Leveraging the CHIPS Program to Create Good Jobs for All Semiconductor Workers

Introduction

The COVID-19 pandemic caused huge disruptions in the global supply chains and production of microchips — critical components in everything from smartphones to washing machines to military radars.

In August 2022, Congress responded by passing the CHIPS 55 Science Act, legislation aimed at boosting domestic semiconductor production through manufacturing subsidies, workforce development, and other investments.

The Biden-Harris administration has expressed a strong commitment to maximize the benefits of the CHIPS Act as part of a broader economic plan to “invest in America, stimulate private sector investment, create good-paying jobs, make more in the United States, and revitalize communities left behind.”

Two years after passage, tens of billions of CHIPS dollars are about to start flowing to corporations for domestic production, public funds that should support good jobs for all semiconductor workers. For many top tier workers in the industry, salaries are far above the U.S. average. But workers, observers, and lawmakers have raised several concerns about working conditions — including insufficient wages, unsafe workplaces, taxing schedules, and invasive surveillance.

This report brings together publicly available information on semiconductor companies, analyses of employment data, and worker interviews to make the case that workplace conditions in the semiconductor industry must be improved — and that the CHIPS program must do more to ensure that the billions of public dollars being invested in the industry actually create the good jobs that have been promised.

Read the in-depth full report here. A summary follows.

In Workers’ Own Words

“As a single person who could not afford to live without a roommate, it worries me that my coworkers with families to support are trying to provide what they need to on the same or similar wages as me.” — Wafer fabrication operator, Analog Devices, Beaverton, Oregon

“I think [the CHIPS Act] is a farce. The money is supposed to make good family jobs and instead it’s going to line the bosses’ pockets.” — Fabrication operator, Analog Devices, Beaverton, Oregon

“Anytime anybody’s asked questions [during a forced work stoppage], like, ‘Hey, what are we supposed to do about our bills during this time?’ because we can’t just not pay our bills for two weeks, we basically get told, ‘Oh, just go to unemployment. The company’s not going to help you with that at all.’” — Production worker, Microchip Technology, Gresham, Oregon

“I have a co-worker who’s been there 23 years and they’ve nickel and dimed her the whole time. I’ve been there five, and she doesn’t make more than $1-$2 more than me an hour.” — Manufacturing technician, Micron, Manassas, Virginia

“We have hands on the product. Without us in that fab, there would not be a product to sell.” — Manufacturing technician, Micron, Manassas, Virginia

Recommendations

The administration has already taken some positive steps to ensure CHIPS-funded jobs are good jobs. For example, corporations receiving more than $150 million in CHIPS subsidies are required to submit plans to provide child care services for their manufacturing and construction workers, although questions remain about the quality of those programs. Workers involved in the construction of facilities built with CHIPs funding are guaranteed Davis-Bacon prevailing wage rates as well.

But more should be done to ensure that this innovative program meets its full potential for American workers. Our recommendations include the following…

1. Enforce the federal “Good Jobs Principles”: The Department of Commerce has taken the lead in administering the CHIPS program. They should collaborate more closely with experts at the Department of Labor to ensure that CHIPS grantees are abiding by the “Good Jobs Principles,” which Commerce and Labor co-released in 2022, and strong workforce commitments are included into the final set of terms.
2. Provide for more transparency and accountability: Commerce should include strong, transparent, and enforceable workforce commitments like minimum job creation numbers, training investments, and minimum living wages and benefits broken down by job classification. These commitments should be subject to transparent quarterly public reporting with strong certification requirements as well as clawback provisions for non-compliance. Commerce should also require chip companies to provide full transparency regarding chemicals in use.
3. Curb executive excess: The Department of Commerce should use its statutory authority to ban CHIPS recipients from engaging in stock buybacks rather than just giving preferential treatment to bids that agree to forgo them. Adding strong teeth to regulations on buybacks would help ensure that federal money flowing to semiconductor companies makes its way to employees in the form of improved wages, training, and safety measures.
4. Protect worker rights: The administration should also take steps to ensure that the right of workers to organize is not infringed on by CHIPS recipients.