Close up of a semiconductor representing the Biden Administration's plan to combat the chip worker shortage

Chipmakers in the United States are grappling with a shortage of trained personnel, hindering their ability to keep pace with escalating demand. Consequently, the Biden administration unveiled a plan on Friday aimed at addressing this challenge.

The White House announced an investment exceeding $5 billion into a public-private consortium for advancing advanced computer chip research. This investment aims to drive research and development in the field. As a result, the initiative centers on establishing the National Semiconductor Technology Center (NSTC) with substantial funding. This center aims to create a “Workforce Center of Excellence.” This center aims to foster the training of semiconductor engineers across various regions of the country.

Commerce Secretary Gina Raimondo stressed the critical need for a skilled workforce in the semiconductor industry. She highlighted the industry’s reliance on it for success. The shortage of trained personnel has emerged as a major obstacle, impacting not only the expansion of chip manufacturing within the U.S. but also President Biden’s reelection prospects.

Previously, the responsibility for workforce training largely rested with state and local governments, as well as individual companies. However, experts warned that these efforts would likely fall short, necessitating more robust policy interventions. With immigration avenues limited by the political climate, the focus has consequently shifted towards domestic training initiatives.

Arizona, poised to become a hub for the U.S. chip sector, has already encountered labor challenges. The Taiwan Semiconductor Manufacturing Company (TSMC) cited worker shortages when announcing a delay in the launch of its fabrication plant in Phoenix. Similarly, Intel has slowed construction on its Ohio plant due to market conditions and administrative hurdles.

The White House’s plan introduces new programs and leverages existing local initiatives to strengthen education and training in the field. Its aim is to bolster education and training opportunities in the field. Efforts will be directed towards supporting both manufacturing capacity and research and development.

This initiative is part of broader efforts to reverse the decline of the U.S. semiconductor industry, which has seen its global market share dwindle over the past few decades. Despite the significance of the plants under construction, which aim to reclaim domestic semiconductor manufacturing, workforce challenges loom large.

The CHIPS and Science Act, signed into law in August 2022, allocated $50 billion for the semiconductor sector, with a substantial portion earmarked for manufacturers as well as research and design purposes.