Coalition Calls on Congress to Invest in Domestic Semiconductor Manufacturing, Research, Design

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The Semiconductor Industry Association (SIA) – along with a broad coalition of 19 other tech, auto, medical, defense, and other business and labor groups – in a letter urged Congress to enact funding for the semiconductor manufacturing, research, and design initiatives authorized in the “Creating Helpful Incentives for the Production of Semiconductors” (CHIPS) for America Act. The Senate on June 8 approved $52 billion in funding for CHIPS as part of the U.S. Innovation and Competition Act (USICA), but the House has not yet approved such funding.

The coalition’s letter also calls on leaders in Washington to enact an investment tax credit, as provided in the Facilitating American-Built Semiconductors (FABS) Act, to help build and modernize semiconductor manufacturing facilities in the United States.

“Semiconductors are central to America’s economy, national security, and global leadership in strategic technologies, so investing in domestic chip production and innovation is a national priority,” said John Neuffer, SIA president and CEO. “Our message to Congress is simple: America and the world need more semiconductors. Let’s make more of them on U.S. shores. The U.S. Senate has taken a big step forward by approving – with broad, bipartisan support – $52 billion in funding to strengthen U.S. semiconductor manufacturing, research, and design. Now, the House and Senate must chart a path forward to send legislation to President Biden’s desk to be signed into law.”

The share of global semiconductor manufacturing capacity in the U.S. has decreased from 37% in 1990 to 12% today, according to a report by SIA and the Boston Consulting Group (BCG). This decline is largely due to substantial subsidies offered by the governments of our global competitors, placing the U.S. at a competitive disadvantage in attracting new construction of semiconductor manufacturing facilities, or “fabs.” Additionally, federal investment in semiconductor research has remained flat as a share of GDP, while other governments have invested substantially in research initiatives to strengthen their own semiconductor capabilities, and existing U.S. tax incentives for R&D lag behind those of other countries. Furthermore, global semiconductor supply chain vulnerabilities have emerged in recent years that must be addressed through government investments in chip manufacturing and research, according to a separate SIA-BCG study. 

The following groups, representing major sectors of the American economy and millions of U.S. workers, signed today’s letter: AdvaMed – Advanced Medical Technology Association, Alliance for Automotive Innovation, American Automotive Policy Council, Autos Drive America, Information Technology Industry Council (ITI), IPC, Motor & Equipment Manufacturers Association (MEMA), National Association of Manufacturers (NAM), National Defense Industrial Association (NDIA), North America’s Building Trades Unions (NABTU), SEMI, Semiconductor Industry Association (SIA), Software & Information Industry Association (SIIA), Tech CEO Council, TechNet, Telecommunications Industry Association (TIA), Truck & Engine Manufacturers Association, United Auto Workers (UAW), U.S. Chamber of Commerce, and USTelecom – The Broadband Association.