Lead or lag: The US imperative in the global chip race

This is an excerpt from the report: Lead or Lag: The US Imperative in the Global Chip Race, produced by IPC, USA, and TechSearch International.

Path forward
Significant US investment is underway, and to achieve national objectives, it is essential to continue the effort. Investment and incentives by other governments will continue. Without continued investment, the U S domestic industry will fall behind In order to achieve the goals of the CHIPS Act, it is also essential to monitor funding to provide accountability. 

Additional funding may be required on the back-end to secure the supply chain and promote small businesses. Specific funding may be required to enable an efficient supply chain and plug holes in the semiconductor and electronics manufacturing ecosystems. 

Grants may be needed and should be contingent upon meeting manufacturing ecosystem commitments. Permitting should be streamlined and non-manufacturing requirements removed. Specific attention should be given to potential shortages such as the looming advanced substrate capacity shortfall projected in the next few years.

Conclusions

Nations around the world recognize the importance of advancing their semiconductor industries and are increasing the funding to do so. Advancing the US semiconductor industry and building the ecosystem to support it is essential in securing global leadership for the future. 

The US remains a global leader in semiconductor design and the development of EDA tools but does not have a leadership role in semiconductor manufacturing. R&D investment is important in regaining this leadership position because it is the root of the manufacturing tree R&D funding coupled with tax credits are essential to creating a sustainable manufacturing ecosystem.

While President Donald Trump has been critical of the CHIPS Act, including in his March 2025 address to Congress, he has consistently emphasized his commitment to bolstering US semiconductor leadership. To this end, the administration’s actions indicate a shift towards restructuring and optimizing the program, not ending it. 

In addition to reviewing CHIPS Act awards, the administration has established the US Investment Accelerator within the Department of Commerce. The Investment Accelerator is charged with streamlining regulatory processes and expediting large-scale investments in excess of $1 billion.

The Accelerator now overseas the CHIPS Program Office to ensure that the program aligns with the administration’s objectives of fiscal responsibility and national security.

The fate of the CHIPS Act carries both immediate and long-term implications. As this paper outlines, the semiconductor industry is making historic investments in US manufacturing—but these investments depend on, or anticipate, strong government support. Ensuring that high-quality projects receive the funding they need will send a powerful, long-term message worldwide: The United States has the political will and bipartisan resolve to fulfill the promise of the CHIPS Act.

-- Source: IPC, USA and TechSearch International.