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Biden Admin Grants $8.3B to Boost US Chip Manufacturing

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  Published in Stocks and Investing on Tuesday, February 3rd 2026 at 9:43 GMT by The Messenger
      Locales: New York, New Jersey, Pennsylvania, UNITED STATES

Washington D.C. - February 3rd, 2026 - The Biden administration today announced the disbursement of $8.3 billion in grants aimed at revitalizing domestic semiconductor manufacturing. This significant investment, stemming from the CHIPS and Science Act passed in 2025, represents a pivotal moment in the ongoing effort to reduce U.S. reliance on overseas chip production and fortify national security interests. The funding, distributed amongst industry giants like Intel, Taiwan Semiconductor Manufacturing Co. (TSMC), and GlobalFoundries, as well as key supporting companies, signals a long-term commitment to reshoring critical technology production.

The initial announcement, made by the Commerce Department, detailed the allocation of funds to projects spanning several states - Arizona, New York, and Ohio - each poised to become hubs for advanced semiconductor fabrication and research. Commerce Secretary Gina Raimondo underscored the strategic importance of this move, stating, "These investments will not only bring vital manufacturing back to the United States, creating thousands of good-paying jobs, but fundamentally strengthen our supply chains against future disruptions."

A Deep Dive into the Allocations

Intel stands to receive a substantial $1.9 billion to establish a cutting-edge semiconductor manufacturing facility in New Albany, Ohio. This facility is anticipated to be a cornerstone in the Midwest's growing tech sector, bringing high-skilled jobs and fostering innovation. TSMC, a global leader in semiconductor manufacturing, will receive $1.6 billion to further develop its Phoenix, Arizona facility, a critical component in bolstering the U.S.'s capacity for producing leading-edge chips. GlobalFoundries will be awarded $1.5 billion to expand its operations in Milton Keynes, New York, enhancing its ability to manufacture specialized chips crucial for defense and automotive applications.

Beyond these major players, the administration also recognized the importance of the entire semiconductor ecosystem. Amkor Technology, a key provider of packaging and testing services, will receive $1.9 billion. KLA Corporation ($764 million) and Applied Materials ($689 million), both vital suppliers of equipment and materials used in chip manufacturing, will also benefit from the funding. This holistic approach highlights the administration's understanding that a robust semiconductor industry requires a thriving supply chain from design to finished product.

The CHIPS Act: A Long-Term Strategy

The $8.3 billion in grants is drawn from the broader $280 billion authorized by the CHIPS and Science Act. Passed after years of debate, the legislation aimed to address the vulnerabilities exposed during the global chip shortage of 2022-2024. That shortage, fueled by pandemic-related disruptions and geopolitical tensions, significantly impacted industries ranging from automotive and consumer electronics to defense and healthcare. The CHIPS Act isn't solely focused on manufacturing; it also prioritizes research and development, as well as workforce development initiatives designed to train the next generation of semiconductor engineers and technicians.

Beyond the Headlines: Implications and Future Outlook

Industry analysts predict that these investments will have a cascading effect throughout the U.S. economy. The construction and operation of these new facilities will create not only direct employment in the semiconductor sector but also indirect jobs in supporting industries like construction, logistics, and materials science. Furthermore, increased domestic chip production is expected to reduce reliance on volatile global supply chains and enhance U.S. competitiveness in the global technology landscape.

However, challenges remain. Building these facilities is a complex and time-consuming process. Securing a skilled workforce, navigating regulatory hurdles, and maintaining cost competitiveness are all critical factors that will determine the ultimate success of this initiative. The competition for talent is fierce, and the U.S. must compete with established semiconductor hubs in Asia to attract and retain qualified engineers and technicians.

John Neuffer, CEO of the Semiconductor Industry Association, hailed the grants as a "major milestone" in the implementation of the CHIPS Act. He emphasized the importance of continued investment in semiconductor technology to "strengthen America's leadership" and mitigate the risks associated with supply chain disruptions. Looking ahead, the Biden administration is expected to announce further rounds of funding under the CHIPS Act, focusing on areas such as advanced packaging, materials research, and workforce development. The goal is clear: to establish the U.S. as a global leader in semiconductor innovation and manufacturing for decades to come.