importance to ethical behavior and the opportunity to work on projects that have a positive social impact. Companies that understand and fulfill these expectations position themselves successfully in the competition for talents in the long term.

Long-term strategies for sustainable success

The embedded systems industry is facing a decisive phase. To fully exploit the potential of IoT and Industry 4.0, companies must not only develop innovative technologies, but also pursue long-term strategies to attract and retain talents. The combination of training initiatives, global recruitment, technology solutions and a strong focus on corporate culture will be crucial to remaining successful in the face of global competition.