Robust federal incentives for domestic chip manufacturing would create an average of nearly 200,000 American jobs annually as fabs are built and add nearly $25 billion annually to U.S. economy.
A Semiconductor Industry Association (SIA)/Boston Consulting Group (BCG) study analyzes the benefits and vulnerabilities of the global semiconductor supply chain and recommends government actions to ensure its long-term strength and resilience. The report finds that while the current global semiconductor supply chain structure based on geographic specialization has enabled tremendous innovation, productivity, and cost savings over the last 30 years, new supply chain vulnerabilities have emerged that must be addressed by government actions, including funding incentives to boost domestic chip production and research.
The shortage is largely the result of substantial swings in demand due to the pandemic and the increased use of semiconductors in advanced vehicles. The semiconductor industry is working diligently to ramp up production to meet renewed demand, but that takes time.
A new joint report by the Semiconductor Industry Association and the Boston Consulting Group finds the U.S. government has a strategic opportunity to reverse the decades-long trajectory of declining chip manufacturing in America, strengthen national security and make our supply chains more resilient, and make our country one of the most attractive places in the world to produce semiconductors, which are the brains of modern technology.
Our country’s leadership in semiconductors is a big reason America has the world’s largest economy and most advanced technologies. The U.S. industry, however, faces a range of challenges, including the COVID-19 pandemic, rising cost of innovation, declining share of global manufacturing, and geopolitical instability.
For decades, federal government and private sector investments in semiconductor research and development (R&D) have propelled the rapid pace of innovation in the U.S. semiconductor industry, making it the global leader and spurring tremendous growth throughout the U.S. economy. This report analyzes the impact of federal investments in semiconductor R&D on U.S. economic growth, job creation, and our country’s technology leadership.
The COVID-19 pandemic highlighted the importance of information and communication technologies (ICT) in supporting essential activities in a crisis, and the role of an ever-widening range of digitized services, from commerce to education to healthcare, in building a resilient society.