Congress Should Triple Federal Investments in Semiconductor Research

by John Neuffer, President and CEO

America is in a race with global competitors to win the technologies of the future, including artificial intelligence, quantum computing, and 5G and 6G wireless networks. Semiconductor innovation is the engine that drives all these promising technologies. As Congress turns to the budget, setting aside research funds to keep America the world leader in semiconductor technology is critical.

To that end, SIA in a letter today urged leaders in the House and Senate to triple investments in semiconductor research over the next five years to a total of $5 billion annually.

U.S. semiconductor companies have long prioritized investment in research, plowing about one-fifth of revenues back into R&D annually ($39 billion is 2018). That’s among the highest shares of any sector, second to only the pharmaceutical industry. Public and private investments complement each other well to maximize advances in semiconductor technology. While industry’s R&D investments tend to focus on near-term technological advances, federal investments in research aim to spur long-term, leap-ahead innovations.

SIA’s letter echoes a core recommendation of our recent policy agenda, titled “Winning the Future: A Blueprint for Sustained U.S. Leadership in Semiconductor Technology.” That report showed U.S. government investment in research has been declining in comparison to key global competitors, most notably China. It called for tripling federal investment in semiconductor research to $5 billion annually and doubling funding for semiconductor-related fields such as materials science, engineering, and applied mathematics to $40 billion annually.

Federal investments in semiconductor research at the Department of Energy, the Department of Defense, the National Science Foundation, and the National Institutes of Standards and Technology provide a significant return on investment to the American taxpayer by accelerating the development of cutting-edge technologies.

In addition to advancing the fundamental, enabling technology of modern electronics, substantially increasing funding for semiconductor research will help ensure the U.S. wins the race to develop and deploy the must-win technologies of the future, including artificial intelligence, quantum computing, and 5G and 6G wireless networks. These technologies will be instrumental in determining global economic leadership in the years ahead. Additionally, federal investments in semiconductor research help train the next generation of highly skilled American engineers and scientists who will conduct the research.

Continued semiconductor innovation will require research in new materials, designs, and architectures through a whole-of-government approach and public/private partnerships to apply the best research from academia, industry, and government research centers. Congress can take a critical step toward sustaining and strengthening America’s global technology leadership by tripling federal investments in semiconductor research.