Chip industry projected to fall 21 percent in 2009

The semiconductor industry, a bellwether for the tech economy, is expected to fall 21 percent in 2009, according to a new forecast from the Semiconductor Industry Association.

The mid-year forecast from the official trade group of the chip industry predicts that sales will fall to $195.6 billion in 2009 from $248.6 billion in 2008.

While that forecast is bleak, it’s not unexpected, and the group forecasts that a rebound will begin in 2010. Sales are expected to grow 6.6 percent in 2010 to $208.3 billion and then 6.5 percent again in 2011 to $221.9 billion.

The normally chatty trade group didn’t supply any more information. But the data does mean the rapid drops of the early part of the year will moderate and sales gains are likely to happen by the end of the year. As the chart shows, last year’s sales began to drop in the fourth quarter. Back in November, the SIA forecast that the industry would see a drop of 5 percent in 2009.