TSMC’s $165 Billion Investment Establishes Arizona as Semiconductor Hub

Categories: Arizona Business NewsArizona State News

The state-of-the-art TSMC semiconductor fabrication plant in Arizona, promising thousands of jobs and economic growth.

News Summary

Arizona is set to become a major player in semiconductor manufacturing following TSMC’s announcement of a $165 billion investment in the region. This investment will create 12,000 direct jobs and significantly bolster local economic growth. TSMC’s expansion plans, which include multiple fabrication plants and research centers, are anticipated to foster job opportunities and support workforce development initiatives in collaboration with local colleges and universities. The investment marks a pivotal shift in the U.S. semiconductor landscape, drawing attention from tech giants like AMD and NVIDIA.

Arizona has emerged as a central hub for semiconductor production with TSMC’s announcement to invest a staggering USD 165 billion in the United States. This monumental investment is anticipated to directly create 12,000 jobs once all associated manufacturing sites are fully operational, significantly bolstering the local economy.

Rose Castanares, President of TSMC Arizona, confirmed these developments during an interview, emphasizing the company’s commitment to enhancing semiconductor manufacturing in the region. TSMC’s investment stems from its initial commitment of USD 65 billion announced in 2020, which set the foundation for the construction of three fabrication plants (fabs) in Arizona, driven by incentives offered under the U.S. CHIPS Act.

The initial phase of TSMC’s investment is projected to create 6,000 jobs, with the first fab already starting volume production in the first half of this year. In March, TSMC expanded its plans by announcing an additional USD 100 billion investment to construct three more fabs, two packaging facilities, and a research and development center, which will add another 6,000 jobs to the Arizona workforce, thereby reaching a total of 12,000 direct jobs across its facilities.

Beyond direct employment, TSMC’s expansion will generate up to 40,000 construction jobs over the next four years, indicating substantial growth in the area’s job market. Construction of TSMC’s second fab has now been completed, with the first fab set to ramp up production by the fourth quarter of 2024. Construction activities for the third and fourth fabs are expected to commence later this year.

TSMC’s Arizona facilities are already garnering attention from major tech players. Companies like AMD are now utilizing TSMC’s Arizona fabs for their chip production, marking a significant shift as AMD will manufacture its 4nm chips domestically instead of depending on production from Samsung Foundry. Additionally, NVIDIA is investing USD 500 billion in U.S.-based AI server production, with their next-generation Blackwell chips being produced at TSMC’s Phoenix facility, further highlighting the importance of this site in the national tech supply chain.

Currently, TSMC employs approximately 3,000 workers at its Phoenix facility, a number expected to grow to around 6,000 with the new expansions. The hiring process will focus on a diverse range of positions, predominantly for technicians, with many roles not requiring a bachelor’s degree, thereby making opportunities accessible to a broader segment of the workforce.

In response to the local labor needs, TSMC has initiated several programs in collaboration with community colleges and universities, including Arizona State University, aiming to cultivate future technicians. One such initiative includes an apprenticeship program that allows aspiring technicians to gain practical experience while pursuing their education. Apprentices work 40-hour weeks and enroll in one college course each week, starting with a salary of around USD 40,000.

Efforts are underway to expand the apprenticeship program to further build the talent pool for the semiconductor industry. Historically, TSMC relied on importing skilled workers from Taiwan, but as operations in Arizona expand, the company is committed to hiring and training local talent to meet workforce demands. The semiconductor industry is facing a projected shortage of 67,000 workers in the coming years, according to data from the Semiconductor Industry Association and Oxford Economics, highlighting the urgency for effective training and job creation programs.

Current employee training may involve temporary assignments in Taiwan, allowing workers to gain exposure to specific technologies and operations critical to TSMC’s manufacturing processes. With its ambitious investment strategy and commitment to local workforce development, TSMC’s Arizona initiative is poised to make a lasting impact on the semiconductor industry and the U.S. economy.