2024 State of the Industry Report Underscores Opportunities and Challenges for U.S. Chip Industry

by Greg LaRocca, Director of Market Research and Economic Policy

The Semiconductor Industry Association (SIA) released its annual State of the Industry Report today. The report highlights opportunities for continued growth and innovation across the semiconductor industry and notes current and upcoming challenges to the industry’s sustained success.

Last year, industry global sales reached $527 billion and nearly 1 trillion semiconductors were sold globally, more than 100 chips for every person on earth. With a cyclical market downturn now over and demand for semiconductors high, estimates from World Semiconductor Trade Statistics project sales to increase to over $600 billion in 2024.

Rising demand has prompted new industry investments to increase chip production. Thanks in part to the landmark CHIPS and Science Act, the United States is forecast to more than triple its semiconductor fabrication capacity and secure a larger share of new private investment in semiconductor manufacturing. In fact, companies in the semiconductor ecosystem have announced more than 90 new manufacturing projects in the U.S. since CHIPS was first introduced in Congress, totaling nearly $450 billion in announced investments across 28 states. These investments are projected to create tens of thousands of direct jobs and support hundreds of thousands of additional jobs throughout the U.S. economy. The industry is investing in countries worldwide, creating a more robust and resilient supply chain.

Reinforcing and expanding chip supply chains on U.S. shores offers tremendous opportunities, but it also presents significant challenges. For example, as U.S. chip operations expand in the years ahead, so will the demand for skilled talent. Other policy challenges also remain, including continued implementation of the CHIPS and Science Act, reinforcing U.S. leadership in semiconductor research, design, and manufacturing, and maintaining open access to overseas markets where companies can sell the chips manufactured here at home.

Other governments have also taken a particular interest in advancing supply chain resilience when it comes to the production of chips and upstream materials capacity, with a goal to reduce strategic dependencies. The industry is committed to ensuring global semiconductor supply chains are resilient, further promoting access to global markets, and facilitating increased global trade through deeper international collaboration.

Overall, the semiconductor industry is well-positioned for long-term growth. As innovation continues to increase globally, so will the need for semiconductors to serve as the foundation of that progress.

Semiconductors have never played a more important role in society than they do today, and the future of our industry has never been brighter.