Policymakers Should Prioritize Research Investments as Appropriations Negotiations Move Forward

Monday, Jul 22, 2019, 5:55pm

by Semiconductor Industry Association

President Trump today announced the administration and congressional leaders have reached agreement on a deal to raise federal spending levels and extend the debt limit for the next two years. SIA is encouraged by this announcement and urges policymakers to prioritize research funds during the appropriations process to keep America the world leader in semiconductor technology.

Recognizing the essential role of research in driving innovation, U.S. semiconductor companies invest about one-fifth of revenue into R&D each year, regularly ranking first or second among all industries. The industry’s cumulative R&D investment last year was $39 billion. Since federal research investments tend to support long-term, leap-ahead breakthroughs, they provide a necessary complement to industry investments, which mostly focused on near-term semiconductor innovation. Federal investments in semiconductor research at the Department of Energy, the Department of Defense, the National Science Foundation, and the National Institutes of Standards and Technology provide a significant return on investment to the American taxpayer by accelerating the development of cutting-edge technologies.

In light of the importance of federal support for research, SIA last month sent a letter urging congressional leaders to triple investments in semiconductor research over the next five years to a total of $5 billion annually. The letter echoes a core recommendation of our recent policy agenda, titled “Winning the Future: A Blueprint for Sustained U.S. Leadership in Semiconductor Technology.” That report showed U.S. government investment in research has been declining in comparison to key global competitors, most notably China. It called for tripling federal investment in semiconductor research to $5 billion annually and doubling funding for semiconductor-related fields such as materials science, engineering, and applied mathematics to $40 billion annually.

Continued semiconductor innovation will require research in new materials, designs, and architectures through a whole-of-government approach and public/private partnerships to apply the best research from academia, industry, and government research centers. Congress can take a critical step toward sustaining and strengthening America’s global technology leadership by tripling federal investments in semiconductor research.

SIA looks forward to continuing to work with Congress and the Administration to support federal investments in research that will advance semiconductor technology and spur U.S. economic growth and innovation.