semiconductor industry

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Biden rushes to avert labor shortage with CHIPS act funding for workers

Less than one month to apply —

To dodge labor shortage, US finally aims CHIPS Act funding at training workers.

US President Joe Biden (C) speaks during a tour of the TSMC Semiconductor Manufacturing Facility in Phoenix, Arizona, on December 6, 2022.

Enlarge / US President Joe Biden (C) speaks during a tour of the TSMC Semiconductor Manufacturing Facility in Phoenix, Arizona, on December 6, 2022.

In the hopes of dodging a significant projected worker shortage in the next few years, the Biden administration will finally start funding workforce development projects to support America’s ambitions to become the world’s leading chipmaker through historic CHIPS and Science Act investments.

The Workforce Partner Alliance (WFPA) will be established through the CHIPS Act’s first round of funding focused on workers, officials confirmed in a press release. The program is designed to “focus on closing workforce and skills gaps in the US for researchers, engineers, and technicians across semiconductor design, manufacturing, and production,” a program requirements page said.

Bloomberg reported that the US risks a technician shortage reaching 90,000 by 2030. This differs slightly from Natcast’s forecast, which found that out of “238,000 jobs the industry is projected to create by 2030,” the semiconductor industry “will be unable to fill more than 67,000.”

Whatever the industry demand will actually be, with a projected tens of thousands of jobs needing to be filled just as the country is hoping to produce more chips than ever, the Biden administration is hoping to quickly train enough workers to fill openings for “researchers, engineers, and technicians across semiconductor design, manufacturing, and production,” a WFPA site said.

To do this, a “wide range of workforce solution providers” are encouraged to submit “high-impact” WFPA project proposals that can be completed within two years, with total budgets of between $500,000 and $2 million per award, the press release said.

Examples of “evidence-based workforce development strategies and methodologies that may be considered for this program” include registered apprenticeship and pre-apprenticeship programs, colleges or universities offering semiconductor industry-relevant degrees, programs combining on-the-job training with effective education or mentorship, and “experiential learning opportunities such as co-ops, externships, internships, or capstone projects.” While programs supporting construction activities will not be considered, programs designed to “reduce barriers” to entry in the semiconductor industry can use funding to support workers’ training, such as for providing childcare or transportation for workers.

“Making investments in the US semiconductor workforce is an opportunity to serve underserved communities, to connect individuals to good-paying sustainable jobs across the country, and to develop a robust workforce ecosystem that supports an industry essential to the national and economic security of the US,” Natcast said.

Between four to 10 projects will be selected, providing opportunities for “established programs with a track record of success seeking to scale,” as well as for newer programs “that meet a previously unaddressed need, opportunity, or theory of change” to be launched or substantially expanded.

The deadline to apply for funding is July 26, which gives applicants less than one month to get their proposals together. Applicants must have a presence in the US but can include for-profit organizations, accredited education institutions, training programs, state and local government agencies, and nonprofit organizations, Natcast’s eligibility requirements said.

Natcast—the nonprofit entity created to operate the National Semiconductor Technology Center Consortium—will manage the WFPA. An FAQ will be provided soon, Natcast said, but in the meantime, the agency is giving a brief window to submit questions about the program. Curious applicants can send questions to [email protected] until 11: 59 pm ET on July 9.

Awardees will be notified by early fall, Natcast said.

Planning the future of US chip workforce

In Natcast’s press release, Deirdre Hanford, Natcast’s CEO, said that the WFPA will “accelerate progress in the US semiconductor industry by tackling its most critical challenges, including the need for a highly skilled workforce that can meet the evolving demands of the industry.”

And the senior manager of Natcast’s workforce development programs, Michael Barnes, said that the WFPA will be critical to accelerating the industry’s growth in the US.

“It is imperative that we develop a domestic semiconductor workforce ecosystem that can support the industry’s anticipated growth and strengthen American national security, economic prosperity, and global competitiveness,” Barnes said.

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India’s plan to let 1998 digital trade deal expire may worsen chip shortage

India’s plan to let 1998 digital trade deal expire may worsen chip shortage

India’s plan to let a moratorium on imposing customs duties on cross-border digital e-commerce transactions expire may end up hurting India’s more ambitious plans to become a global chip leader in the next five years, Reuters reported.

It could also worsen the global chip shortage by spiking semiconductor industry costs at a time when many governments worldwide are investing heavily in expanding domestic chip supplies in efforts to keep up with rapidly advancing technologies.

Early next week, world leaders will convene at a World Trade Organization (WTO) meeting, just before the deadline to extend the moratorium hits in March. In place since 1998, the moratorium has been renewed every two years since—but India has grown concerned that it’s losing significant revenues from not imposing taxes as demand rises for its digital goods, like movies, e-books, or games.

Hoping to change India’s mind, a global consortium of semiconductor industry associations known as the World Semiconductor Council (WSC) sent a letter to Indian Prime Minister Narendra Modi on Thursday.

Reuters reviewed the letter, reporting that the WSC warned Modi that ending the moratorium “would mean tariffs on digital e-commerce and an innumerable number of transfers of chip design data across countries, raising costs and worsening chip shortages.”

Pointing to Modi’s $10 billion semiconductor incentive package—which Modi has said is designed to advance India’s industry through “giant leaps” in its mission to become a technology superpower—the WSC cautioned Modi that pushing for customs duties may dash those global chip leader dreams.

Studies suggest that India should be offering tax incentives, not potentially threatening to impose duties on chip design data. That includes a study from earlier this year, released after the Semiconductor Industry Association and the India Electronics and Semiconductor Association commissioned a report from the Information Technology and Innovation Foundation (ITIF).

ITIF’s goal was to evaluate “India’s existing semiconductor ecosystem and policy frameworks” and offer “recommendations to facilitate longer-term strategic development of complementary semiconductor ecosystems in the US and India,” a press release said, partly in order to “deepen commercial ties” between the countries. The Prime Minister’s Office (PMO) has also reported a similar goal to deepen commercial ties with the European Union.

Among recommendations to “strengthen India’s semiconductor competitiveness,” ITIF’s report encouraged India to advance cooperation with the US and introduce policy reforms that “lower the cost of doing business for semiconductor companies in India”—by “offering tax breaks to chip companies” and “expediting clearance times for goods entering the country.”

Because the duties could spike chip industry costs at a time when global cross-border data transmissions are expected to reach $11 trillion by 2025, WSC wrote, the duties may “impede India’s efforts to advance its semiconductor industry and attract semiconductor investment,” which could negatively impact “more than 20 percent of the world’s semiconductor design workforce,” which is based in India.

The prime minister’s office did not immediately respond to Ars’ request to comment.

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