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Transformative Legislation: CHIPS & Science Act Set to Supercharge U.S. Innovation & Economic Growth

Updated: Dec 3, 2023

In a significant milestone for U.S. economic and technological advancement, President Biden is set to sign the bipartisan CHIPS and Science Act of 2022 into law. This groundbreaking legislation is poised to not only lower costs and create jobs but also fortify supply chains and position the United States as a global leader in the industries of tomorrow.

In the inaugural year of the Biden-Harris Administration, a strategic focus on revitalizing domestic manufacturing and fostering a climate for innovation has yielded remarkable results. With the implementation of policies aimed at bolstering American industries, the manufacturing sector has experienced an unprecedented resurgence, adding an impressive 642,000 jobs since 2021. Companies are reinvesting in the United States, leading to a remarkable 116 percent increase in the construction of new manufacturing facilities

The CHIPS and Science Act builds upon this momentum, marking a historic investment that will equip American workers, communities, and businesses to thrive in the 21st century. The legislation addresses critical areas such as American manufacturing, supply chains, national security, and research and development in key sectors like nanotechnology, clean energy, quantum computing, and artificial intelligence. It represents a strategic move to ensure the United States remains at the forefront of cutting-edge industries.

As a direct result of the CHIPS and Science Act, companies have announced nearly $50 billion in additional investments in American semiconductor manufacturing this week alone, bringing the total business investment to almost $150 billion since President Biden assumed office.

Major investments include Micron's commitment of $40 billion to memory chip manufacturing, set to create up to 40,000 new jobs in construction and manufacturing. This investment is expected to elevate the U.S. market share of memory chip production from less than 2 percent to up to 10 percent in the next decade. Additionally, Qualcomm and GlobalFoundries are forming a partnership with a $4.2 billion investment to expand semiconductor production in upstate New York, aiming for a 50 percent increase in semiconductor production in the U.S. over the next five years.

The CHIPS and Science Act plays a pivotal role in advancing American semiconductor research, development, and production. With the U.S. currently producing only about 10 percent of the world's semiconductor supply, this legislation aims to unlock private sector investments exceeding hundreds of billions across the country, including essential production for national defense and critical sectors.

Beyond semiconductors, the law ensures the United States maintains its scientific and technological edge by investing in research and development. With a focus on inclusivity, the CHIPS and Science Act aims to bring economic growth and prosperity to all regions of the country, unlocking opportunities in science and technology for historically marginalized communities.

To expedite the responsible deployment of CHIPS and Science Act funding, the Biden-Harris Administration has taken strategic actions. This includes the launch of a sector-specific interagency expert working group to address permitting issues for high-tech manufacturing. Additionally, the President's Council of Advisors on Science and Technology (PCAST) has released recommendations to maximize the impact of the legislation, covering areas such as semiconductor workforce development, innovation, and national research agendas.

The CHIPS and Science Act, with a budget of $52.7 billion, is set to bolster U.S. leadership in semiconductors through manufacturing incentives, research and development, and workforce development. The legislation includes strong guardrails to ensure equitable economic growth, preventing certain facilities from being built in countries of concern and limiting the use of taxpayer funds for stock buybacks and dividends.

Notably, the Act promotes U.S. innovation in wireless supply chains with a $1.5 billion investment and advances U.S. global leadership in emerging technologies. It establishes a technology, innovation, and partnerships directorate at the National Science Foundation, ensuring that inventions in America translate to domestic production.

Moreover, the legislation authorizes $10 billion to invest in regional innovation and technology hubs, fostering job creation and economic development. With a focus on STEM education and workforce development, the CHIPS and Science Act aims to provide opportunities for individuals from all backgrounds, ensuring a diverse and inclusive STEM ecosystem that benefits all of America.

In summary, the CHIPS and Science Act is a transformative piece of legislation that addresses critical gaps in U.S. innovation and economic growth. With strategic investments and comprehensive measures, it positions the United States to not only compete but emerge as a leader in the industries defining the future.

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