A full half of the jobs created by the first TSMC Arizona chip plant have been filled by workers from Taiwan, despite the company receiving up to $11.6B worth of grants intended in large part to generate US jobs.
The original headline news of Apple chips being made in the US by American workers has seemed less and less impressive over time …
Backgrounder on TSMC’s Arizona chip plants
TSMC’s announcement that it was building a chip fabrication plant in Arizona was hailed as a major success for the US CHIPS Act – intended to free the US from dependence on China for advanced chip supplies, and to generate jobs for US workers. Apple proudly announced that it would be buying American-made chips for some of its devices.
The gloss soon began to wear off, however. The first plant will only be able to make larger process chips, only suitable for older Apple devices, and it wasn’t long before TSMC demanded bigger subsidies and fewer rules.
The project fell behind schedule, and over budget, with production already pushed into 2025, from 2024. There is talk of US-made chips costing more than those made in Taiwan, which could mean Apple would buy fewer of them than originally expected.
There were claims that the first plant would be a paperweight, as output would need to be sent back to Taiwan for what’s known as the ‘packaging’ process of encapsulating different circuit boards into a single chip. Apple later announced that it would commission another US-based facility to package the chips.
Top comment by booger
This isn't really surprising or out of the ordinary. I spent years starting up and working at a different foreign owned fab operating in the US. In my experience, the first thing they are going to do is match a known TSMC process to qualify the factory's operation. The people who know that process best are going to do much of that work while the American workforce comes up to speed. I am sure that most of the American process-related talent (i.e. the folks responsible for getting the on-wafer product right) is experienced in general, but perhaps not with the TSMC specifics. On the operations side is where most of the inexperienced new workers will be. It takes a not insignificant amount of time for them to get going and that clock doesn't really start until the fab is operational. Over the first two years or so, I would expect to see most of the Taiwanese workers (that are probably rotating over here in batches) transition home permanently.
Most recently, a further delay was announced for 2nm chip production, as a lawsuit accused the company of “anti-American discrimination.”
Half the workers are from Taiwan
TSMC originally said that the prevalence of Taiwanese hires was simply a temporary measure during the construction phase. However, this claim was questioned as the situation remained unchanged last year.
US job creation was first thrown into doubt when TSMC decided to bring in around 500 Taiwanese workers to speed up construction work. The battle over this quickly turned ugly.
But while this was described as a short-term measure, used only for the construction phase, a new report today paints a different picture. The Financial Times says that with almost half the production workforce already recruited, around 50% of them are actually from Taiwan.
A New York Times report says it’s still the case at the end of 2024, with the same claim still being made today, just a few months before production is scheduled to start.
About half of the approximately 2,200 employees have been brought in from Taiwan. Some other Taiwanese workers have come to Arizona on temporary contracts for constructing the factories. The company expects the proportion of American workers to increase as it builds out its plants […]
TSMC said its first factory in Phoenix was expected to begin commercial production in the first half of 2025.
Photo: Bravo Prince on Unsplash.
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