Article Summary –
The federal CHIPS and Science Act is providing Hemlock Semiconductor in Saginaw County, Michigan, with $325 million to construct a high-tech manufacturing facility, marking the largest CHIPS investment in the state to date. This funding aims to bolster domestic semiconductor production, addressing the decline in U.S. semiconductor manufacturing from 37% in 1990 to 12% in 2021, and mitigating supply chain disruptions experienced during the COVID-19 pandemic. The investment is expected to create 180 permanent factory jobs and over a thousand temporary construction jobs, with additional state support of $40 million, while contrasting opinions exist on alternative strategies such as tariffs proposed by former President Trump, which economists warn could raise inflation and consumer prices.
A mid-Michigan semiconductor plant is slated to receive $325 million from the federal CHIPS and Science Act for a new high-tech manufacturing facility, as announced by Gov. Gretchen Whitmer’s office on Oct. 21. Read the announcement here.
Hemlock Semiconductor, based in Saginaw County, stands as one of only five global companies, and the sole US-based company, producing hyper-pure polysilicon. This material is pivotal for semiconductor chips, essential in electronics like cars, cell phones, medical devices, and more.
“HSC is proud to be a manufacturing powerhouse for two vital industries of the future—semiconductor and solar. Bolstered by the CHIPS Act, we are planning for a once-in-a-generation investment in advanced technologies to continue serving as a top polysilicon supplier to the leading-edge semiconductor market,” stated Hemlock Semiconductor CEO and Chairman AB Ghosh.
The CHIPS and Science Act, signed by President Biden in 2022, aims to enhance domestic semiconductor research and production.
In 2021, the US represented just 12% of global semiconductor manufacturing, down from 37% in 1990, as per the Semiconductor Industry Association. The pandemic highlighted the US dependency on overseas production when vehicle manufacturing halted and electronics prices surged because of global supply chain disruptions and chip shortages.
In August, the White House stated the CHIPS Act has driven nearly $400 billion in semiconductor investments nationally, creating over 115,000 jobs.
Vice President Kamala Harris highlighted the significance of investing in future industries and supporting traditional sectors during her Hemlock plant tour on Oct. 28, according to PBS News reported. The new investment is expected to foster 180 permanent factory jobs and over a thousand construction jobs in Michigan.
Former President Donald Trump criticized the CHIPS Act recently on “The Joe Rogan Experience” podcast, proposing that tariffs on imported semiconductors could attract foreign companies to build US facilities without federal funding. Trump remarked: “You didn’t have to put up 10 cents. You tariff it so high that they will come and build their chip companies for nothing.”
Economists argue that Trump’s tariff proposals on all US imports would increase inflation and raise consumer prices.
The $325 million allocation for Hemlock is Michigan’s largest CHIPS investment to date. In total, Michigan has received nearly $1.5 billion for semiconductor and electronics manufacturing, with an additional $40 million coming from the state for the new Hemlock facility.
“Together, we are strengthening national and economic security by ensuring supply chains, good-paying jobs, and cutting-edge investments are where they belong—here at home,” Whitmer declared.
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