Biden Administration Signs CHIPS and Science Act to Increase Domestic Semiconductor Manufacturing In Response to Recent Shortages

A researcher examining a piece of chip

In August 2022, President Biden signed into law the CHIPS and Science Act, which provides over $52 billion to increase domestic semiconductor research, development, and manufacturing. The law was in response to the recent shortage of semiconductors as a result of the economic instability caused by the global pandemic. Following the act, several companies have invested nearly $50 billion more in semiconductor manufacturing, including Micron, Qualcomm, and Global Foundries. 

The CHIPS and Science Act is a major move the Biden Administration is taking to boost the United States’ leadership in semiconductor manufacturing, which is crucial in everything from cars to computers to weapons. In the last thirty years, the United States’ production of semiconductors sank from 37 percent to 12 percent of global production. East Asia currently produces over 75 percent of semiconductors around the world, and Taiwan leads with over 92 percent of advanced semiconductor manufacturing gloablly. As tensions with China and concerns over an invasion of Taiwan increase, the need to invest in domestic semiconductor manufacturing and create an independent source of semiconductors has grown even further. 

However, there have also been concerns over the downsides that come with government investment in private-sector companies and the chances that increased semiconductor manufacturing will not be able to counter the current shortage. In response, the Commerce Department has said they will review any companies that receive funding from the bill to ensure that the money is not used to benefit the company’s investors.

By Angeline Zhao

Leave a Reply