Thursday, August 6th 2020
US Aims to Bring Chip Manufacturing Industry Back to Its Soil
The US is one of the leading countries when it comes to chip design technologies and know-how; however, when it comes to actual manufacturing those designs, it's fallen from grace in recent years. Once the leader in both design and manufacturing, nowadays the US can only claim some 12% of the world's semiconductor production. The rest of it is mainly produced in Asia, where TSMC stands as the industry juggernaut, with other companies stretching across Taiwan, Japan, and most recently (and surging) China - the country has more than doubled its 300 mm manufacturing sites since 2017. This places some strain on the US' dependence from foreign shipments; and the country is looking to bridge that gap in its perceived national interests by investing heavily in silicon manufacturing to be brought back to the country. Recent slippages from Intel when it comes to keeping its manufacturing lead have apparently also instilled preoccupation amongst US policy makers.
The US Senate and House of Representatives have recently started converging around a bill that would pour taxpayer money into domestic chip production, laying a framework for $25bn worth of direct incentives to stimulate investment in manufacturing capacity, along with advanced research. This plan has been eagerly supported by Texas Republican John Cornyn and New York Democrat Chuck Schumer - representatives of two of the US states with the highest silicon manufacturing rates. However, it's expected that incentives covering some 20% to 30% of the total cost of any new fab and development investment are required to make the US a worthwhile consideration against other, more established countries with higher incentives, existing support logistics and infrastructure, and cheaper labor.
Source:
Financial Times
61 Comments on US Aims to Bring Chip Manufacturing Industry Back to Its Soil
www.onlinecomponents.com/blogpost/261-chip-industry-impacted-by-dropped-hong-kong-preferential-treatment
Europe :
en.wikipedia.org/wiki/List_of_European_countries_by_average_wage
Sort the chart at the bottom for avg wage for by year 2018 average high to low. Look at UK, above that line is mostly western europe. UK according to this has average monthly wage of 2,389 Euro = 2830 USD in 2018 - however I suspect this number because this also says their wages droppped from a high of 3755 Euro in 2015. I haven't heard of any economic catastrophe in UK that wiped out 1/3 of their GDP or income from 2015-2018.
Everything above UK on that chart sorted by 2018 income essentially comprises western europe. They range from 3373 for Sweden to 5645 for Norway ( Euro / month ). 3373 Euro right now = $3996/month in USD which is ~$48,000 USD / year. The high for Norway of 5645 Euro = $6,687 USD / month. Both of these are significantly above the average individual income in the USA. It is only in Eastern Europe that you get really depressed wages. The average individual income in the USA in the same year 2018 was $39642. The questionable number for UK would be roughly on par with the USA about $35K usd vs $39K usd).
USA:
dqydj.com/individual-income-by-year/
Bottom line is, as far as labor cost, the income in the USA is lower than that of a western european country but higher than most of SE Asia and Eastern Europe. There are exceptions to that but that is the simplest way to look at it without getting into minutia of individual countries.
These wage issues are also overblown, I view it as disinformation from greedy corporations. Wages are rarely a big percentage of manufacturing operations costs, they are just an easy to get rid of factor. I believe it is typically 5-10% of cost to make. For all manufacuturing together, it is only 18.5% - and that is for all wages for everything. You'll never have zero wages, and my guess is even if you had literal slave labor for zero you wouldn't even get rid of even half of that cost because you still need marketing, sales, design, legal, executives and so on. Maybe if they got rid of the executives....
The biggest problem a lot of manufacturers have is the corporate tax rate. The corporate tax rate in France is 34.1%, China at 16.6%, and Taiwan at 10.1%. The USA was at 35%, and is now at 21%. Then there is regulations, and the impact that has to costs. The loss of manufacturing to Asia is not a one-dimensional problem, regardless of what self-appointed political partisans may say.
And as far as I know, there's already at least 1 fab I know of of in Ireland which is owned by Intel. You're thinking simple and you say "Trump" where it's out of context. I didn't mention anything about that.
The idea of closing borders and keeping USA out of the exterior is not new. At start of WWII, if you had paid attention to your history class, you would have known they spend half the first part of the war out of the conflict, just selling weapons....until they got attacked and responded. You know the rest.
USA was certainly not having employment problems but you weren't 400M. Now you do, and finding the equilibrium is not that easy.
And closing physical and economical borders in a globalized world don't have the same result as it had in the 30's.In Europe you work 37-39h a week, but you're supposed to get paid extra for extra hours. Except either companies won't pay you saying it's "personal development" or they will kick you from the office so you won't be able to justify extra work.
You can't have multiple full time jobs.
You can't work more than 51hours a week (by law), so even if you wish to, you can't. Not legally.
You can't do anything, except having an a-hole job which basically tells you to sell overpriced things or scrap money out of the poorest pockets (rich can protect themselves).
I agree feds stats aren't representative, it's the gov. But the gap between rich people and "normal" people is huge in the US. See the salary of a doctor in the US. Meanwhile in Europe, it's mostly flat.
I worked 70-80h a week, working from 8am to 9pm straight every working day, and at least once or twice in a week we worked until midnight or worse. Extra hours paid ? Zero, nada, niet, nischt.
I did it during 6 years, and know I can earn a decent 2k/month, and I'm pretty good at my job. Now I just need to wait, pass certifications,get always better, and grab little by little each year. If I had not done that I would be stuck very low.
