Half of the positions created by the inaugural TSMC chip manufacturing facility in Arizona have been occupied by Taiwanese workers, even though the company has been granted up to $11.6 billion in funding aimed primarily at creating jobs for American citizens.
The initial news of Apple sourcing chips made in the United States by American labor has become less compelling over time …
Background on TSMC’s Arizona chip manufacturing sites
TSMC’s decision to establish a chip fabrication facility in Arizona was celebrated as a significant win for the US CHIPS Act – designed to reduce the nation’s reliance on China for cutting-edge chip manufacturing and generate employment for American workers. Apple proudly announced plans to procure chips made in America for certain devices.
However, the initial enthusiasm began to fade quickly. The first plant will only be capable of producing larger process chips, which are only compatible with older Apple products, and TSMC soon called for larger subsidies and fewer restrictions.
The project’s timeline fell behind schedule and exceeded budget expectations, with production now postponed to 2025, having originally been set for 2024. Additionally, there are concerns that US-produced chips may come at a higher price than those manufactured in Taiwan, potentially leading Apple to procure fewer than initially anticipated.
There have been assertions that the first facility may end up being of limited utility, as the produced chips would need to be sent back to Taiwan for the ‘packaging’ process, which involves integrating various circuit boards into a single chip. Apple later announced plans for another US-based facility to handle the chip packaging.
Most recently, a delay was reported in the timeline for 2nm chip production due to a lawsuit alleging “anti-American discrimination” against the company.
Taiwanese workforce dominates
TSMC initially indicated that the high percentage of Taiwanese hires was merely a temporary arrangement during the construction phase. Nonetheless, this assertion has faced scrutiny as the situation reportedly remained the same last year.
Concerns regarding US job creation emerged when TSMC chose to bring in approximately 500 Taiwanese workers to accelerate construction efforts, and the situation quickly escalated.
While described as a short-term solution utilized solely for the construction phase, new reports suggest a different reality. The Financial Times indicates that nearly half of the production workforce has already been hired, with about 50% sourced from Taiwan.
A report from the New York Times confirms that this trend persisted into late 2024, echoing the same claims just months before production is set to commence.
Approximately half of the roughly 2,200 employees have been recruited from Taiwan. Some other Taiwanese workers have arrived in Arizona under temporary contracts for the factory construction. The company anticipates that the number of American workers will rise as the plants are developed […]
TSMC has stated that its first facility in Phoenix is expected to begin commercial production in the first half of 2025.
Photo: Bravo Prince on Unsplash.
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