CHIPS for America: a new bill tries to stimulate semiconductor manufacturing in the U.S. #makerbusiness

U.S. manufacturing is not at the relative scale it once was.

The United States had a 37% share of semiconductors and microelectronics production in 1990; today just 12% of semiconductors are manufactured in the United States.

It is in this atmosphere that many in the U.S. government and semiconductor industry are pushing for a passage of the CHIPS for America Act. Outlined in a recent Reuters article, the proposed bill would most notably manifest as tax credits (payments) in exchange for building, manufacturing, and conducting research for semiconductors in the United States.

There seems to be general bipartisan support for the bill, though there is sure to be some wrangling over the details. What would the current bill look like years down the road?

U.S. Commerce Secretary Gina Raimondo said on Monday a proposed $52 billion boost in U.S. government funding for semiconductor production and research could result in seven to 10 new U.S. factories.

The recent Foxconn fiasco in Wisconsin shows the limits of government policy, and is good to keep in mind when looking at the most optimistic projections from proponents of the bill. It is of course possible to boost the production of semiconductors in the U.S., but will this be the ticket?

When it comes to semiconductor manufacturing, the number one competitor is China, where production is relatively cheap. This is partly due to the cheapness of goods and labor, but also governmental policy — the cheapness has been maintained with intense intervention by the CCP. One way the U.S. can compete and attract manufacturing is by lowering tax burdens.

Also worth looking at is Germany. Even though its situation is a little peculiar, it’s still able to manufacture and export a ton of value, despite being a country that has a relatively high cost of production.

The stickiness of high-skilled production

China doesn’t have *the lowest* cost of labor or cost of goods in the world, but has the perfect marriage of low cost of production with high skill and high knowledge producers. The more that companies take advantage of this, the more the industry in China turns to accommodate them, and the more the relevant industrial knowledge and capacity concentrates.

In the past few years there has been much talk of a potential diversification away from China, especially during the COVID-19 pandemic, but that won’t happen overnight if it is to happen at all — relocation of such a concentrated industry is complicated and expensive. Indeed, if the U.S. is to increase its share of global semiconductor and microelectronic production, the CHIPS for America act may be a good place to start. A successful push towards investment in domestic manufacturing would lead to more entrenched infrastructure, labor, skills, etc. and thus the more expensive and complicated relocation away from the U.S. will be.

Read more information and discussion about the bill in the Reuters article here.

 


Adafruit publishes a wide range of writing and video content, including interviews and reporting on the maker market and the wider technology world. Our standards page is intended as a guide to best practices that Adafruit uses, as well as an outline of the ethical standards Adafruit aspires to. While Adafruit is not an independent journalistic institution, Adafruit strives to be a fair, informative, and positive voice within the community – check it out here: adafruit.com/editorialstandards

Join Adafruit on Mastodon

Adafruit is on Mastodon, join in! adafruit.com/mastodon

Stop breadboarding and soldering – start making immediately! Adafruit’s Circuit Playground is jam-packed with LEDs, sensors, buttons, alligator clip pads and more. Build projects with Circuit Playground in a few minutes with the drag-and-drop MakeCode programming site, learn computer science using the CS Discoveries class on code.org, jump into CircuitPython to learn Python and hardware together, TinyGO, or even use the Arduino IDE. Circuit Playground Express is the newest and best Circuit Playground board, with support for CircuitPython, MakeCode, and Arduino. It has a powerful processor, 10 NeoPixels, mini speaker, InfraRed receive and transmit, two buttons, a switch, 14 alligator clip pads, and lots of sensors: capacitive touch, IR proximity, temperature, light, motion and sound. A whole wide world of electronics and coding is waiting for you, and it fits in the palm of your hand.

Have an amazing project to share? The Electronics Show and Tell is every Wednesday at 7pm ET! To join, head over to YouTube and check out the show’s live chat – we’ll post the link there.

Join us every Wednesday night at 8pm ET for Ask an Engineer!

Join over 36,000+ makers on Adafruit’s Discord channels and be part of the community! http://adafru.it/discord

CircuitPython – The easiest way to program microcontrollers – CircuitPython.org


Maker Business — “Packaging” chips in the US

Wearables — Enclosures help fight body humidity in costumes

Electronics — Transformers: More than meets the eye!

Python for Microcontrollers — Python on Microcontrollers Newsletter: Silicon Labs introduces CircuitPython support, and more! #CircuitPython #Python #micropython @ThePSF @Raspberry_Pi

Adafruit IoT Monthly — Guardian Robot, Weather-wise Umbrella Stand, and more!

Microsoft MakeCode — MakeCode Thank You!

EYE on NPI — Maxim’s Himalaya uSLIC Step-Down Power Module #EyeOnNPI @maximintegrated @digikey

New Products – Adafruit Industries – Makers, hackers, artists, designers and engineers! — #NewProds 7/19/23 Feat. Adafruit Matrix Portal S3 CircuitPython Powered Internet Display!

Get the only spam-free daily newsletter about wearables, running a "maker business", electronic tips and more! Subscribe at AdafruitDaily.com !



No Comments

No comments yet.

Sorry, the comment form is closed at this time.