America's chipmaking push will continue no matter who gets elected --[Reported by Umva mag]

• US efforts to produce semiconductor chips will continue regardless of who wins the election.
• Harris and Trump think domestic chip production is key for economic and national security reasons.
• Policy differences on taxes and immigration could impact the semiconductor industry.

No matter who wins the presidential election this November, President Joe Biden can rest easy knowing one thing: The US's chip manufacturing push isn't going anywhere.

Four industry experts told Business Insider that the Biden administration's efforts to boost the domestic production of semiconductor chips that power everything from iPhones to cars are likely to continue regardless of whether Vice President Kamala Harris or former President Donald Trump is sworn into office this January.

"I don't think there's going to be a considerable change in approach whether it becomes a Harris or Trump 2.0 administration," Stephen Ezell, vice president for global innovation policy at the Information Technology and Innovation Foundation and director of ITIF's Center for Life Sciences Innovation, told BI.

While the semiconductor industry hasn't been a prominent campaign topic this election season, its future has ramifications for both national security and the economy, particularly in the swing state of Arizona. Both candidates have supported investments in US chip manufacturing; however, experts told BI their approaches might differ given their differences in ideologies.

Harris' campaign website says that as president, she would build upon the Biden administration's progress and "support American leadership in semiconductors." While the Republican platform posted on Trump's campaign website doesn't specifically mention the semiconductor industry, it calls for a "resurgence of American manufacturing." In the September debate, Trump voiced frustration about the decline in US chip manufacturing in recent decades.

When reached for comment, RNC spokesperson Anna Kelly said: "In his first term, President Trump lowered taxes for American manufacturers that produced goods in the USA and imposed tariffs to level the playing field for American companies." However, Kelly did not answer specific questions about what semiconductor policies Trump would support if he were reelected.

The Harris campaign did not respond to a request for comment.

Boosting US chip manufacturing is all about reducing threats from China

In 2022, Biden signed the CHIPS and Science Act into law, which provided $52.7 billion for American semiconductor research, development, manufacturing, and workforce development. This included $39 billion in manufacturing incentives for chip production in the US that spurred the construction of factories across the country.

Much of this investment has flowed to the key swing state of Arizona, where over 16,000 semiconductor industry jobs were created since 2020 and thousands more are expected to be generated in the years to come. Phoenix is home to roughly 80 semiconductor companies, including two of the largest chip manufacturers in the world: Intel and TSMC.

The Biden administration's efforts may not persuade Arizonans to vote for Harris; recent polls show Trump with a narrow lead in the state. But regardless of whether Harris and Trump come out on top, Arizona should continue to reap the economic benefits.

In part, that's because most of the $39 billion in CHIPS Act incentives have already been allocated to specific companies and projects, experts told BI. And while much of that money has yet to be disbursed — it's doled out over time when companies hit certain construction and manufacturing milestones — both Harris and Trump are expected to generally stay the course.

"I suspect that either presidential candidate would continue to support the domestic semiconductor manufacturing base," Chris Miller, a nonresident senior fellow who focuses on semiconductors at the American Enterprise Institute and author of "Chip War: The Fight for the World's Most Critical Technology," told BI.

The Biden administration is betting that boosting domestic chip manufacturing will create American jobs and help the US avoid the type of chip shortage that wreaked havoc on supply chains during the pandemic. It could also make the US less reliant on chips sourced abroad by companies like TSMC, which produces an estimated 90% of the world's advanced chips. TSMC is based in Taiwan, which faces the potential threat of a Chinese invasion. There is also concern that China — which has invested heavily in chip production — could gain an edge in the vital industry. The US has seen its share of overall chip production fall from 37% of the world's supply in 1990 to 12%.

According to Mark Muro, a senior fellow at Brookings Metro, the CHIPS Act received bipartisan support in part because both parties want to prevent China from gaining a technological edge in sectors like AI.

"Both Harris and Trump basically agree that China is a serious threat to our technology future and that reshoring significant chip production is a critical national security priority," he said. "So all of that is good for continuity."

While many factories remain under construction, the federal funding has already helped boost US chip production. TSMC, the world's leading chipmaker, has begun making chips for Apple at one of its Phoenix factories, two people familiar with the matter told Business Insider.

Both candidates are also expected to continue the export controls the Biden administration implemented, which were intended to keep US-developed chip technology from companies like Nvidia out of China.

To be sure, experts told BI that it's difficult to forecast which semiconductor-related policies Harris or Trump would pursue as president and congressional support would often be required to take action.

How Trump and Harris might disagree on semiconductors

Harris and Trump's approaches to continuing US chip production could differ in some ways.

For one, there's the question of whether the semiconductor industry will receive additional funding through a second CHIPS Act, which some government representatives think the country needs to solidify itself in the global semiconductor market.

"The CHIPS Act is too small to ensure national security," Dylan Patel, a chief analyst at the semiconductor research and consulting firm SemiAnalysis, told BI.

Ultimately, it will be Congress — not the next president — that dictates whether additional legislation is passed. However, experts told BI that Harris would be more likely to push for this.

"A Harris administration would probably be more likely to advance a CHIPS Act 2.0, just given the Democratic party's general endorsement of industrial policy and willingness to invest significant sums to support industrial policy," Ezell said. "A Trump administration would probably not be opposed to a CHIPS Act 2.0, but it would probably be less likely to instigate one."

There could also be differences when it comes to tax policy. Ezell said some semiconductor industry manufacturing incentives — including a 25% investment tax credit that's part of the CHIPS Act — expire in 2026. While congressional approval would be required to extend the credit, Ezell said Trump — who has generally supported lower taxes for corporations — may be more likely to support such a move.

Trump is also more likely to push for a lower corporate tax rate that would boost profits for US businesses — including semiconductor companies.

Differences in immigration policy could also impact semiconductor firms. According to a report published last year by the trade and lobbying group Semiconductor Industry Association and Oxford Economics, the US semiconductor industry will face a shortage of 67,000 workers by 2030, including technicians, computer scientists, and engineers. Immigration could be one way to help fill this gap.

While Trump has generally backed more restrictive immigration policies than Harris, experts told BI that both candidates have supported using immigration as a tool to address some domestic workforce needs.

"The current moment is an opportunity to create hundreds of thousands of new quality jobs, but it could be depressed by the addition of more barriers to immigration — whether high-skill or lower-skill," Muro said.

Do you work in the semiconductor chip industry and have a story to tell? Reach out to this reporter at jzinkula@businessinsider.com.

The following news has been carefully analyzed, curated, and compiled by Umva Mag from a diverse range of people, sources, and reputable platforms. Our editorial team strives to ensure the accuracy and reliability of the information we provide. By combining insights from multiple perspectives, we aim to offer a well-rounded and comprehensive understanding of the events and stories that shape our world. Umva Mag values transparency, accountability, and journalistic integrity, ensuring that each piece of content is delivered with the utmost professionalism.