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States Flex Job Creation Following CHIPS Act Passage, Panelists Say

The three states showcased efforts at growing the semiconductor industry.



Screenshot of ITIF's webinar titled on the CHIPS Act

WASHINGTON, September 11, 2023 — Officials from Arizona, New York and Texas touted at a webinar Wednesday an increase in manufacturing and jobs as a result of the passage of the CHIPS and Science Act in July 2022.

Information Technology and Innovation Foundation, a non-profit organization promoting information technology and supportive of the CHIPS Act, highlighted recent progress in the semiconductor industry.

“We launched a partnership with Plug and Play and we created a new office here,” Sandra Watson, president and CEO of the Arizona Commerce Authority said.

Watson noted the significance of her state’s collaboration with the leading innovation platform and their commitment to manufacturing. Additionally, Arizona launched two of six new advanced manufacturing training centers to work with industry partners.

“[This is] to ensure that they’ve got the talent and the workforce they need,” Watson said.

In New York, the creation of the Office of Strategic Workforce Development focuses on expanding the manufacturing and technology workforce in the state, “including the semiconductor industry,” said Kevin Younis, chief operating officer and executive deputy commissioner of Empire State Development.

The office has awarded more than $24 million to 39 projects for training purposes impacting 9,000 people for more than 300 different businesses.

The state has also invested $200 million to their Focused Attraction of Shovel-Ready Tracts New York grant program. It was designed to assure that New York “has a variety of shovel ready sites across the state,” Younis said.

The state’s investment to FAST NY is to establish sites to attract “high-tech manufacturing, particularly semiconductor manufacturing, warehousing, distribution and logistics businesses to the state to jumpstart New York’s shovel-readiness and increase the state’s attractiveness to large employers.” 

Younis also acknowledged the creation of the Governor’s Office of Semiconductor Expansion, Management, and Integration that will oversee Micron’s $100 billion investment which will build the world’s largest chip fab in Central New York.

GO SEMI will assist local community by coordinating workforce development and community investments as well as create and support policies to appeal to the “semiconductor industry, supply chain, and skilled workers to New York.” 

Younis added that Micron’s decision to invest in central New York was due to the company recognizing a “rich pool of diverse talent encompassing communities underrepresented in technology jobs” and offering future Micron employees many benefits that included potential partnerships with “local K-12 programs, community colleges, and institutions for top engineering and technical talent.”

In preparation for the passing of the CHIPS Act, Gov. Greg Abbott created the Texas Semiconductor Task Force, which was an idea to lead “state government, the semiconductor industry, higher education institutions, and workforce stakeholders to best position Texas for the future,” said Wes Hambrick, federal affairs director in the governor’s office.

Hambrick stated that Texas has been leading regular conversations with “important stakeholders” in the state and have been in consistent communication with partners at the Commerce Department and CHIPS Program office to further discussions about where state partnership is needed to “successfully secure the supply chain.”

He added that Abbott advised that “state funding be available to leverage federal funding” that was provided by the CHIPS Act.

“This included state support for workforce training programs, higher education, research, infrastructure improvements, tax incentive, and other funds, among many other items that the Legislature worked on,” Hambrick said.

The efforts showcased by the three states demonstrated their commitment toward growing the semiconductor industry and support for the CHIPS Act. An advancement only made possible by taking initiative and collectively working together at the state and federal level.

“This is going to require a whole of society call to arms and call to action across industry colleges, government, the private sector, nonprofits, partners, unions,” said Rachel Lipson, senior policy advisor for the White House’s CHIPS program office. “It’s really going to require all of us coming together.”


Raimando Calls for U.S. Investment in Semiconductor Manufacturing in Allied Countries

Raimondo said U.S. seeks to impose restrictions on the export of microchips to China to combat the county’s influence.



WASHINGTON, July 31, 2023 – Commerce Secretary Gina Raimondo said Wednesday that the U.S. should invest in the semiconductor manufacturing facilities of allied countries and impose restrictions on the export of those chips to China to combat the Communist nation’s influence.

Under the Chips and Science Act, Congress appropriated funding for the domestic manufacturing of microchips in America, setting aside about $39 billion for grants and subsidies for chip makers and their suppliers, plus another $11 billion to set up research centers on chip design. To handle the task, the Commerce Department last year launched the new CHIPS office, which also would provide loan guarantees for as much as $75 billion.  

The CHIPS office already has received more than 400 statements of interest from semiconductor manufacturers keen to get a share of the federal dollars. Preliminary applications for grants and subsidies will be accepted beginning in September, with final applications starting Oct. 23, according to the Commerce Department.

Speaking on a panel hosted by the American Enterprise Institute alongside Sen. Todd Young, R-Indiana, Raimondo added that, on top of domestic manufacturing incentives, there is a need for future export controls against China and investing in allied semiconductor facilities to bolster national security. 

Proposals to work more on technology with allies

Raimondo proposed that the government lean into the resources offered by their allies, such as R&D in Japan, and raw materials in Ukraine to create their own supply chain. By investing in industries linked to the supply chain in allied countries, she said that America would benefit overall.

Conditions would not be so broad “that you deny American companies revenue and China can get the product elsewhere, or China can get the product from other countries,” Raimondo said. Incoming rules “will deny some revenue to American companies, but we think it’s worth it.”

Raimondo said the administration is meeting with companies “to get to the right place so we don’t damage American business but quite frankly protect American national security.” 

The United States needs to invest in its capacity to produce high-end chips, Raimondo said, while preventing the most advanced technology from reaching China. She highlighted concerns about China’s substantial subsidies in the semiconductor sector, which could lead to an excess of mature and legacy chips. 

“The amount of money that China is pouring into subsidizing what will be an excess capacity of mature chips and legacy chips, that’s a problem that we need to be thinking about and working with our allies to get ahead of,” Raimondo said.

This comes after U.S. chip company executives met with top Biden administration officials, including Raimondo, to discuss China policy at the Allen and Co. conference earlier in July.

With semiconductor companies poised to benefit from $52 billion in direct subsidies, these funds are meant to address the dual challenge of manufacturing both low-end and high-end chips, according to Young.

Young brought up how supply chain issues for less advanced chips can cause delays in car manufacturing, referencing the industry in his state of Indiana – while the US needs to enhance its ability to produce advanced chips for specialized applications, such as those used in nuclear-armed submarines.

Furthermore, Young talked about how the proposed subsidies will coincide with incentives provided by the Biden administration to promote the clean energy, electric vehicle, and battery industries.

These sectors are considered critical for the economy and environment, and the government’s initiatives represent the largest industrial policy effort since World War II, said Young, with significant implications for the manufacturing sector.


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