New Legislation Promises Boost for U.S. Semiconductor Manufacturing
Washington D.C., Thursday, 1 May 2025.
The Building Advanced Semiconductors Investment Credit Act increases investment incentives, raising credits to 35% and expanding them, boosting U.S. semiconductor industry growth and job creation.
Significant Credit Expansion
The Semiconductor Industry Association (SIA) announced today their strong support for a transformative legislative initiative that will increase the Advanced Manufacturing Investment Credit (AMIC) from 25% to 35% [1]. This 40% increase in credit rate represents a significant commitment to strengthening domestic semiconductor production. SIA President and CEO John Neuffer emphasized that this enhancement is crucial for maintaining America’s competitive edge in the global semiconductor market, particularly as the nation aims to triple its chip manufacturing capacity by 2032 [1].
Investment Landscape and Job Creation
The semiconductor industry has demonstrated remarkable growth, with over 100 new semiconductor projects announced across 28 U.S. states since 2017. These initiatives represent more than $540 billion in private investments and are projected to create and support over 500,000 American jobs [1]. However, this expansion faces significant challenges, including a projected workforce shortfall of nearly 70,000 skilled workers by the end of 2025 [2].
Global Market Pressures and Trade Dynamics
The BASIC Act’s timing is particularly crucial given the current global semiconductor landscape. Recent developments include substantial tariff implementations, with rates ranging from 10% to over 100% on semiconductor imports [2]. TSMC, which produces approximately 60% of the world’s chips and 90% of the most advanced silicon, has responded to these market pressures with a $100 billion investment commitment for U.S. manufacturing expansion, particularly focusing on advanced 3nm and 2nm production capacity in Arizona [2].
Strategic Industry Support and Future Outlook
The semiconductor industry’s future is further bolstered by the earlier introduction of the Semiconductor Technology Advancement and Research (STAR) Act in 2025, which proposes a 10-year extension of the AMIC [1]. The SIA, representing 99% of the U.S. semiconductor industry by revenue, continues to advocate for comprehensive support measures, including the renewal of the AMIC before its 2026 expiration and expansion of credits to cover critical supply chain activities [1]. This strategic support becomes increasingly vital as approximately 30% of organizations maintain a cautious stance regarding market changes, while 61% are actively seeking new suppliers [2].