{"id":2820,"date":"2024-06-17T20:24:46","date_gmt":"2024-06-17T20:24:46","guid":{"rendered":"https:\/\/partstack.com\/blog\/?p=2820"},"modified":"2024-06-18T12:31:56","modified_gmt":"2024-06-18T12:31:56","slug":"semiconductor-industry-growth-us-triples-manufacturing-capacity-2032","status":"publish","type":"post","link":"https:\/\/partstack.com\/blog\/semiconductor-industry-growth-us-triples-manufacturing-capacity-2032\/","title":{"rendered":"America Set to Triple Semiconductor Manufacturing Capacity by 2032: Leading Global Growth"},"content":{"rendered":"

In the era of digitalization, the demand for semiconductors<\/a> has skyrocketed. As per the Semiconductor Industry Association (SIA), the semiconductor industry “shipped a record 1.15 trillion semiconductor units in 2021.” The total estimated value of these units was $555.9 billion. This exponential growth emphasizes the pivotal role of semiconductor industry, often referred to as the \u2018brains of modern electronics.\u2019 Over the past 50 years, they have enabled electronic gadgets to become quicker, smaller, and more reliable. They can now power smartphones and laptops.<\/p>\n

In a similar vein, semiconductors are the brains behind contemporary electronics, allowing technologies essential to national security, economic success, and U.S. competitiveness in the world market.<\/p>\n

State of the US Semiconductor Industry in the Recent Past<\/h2>\n

Countries all around the globe have been increasing government funding in an attempt to entice the growth of the semiconductor industry, innovation, and manufacturing within their borders as chip demand grows. To tackle this situation, the U.S. government took action in 2022<\/a>. It<\/u> passed the historic CHIPS and Science Act<\/a>, which strengthened the nation’s supply chains, economy, and national security by providing industrial incentives and funding for semiconductor research.<\/p>\n

Global corporations have reacted positively to the introduction of the CHIPS Act, announcing dozens of new semiconductor ecosystem projects in the United States that would need well over $200 billion in private capital. In addition to supporting hundreds of thousands of extra employment throughout the U.S. economy, these initiatives will generate tens of thousands of new jobs in the semiconductor ecosystem. Starting in 2023<\/a>, the CHIPS Act is being implemented in earnest. The SIA aims to contribute positively to the law’s implementation in order to maximize its advantages for the US economy, national security, and supply chain resilience.<\/p>\n

Introduction of the SIA-BCG Report<\/h2>\n

The Semiconductor Industry Association (SIA) and the Boston Consulting Group (BCG) joined forces on May 9th, 2024, to conduct a thorough analysis of the worldwide chip supply chain. According to this research, the capacity of domestic U.S. chip manufacturing is expected to rise thrice by 2032. Commencing in 2022 with the enactment of the CHIPS and Science Act, this noteworthy increase signifies an astounding 203% rise. Within this time frame, stakeholders expect this spike to represent the largest percentage increase globally, providing them with a credible and reliable projection.<\/p>\n

Projected Growth and Global Impact of Semiconductor Industry<\/h2>\n

The “Emerging Resilience in the Semiconductor Supply Chain<\/a>” study anticipates significant semiconductor industry growth in the United States. It predicts that by 2032, the US will account for 28% of the world’s capacity for advanced logic manufacture (below 10nm), a substantial increase from 0% in 2022. Furthermore, from 2024 to 2032, the United States is predicted to receive 28% of all capital expenditures (capex) worldwide, behind only Taiwan, which is slated to get 31%. According to the results, the United States would have only attained 9% of global capital expenditure by 2032 if not for the CHIPS Act.<\/p>\n

\"GraphFigure 1:Global semiconductor capacity increase by location<\/p>\n

Industry Investments and CHIPS Incentives<\/h2>\n

It highlights how industry investments, supported by CHIPS incentives, have the potential to boost local chip supply chains and revive semiconductor manufacturing in the United States. It also describes legislative steps intended to strengthen supply chains, advance research & development and chip design, increase employment opportunities in the semiconductor industry, and guarantee that the CHIPS Act maximizes its advantages for the economic and national security of the United States, instilling confidence in its potential.<\/p>\n

Risks and Recommendations for Policy Measures<\/h2>\n

Potential risks associated with industrial policies that unintentionally create bottlenecks and increase supply chain vulnerabilities. It’s important to be cautious of non-market-based investments that come from incentive programs and large-scale industrial policies, as these can lead to overconcentration or oversupply in certain parts of the semiconductor supply chain. Instead, government incentives should focus on promoting targeted, distributed, and market-based investments.<\/p>\n