WASHINGTON – The Semiconductor Industry Association today released the following statement from president and CEO John Neuffer in support of a recent letter from top national security leaders to President Biden urging enactment of legislation to strengthen America’s technological edge, including federal investments in domestic semiconductor manufacturing and research called for in the CHIPS for America Act and the Endless Frontier Act:

“A key part of strengthening US national security is ensuring America’s global leadership in semiconductors, which are essential to a range of critical defense applications. SIA joins defense and intelligence leaders in calling on President Biden and Congress to enact and fund legislation to bolster America’s global technology leadership and semiconductor supply chains through federal investments in domestic chip manufacturing and research. Funding the CHIPS for America Act and enacting the Endless Frontier Act will help ensure more of the semiconductors our country needs are produced on US soil, while also promoting America’s leadership in the strategically important technologies of today and tomorrow.”

The share of global semiconductor manufacturing capacity in the US decreased from 37% in 1990 to 12% today, according to a recent report from SIA and the Boston Consulting Group. This decline is largely due to substantial subsidies offered by the governments of global competitors, placing the US at a competitive disadvantage in attracting new construction of semiconductor manufacturing facilities (fabs). Additionally, federal investment in semiconductor research has been flat as a share of GDP, while other governments have invested substantially in research initiatives to strengthen their own semiconductor capabilities.

Recognizing the critical role semiconductors play in America’s future, Congress in January enacted the CHIPS for America Act as part of the 2021 National Defense Authorization Act. The new law calls for incentives for domestic semiconductor manufacturing and investments in chip research, but funding must be provided to make these provisions a reality, SIA says.

The SIA/BCG report found a $50 billion federal investment in domestic semiconductor manufacturing incentives would reverse the trajectory of declining chip production in America and create as many as 19 major fabs and 70,000 direct high-paying jobs in the US over the next 10 years, which, by SIA calculations, could create an additional 350,000 indirect jobs throughout the economy.

President Biden has called for $50 billion to fund the semiconductor manufacturing and research provisions in the CHIPS for America Act. In February, the SIA board of directors called on President Biden to work with Congress to fund the semiconductor manufacturing incentives and research initiatives.

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