US semiconductor industry gets $300M boost from CHIPS for America

The Biden-Harris Administration has announced up to $300 million in funding for advanced semiconductor packaging research projects across three states, marking a significant step in strengthening domestic semiconductor capabilities and reducing dependence on foreign manufacturing.

Core investment details: The U.S. Department of Commerce is initiating negotiations to distribute funding among three key institutions for advanced substrate development and research.

• Absolics Inc. in Georgia, Applied Materials Inc. in California, and Arizona State University are each expected to receive up to $100 million
• The federal funding will be matched with private sector investments, bringing the total investment to over $470 million
• Advanced substrates, which are not currently produced in the United States, serve as platforms for assembling multiple semiconductor chips and enabling high-performance computing

Technical significance: Advanced packaging technology represents a crucial advancement in semiconductor manufacturing that addresses current limitations in computing power and efficiency.

• The technology enables high-bandwidth communication between chips while managing power delivery and heat dissipation
• These improvements are essential for artificial intelligence, next-generation wireless communication, and power electronics
• Current packaging technology cannot meet the rising power consumption and computational performance demands of AI data centers

Project specifics: Each recipient brings unique capabilities and focus areas to advance domestic semiconductor packaging capabilities.

• Absolics Inc. will develop glass core substrate panel manufacturing through its SMART Packaging Program, collaborating with over 30 partners
• Applied Materials is focusing on silicon-core substrate technology for 3D heterogeneous integration with 10 collaborators
• Arizona State University will lead fan-out-wafer-level-processing research, working with industry partner Deca Technologies and others

Workforce development: The initiative includes comprehensive plans for building a skilled semiconductor workforce.

• Recipients will establish training programs, internships, and certification opportunities
• Partnerships with technical colleges, the HBCU CHIPS Network, and Veterans programs are planned
• Programs include microcredentials and quick start options for working professionals

Program context: This funding is part of the broader CHIPS for America initiative, which aims to revitalize U.S. semiconductor manufacturing.

• The National Advanced Packaging Manufacturing Program (NAPMP) will invest approximately $3 billion in total
• The program aims to establish a self-sustaining domestic advanced packaging industry within a decade
• These investments support both research and development and manufacturing capabilities

Looking ahead: While this investment represents a significant step toward domestic semiconductor independence, success will depend on effective execution and continued support for the ecosystem’s development, particularly as global competition in advanced chip packaging intensifies and demand for AI-capable hardware grows.