We hope you had the chance to enjoy some lazy summer days before we all dig into end-of-the-year tasks and planning.
In this issue, we discuss the CHIPS and Science Act 64-33. The Senate passed this act on July 27th. It was swiftly followed by House passage by a vote of 243-187 the following day. Then, on August 9th, President Biden signed the measure into law.
To understand how the CHIPS and Science Act will impact the Capital Region of New York we spoke to Katie Newcombe, the Chief Economic Development Officer for Albany’s Center for Economic Growth, as well as Warren Hart, Deputy County Administrator and Director of the Greene County Department of Economic Development Tourism & Planning.
We also include other articles to expand your knowledge of this Act. We hope you find this information helpful as you continue to grow and prosper in the communities you serve.
Warm regards,
Kathleen McQuaid Holdridge
President/Founder KathodeRay Media, Inc.
The U.S. Semiconductor Boom
How Upstate New York Economic Development Leaders are Embracing the Growth of Semiconductor Production in the Region
Many areas throughout the world are finding new avenues of economic growth. Whether it’s in developing existing local businesses, attracting new businesses, or jumping on newfound competitive advantages – there’s plenty of room for expansion. Recently, the hopes for Upstate New York becoming an epicenter of semiconductor manufacturing for the country are sky high following the recent approval of the CHIPS Act by President Joe Biden.
Efforts Started Decades Ago In the mid-1990s New York officials, including then-Governor George Pataki, encouraged the development of SUNY Poly in Albany as well as what became GlobalFoundries in Saratoga County. At that time, Central New York also saw an influx of semiconductor production facilities as well.
Investments in these areas have helped parts of upstate New York amid a struggle to grow jobs and retain its population. Pataki himself pointed to efforts in the early 2000s to bring in and incentivize GlobalFoundries.
Why Cities and Towns See a Huge Economic Opportunity in the Semiconductor Bill
In Taylor, Texas, a city of 16,000 residents about 30 miles northeast of Austin, Mayor Brandt Rydell is seeing firsthand what expanded semiconductor production means to communities—and he was almost speechless in trying to describe the changes during a phone interview.
Samsung Electronics last November chose a deserted 5-million-square-meter plot of land the city never thought would bring much revenue to build a semiconductor plant, which the South Korean company said would be its biggest investment in the U.S. ever.
Now, Let’s Put the CHIPS Act Impact into a Global Perspective…
According to the SIA (Semiconductor Industry Association) in 2021, 25 fab construction and expansion projects were announced among U.S. foreign partners – Europe, South Korea, Japan, Taiwan, and Singapore. In contrast, just 4 were announced in the United States. The United States has been the long-standing global leader in this critical technology, with 45-50% share of worldwide revenue in the last 30 years. However, during this same period, U.S. share of global semiconductor manufacturing capacity has steadily eroded from 37% in 1990 to just 12% in 2020. This is a consequence of the cost of building and operating fabs in the United States relative to that of alternative locations. The ten-year total cost of ownership of a new fab located in the U.S. is 30-50% higher than in competing countries - and 40-70% of this cost is attributable to foreign government incentives.
