President Biden has signed the bipartisan CHIPS and Science Act of 2022 into law during a critical time for the U.S. economy.
Ongoing shortages of semiconductor chips due to COVID-19 pandemic-related supply chain issues have significantly impacted the U.S. economy, highlighting the vulnerability of global supply chains and underscoring the importance of ramping up domestic manufacturing capacity.
Unfortunately, while other countries have aggressively incentivized chip manufacturing investment, the United States has struggled to increase domestic chip manufacturing. The CHIPS Act will change that, meeting the urgent need to increase domestic semiconductor production and address the immediate economic, supply chain and national security vulnerabilities stemming from the current shortage.
With advanced technology like semiconductors, global collaboration is a key component. The U.S. has historically been able to leverage its position as the top destination for international investment and collaboration to great advantage.
For example, international investment in the U.S. semiconductor industry grew by an incredible 275 percent over the past five years, translating into 58,000 high-paying U.S. jobs and expanding high-tech hubs like Silicon Valley, Seattle and Austin into world capitals of innovation. Today, 40 percent of America’s advanced chip manufacturing capacity stems from international companies operating in the United States.
As part of this global investment in the semiconductor sector, a number of Global Business Alliance (GBA) members have made sizeable investments in the U.S. economy, including:
- Samsung’s $17 billion investment for a new facility in Taylor, Texas, which is expected to create over 2,000 high-tech jobs.
- TSMC is investing $12 billion into a new plant in Phoenix, Arizona, that will be operating in early 2024.
- EMD Electronics $28 million investment into a new factory and the creation of over 100 new jobs in Chandler, Arizona.
- ASML is investing $200 million to expand its Wilton, Connecticut, semiconductor facility, creating 1,000 new jobs.
- Infineon Technologies Americas Corp. moved its Austin, Texas, production site to renewable power with the goal to achieve carbon-neutrality by 2030.
- MediaTek’s foundry partnership with Intel to manufacture semiconductors for smart devices.
The CHIPS Act will encourage international companies from our allied countries to continue investing in, innovating and growing America’s chip manufacturing sector. This will create more advanced manufacturing jobs, ensure the supply of components essential to nearly all sectors of the economy, and strengthen our national security. It will also strategically position the U.S. to remain a major manufacturer and exporter in the semiconductor manufacturing industry over the long term.
The CHIPS Act will help maintain the U.S.’ competitive edge as a destination for international investment in the chip manufacturing sector. If Congress had missed this opportunity to act, our competitors and adversaries would have eagerly stepped into the void.
As such, GBA is grateful for the leadership from the Biden Administration, notably from Secretary of Commerce Gina Raimondo, and the bipartisan efforts in Congress on this important issue. Now that the CHIPS and Science Act of 2022 is law, GBA looks forward to the many benefits this will bring to America’s economy and national security.