Memory-chip prices, which dropped steeply over the past year, are expected to keep falling in the first half of 2023, putting more pressure on an industry that has already cut investments and jobs.

Average prices for the two main types of memory chips used in everyday electronics—from smartphones to personal computers and TV sets—are projected to experience double-digit percentage declines this quarter, industry analysts say. That comes after prices dropped by more than 20% in the last three months of 2022 from the previous quarter, according to analyst data. 

Memory-chip makers, many saddled with large inventories, have also issued grim outlooks as the slump in demand for gadgets persists after a pandemic boom.

Micron Technology Inc., MU -2.79%decrease; red down pointing triangle SK Hynix Inc., 000660 -0.87%decrease; red down pointing triangle Western Digital Corp. WDC -1.67%decrease; red down pointing triangle and Tokyo-based Kioxia Holdings Corp. have unveiled plans to reduce their investments aimed at capacity expansion or to lower output to address a supply glut that is getting worse. Last month, Micron Technology said it would cut jobs and spending for the year to reduce costs after reporting a loss in its most recent quarter.

Memory chips are considered a bellwether for the semiconductor industry because they are more commoditized and sensitive to shifts in supply and demand.