US government invests billions to boost domestic semiconductor production

The U.S. government is making significant investments to increase domestic semiconductor production, a critical component in nearly all modern electronics. This push comes as part of a broader effort to reduce reliance on foreign manufacturing and regain a competitive edge in this industry.

In 1990, the United States accounted for over a third of the world’s semiconductor manufacturing capacity. However, that share has declined sharply, with only 10% of global production taking place in the U.S. in 2024. Meanwhile, 83% of semiconductor manufacturing capacity is now concentrated in Asia.

In an effort to reverse this trend, the CHIPS and Science Act was passed in 2022, aimed at revitalizing the U.S. semiconductor industry. Funding from this legislation is now being used to construct three semiconductor plants, two in Texas and one in Utah.

Texas Instruments, one of the earliest pioneers in semiconductor technology, has been awarded $1.6 billion to build these facilities. The company began producing semiconductors in the 1950s. It expects to receive up to $8 billion in Treasury Department tax credits for its investment in production, along with an additional $10 million in federal funding for workforce development.

The CHIPS Act has so far allocated over $31 billion to support the expansion of semiconductor manufacturing in the U.S. This investment is expected to gradually increase the nation’s share of global semiconductor production, with predictions that U.S. capacity could rise to 14% by 2032.

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