by Robert Casanova, Director, Industry Statistics and Economic Policy
The Semiconductor Industry Association (SIA) today released its annual State of the Industry Report. The report highlights the current challenges facing the semiconductor industry, as well as opportunities for continued growth and innovation.
In 2022, with the importance of semiconductors to the global economy continuing to grow, the semiconductor industry has worked tirelessly to speed the pace of innovation and ramp up production. In fact, the global industry is on pace to ship more semiconductors this year than during any year in history, an achievement that has helped ease the ongoing global chip shortage.
This year also saw the enactment of landmark, bipartisan legislation, the CHIPS and Science Act, that will substantially strengthen domestic semiconductor production and innovation in the years ahead. The CHIPS Act includes $52 billion in chip manufacturing incentives and research investments, as well as an investment tax credit for semiconductor manufacturing and semiconductor equipment manufacturing. These investments will help reinvigorate U.S. leadership in chip technology and reinforce America’s economy, national security, and supply chains.
Despite an historic year in 2022, the semiconductor industry continues to face significant challenges. Global semiconductor sales growth slowed substantially during the second half of the year, for example, and the market—known for its cyclicality—is not projected to rebound until the second half of 2023. In addition, U.S.-China tensions continue to have repercussions on the global supply chain, leading to the proliferation of government controls on sales of chips to China, the world’s largest semiconductor market. And other significant policy challenges remain, including the need to enact policies to maintain U.S. leadership in semiconductor design, reform America’s high-skilled immigration and STEM education systems, and promote free trade and access to global markets.
Overall, 2022 was a highly successful and consequential year for the industry, as semiconductors are poised to have a greater positive impact on the world than ever. With effective government-industry collaboration in the years ahead, the industry can continue to grow, innovate, and realize an even brighter future built on semiconductors.
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