KVIG Informative

Congress and two administrations have poured tens of billions of dollars into rebuilding America’s semiconductor industry, but the honest timeline for most of that capacity to actually produce a chip runs three more years out.

The 2022 CHIPS and Science Act authorized $52.7 billion in federal loans, loan guarantees and grants over five years to build domestic semiconductor manufacturing, plus a 25% tax credit for U.S. chip investments, according to the Center for Strategic and International Studies. By August 2024, the Commerce Department had allocated $30 billion of that money across 23 projects in 15 states, tied to a projected 115,000 construction and manufacturing jobs.

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Only three semiconductor fabs funded under the effort are currently in volume production, with a combined output capacity of roughly 69,000 wafers per month, according to industry supply-chain analysis. Fabs under construction with 2026-2027 start dates represent another 175,000 wafers per month of capacity, but most of that new capacity will not reach full volume production until 2028 to 2030.

The labor side of the buildout is falling behind the construction side. Domestic semiconductor and electronic component manufacturing employment has declined since 2023, even as new fab construction accelerates, and outside estimates project a shortfall of tens of thousands of skilled technician and engineering positions by the end of the decade.

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The Center for Strategic and International Studies has identified the labor gap as a structural problem, not a temporary one: the same skilled-trades workforce needed to build new chip fabs is also being pulled toward projects funded by the 2021 infrastructure law and the 2022 climate law, creating a national shortage of qualified construction workers that predates and outlasts any single semiconductor project.

President Trump has pushed to reshore chip production through tariffs on foreign-made semiconductors while also signaling support, along with congressional Republican allies, for unwinding parts of the CHIPS and Science Act framework passed under the Biden administration — creating uncertainty for chipmakers mid-construction about which federal commitments will hold.

For companies that depend on domestically produced chips, the near-term reality has not changed: semiconductor lead times stretched to roughly 40 weeks as of March 2026, and the vast majority of components purchased this year are still manufactured on pre-CHIPS Act capacity in Taiwan, South Korea, Japan and China.

The CHIPS Act succeeded at attracting capital — that much is measurable in the ground being broken across Arizona, Texas, Ohio and New York. Whether it succeeds at its actual goal, an American-made chip supply chain insulated from a Taiwan crisis or a Chinese export restriction, will not be testable until the back half of this decade, when the fabs under construction today are finally supposed to turn on.