We must ensure US semiconductor jobs are actually good

The pitch from the Biden-Harris administration for the CHIPS and Science Act was tempting. Not only would the historic investment of up to $175 billion bring semiconductor manufacturing back to the U.S., but it would also create good, high-paying jobs along the way.

Two years after the bill’s signing, the first half of that promise seems to be coming true, as the Department of Commerce has reached preliminary agreements with 16 companies to ramp up domestic production of the minuscule computer chips that make everything from smartphones to military radars click.

The second half of the promise? It’s a mixed bag, according to findings I have laid out in a new report.

After combing through research and speaking with semiconductor manufacturing workers at multiple facilities, we found that the industry is plagued with low pay, limited avenues for advancement, grueling schedules and exposure to dangerous toxic chemicals.

Many workers at semiconductor plants, known as fabs, make just $20 an hour, or around $40,000 for the whole year — assuming full 40-hour work weeks, which many don’t get because of frequent production shutdowns.

In fact, surveys have found that more than half of workers in semiconductors and electronics are considering leaving their jobs in the next six months, often because of low pay, lack of job advancement opportunities and challenging schedules. And more advanced openings are often out of reach for production workers.

That low pay is all the more galling when you consider just how rich executives and shareholders are getting from selling microchips. Many of the firms with CHIPS subsidies have plowed enormous sums into buying back their own stock, which artificially inflates their stock price — and the CEO pay that’s linked to it.

Eleven chipmakers in line for CHIPS subsidies, my colleague Sarah Anderson found in an earlier report, “spent more than $41 billion combined on stock buybacks” over the last four years. “That would’ve been enough to provide 300,000 employees a $27,541 bonus every year for five years,” she noted.

Analog Devices CEO Vincent Roche, whose firm spent $9 billion on buybacks during the study period, took home $25.5 million in 2023. Meanwhile, workers we spoke to at Analog couldn’t afford to live without roommates and had to seek unemployment during work stoppages just to keep up with their bills.

“It is a huge concern of mine that a multi-billion-dollar company that pays its CEO $25.5 million per year and spends billions on stock buybacks doesn’t provide its employees with wages that can support a single person in the area, let alone provide family wages,” an operator at Analog’s Beaverton, Ore., facility told me.

Semiconductor production has been dangerous from the get-go. In the 1990s, several studies found that working at fabs was causing miscarriages and increased rates of cancer among workers. Companies promised to phase out the chemicals linked to those issues, but disease rates from their overseas operations say otherwise.

And the agency tasked with regulating toxic exposure in the workplace, the Occupational Safety and Health Administration, admits that its standards are woefully inadequate and outdated. OSHA has rules in place for only about 500 of the thousands of chemicals semiconductor workers are exposed to. And the limits it does have in place are far less stringent than the biomedical consensus around safe exposure would recommend.

Thankfully there is time to make these jobs better. Billions in subsidies and loans to semiconductor companies are still waiting to be disseminated. By putting strong guardrails in place, the administration can guarantee that this massive investment creates high-quality, safe jobs for communities.

Our report recommends that the Commerce Department institute strict transparency requirements about the chemicals used in chips production, ensure that companies are not infringing on the rights of workers to organize collectively and collaborate with the Labor Department to guarantee that wages and benefits are held to a high standard.

We also suggest that the Department of Commerce bar any companies receiving federal CHIPS funding from buying back their own stock.

By setting strong standards now, the Biden-Harris administration can improve the semiconductor industry and make good on its promise to create good-quality jobs for Americans.

Chris Mills Rodrigo is the managing editor of the Inequality.org website at the Institute for Policy Studies. A former tech reporter, he’s the author of the new IPS report “Leveraging the CHIPS Program to Create Good Jobs for All Semiconductor Workers.”