The CHIPS and Science Act—the Biden administration’s $53 billion boost to the domestic semiconductor industry—turned one year old on August 9. The law, which received bipartisan support in the House and Senate, set aside funding for semiconductor research and development, workforce efforts, and supply chain reliability, and created a 25% tax credit for manufacturing expenses.
Tech Brew caught up with Allen Thompson, who leads US-Canada government affairs at semiconductor chip maker Intel, to find out about how the first 12 months of funding have impacted the chip giant and its US production capabilities.
“There’s been a lot of seismic movement, and I would say the CHIPS Act has catalyzed the investments in a way that I think the bipartisan majorities in Congress envisioned,” Thompson told Tech Brew.
“There’s a saying that in Washington when you have strong bipartisan agreement, either it’s an idea whose time has come or the members didn’t read the bill,” Thomson joked. “What was unique about CHIPS was the recognition of the fragility of many supply chains that the pandemic exposed, and an additional focus on the criticality that semiconductors play in modern life.”
Thompson credits some of Intel’s own plans for growth—doubling semiconductor factories in Arizona to four, investing in equipment upgrades for its New Mexico packaging operations, and developing two new fabrication plants in Ohio—to the legislation.
“If not for the CHIPS Act, I’m not sure we would have announced plans on the scale that we’re talking about,” Thompson said. “It allows us to basically take our plans and go faster.”
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Labor challenges: The semiconductor industry is facing an impending worker shortage, and increased domestic manufacturing capacity, thanks in part to the CHIPS Act, will mean a greater number of jobs “in time,” Thompson said.
But the industry is getting out ahead of that challenge, he added, pointing to efforts like the $13.2 billion for R&D and workforce development and $200 million for the National Science Foundation’s semiconductor training and education programs.
“The industry is going to have access to federal dollars to be able to also develop talent pipelines around the country,” Thompson said. “There are a lot of opportunities to leverage government funding and incentives to develop workforce development and talent pipelines to support what the industry is going to need for decades to come.”
Moving forward into year two, Thompson said implementation is key, particularly when it comes to setting up research and development centers, like the promised National Semiconductor Technology Center and National Advanced Packaging Manufacturing Program.
“I think the government needs to put out a clear timeline of when decisions are going to be made, and an end goal of when these centers will be stood up,” he said.
“There’s flexibility in the law to spend the money over time, to be able to support a whole bunch of things. With that said, you don’t want to have such a lag to where the money appropriated for the research centers hasn’t been spent because you haven’t made decisions.”
Editor's note 08/17/2023: We've added Allen Thompson's updated title.