I also could be a shark and go from company to company, grabing 10% at least each 2years, but I think I still have a soul, so I'll keep it by upgrading 4-6% each year in the same company (I've stopped working 70h, now I work 40-45h avg).I read the whole thing, and indeed, it could look like we live well, but you have to consider some factors :
- we have VAT at 20-22% across many european countries
- while a 40m² in France costs 500€ to rent in big cities, it's nearly 800-900€ in Ireland, and worse in UK
- all continent opposes us taxes (US, China, etc.)
- we can't get things across Europe without internal taxes, not everywhere. It's not a federal state.
- in France, as you quoted it, tax over income for income for companies is 33% (last I checked), but you forgot a big point : for every euro they pay you, they have to give at least the same amount in social taxes to the country. The money goes to : healthcare, retired people, natural catastrophes, and a bunch of complicated things.
- when you retire you only touch 70-80% of your salary if worked enough (43 years in average) : if you do less, you lose like 5% for each semester not done !! Many people have another retiring system that they pay to compensate the loss of salary, and it's around 300€ a month. Like private retirement funds in the US, but smaller.
And last but not least : if you pay your CPU 500$ it's transformed into 500€ (mostly VAT effect). Magic !!
And congrats on retiring!
"Not even comparable"??? Do you know how much suffering is going on in the EU every single day, especially with all the refugees that are living in basically death camps without any future other than more death camps? And that's not even talking about regular people in those EU countries who live on nothing and are totally left alone to die by their governments. Please..... You don't know anything about the EU.
And all richer countries in the EU wouldn't have nearly as much s**t if they didn't exploit their poorer neighbors and the refugees for slave wages. This is why seeing EU as one country is just not very smart, or at least look at EU as a whole without leaving out the poor countries. Not to do so is just as stupid as only showing the rich cities in US and ignoring all the poorer cities and areas.
It's really bizzare to me how people from US often think about EU.
I'll repeat what I said earlier:
"Arguing between USA and Europe and what is better is such wasted time. Look at the countries and what they are doing. Europe has a lot of poverty just like the USA. And Europe isn't even a country!"
bribedpoliticians with their hands out.It's actually bizzare to read some of the comments on US vs. EU here. It seems like people from US only ever notice their own problems. I know EU as a whole is way worse in this gap than US. Way worse... I just told you exactly how with examples and you still wrote your comment after that. Again, you don't know anything about EU. Go watch at least a single documentary on EU problems, please. I know it's harder to get real news from here to US, but still. People from US should know more. Just look at the working conditions of basic plant farmers in Spain.
Not directed at you, but just in the context of the whole thread:
Christine King, former CEO of SMSC (purchased by Microchip) said why should she pay a US engineer a $100,000+ salary, when she can buy up a small company in Bulgaria and get 4 engineers for the same price... She said this at an all hands meeting... This was after waves of layoffs, and after purchasing a company in Bulgaria...
So to take your statement a bit further, it is not smart to think of the whole U.S. the same either.I understand and appreciate your sentiment, which is what the like is for. On a logical note though, the U.S. is going to need some of those manufacturing jobs to return. IDK if you noticed, but most would agree our service sector sustained economy will not be coming back to what it was.
We’ll probably be back to 1980’s levels of stores and restaurants. Unless we want to have a permanent 15 to 20% unemployment rate, we should “bribe” as many corporations as possible to return at least some of their manufacturing here.
Sure, the US is good at sending people to college, but the average graduate enters the workforce with $30000 in student debt, $3-400 health insurance premiums a month, $800-$2000 for a one bedroom in most cities... We have farms, too, but they’re mostly owned by corporations and worked by migrants, whose average annual wage is typically around $12000.
The link is just about individual countries, not taking EU as a whole into account.Please visit Almeria slums in the south of Spain for me then. Many of these people live and work out of houses made from thrown away matrasses. There are whole cities like that. For years. And there is no change for them. And nobody is doing anything because they are basically just slaves to the plant farmers who make almost no money themselves because rich countries want very cheap produce... Appalachia looks like a paradise compared to that. Europe is sustained by hellholes like that, where people are almost kept as slaves. I have never seen anything comparable to that in the US. Where is the outrage? It's easier to only look at yourself and your problems. But EU is hell to many people, but you just like to sweep that under the rug somehow. You just like to talk about only your problems in the US. Maybe also understandable if I lived in US, but very misleading.
Again, US should know more about problems in EU. You would definitely feel better about your own problems. But it seems like US only likes to complain about their problems... I'm actually laughing here in EU sometimes when I compare it to our problems.
This might give you only a microscopic glimpse into the problem:
So yeah, as long as things like that exist, as long as people in my own town can only feed their family by going to the food bank here (which depends on donated food to operate), then yeah, my focus is not going to be on Almeria. It’s no different than your focus not being on anyone here.
I know how life is hard in the US, I know your laws. But better compare yourself with yourself, not with EU. We don't have the answers to your problems because EU doesn't know them, sorry. EU will keep exploiting people like slaves and people in US will have their problems, too. But elevating your problems and saying our problems don't compare is just absolutely like putting a blindfold on yourself. These are all the problems caused by corrupt politics, but there is also almost no solution for them here or there. But saying you can't compare the problems? EU must be better? It's wrong.
It however does not have any bearing on my comment, which was that it is arrogant to paint all Americans or any nationality with the same paintbrush.
I could point to parts of South America that would have the worst of America looking like slumville, if outliers is all we use. But that's silly.