Dive Brief:

• Intel held its groundbreaking ceremony Friday in Licking County, Ohio, on its newest $20 billion semiconductor manufacturing site, in what the firm called the largest single private-sector investment in state history.
• The initial phase of the project is expected to create 7,000 construction jobs over the course of the build and support tens of thousands of additional long-term jobs at suppliers and other partners, according to a company press release. The facility will eventually employ 3,000 Intel workers.
• The semiconductor giant selected Providence, Rhode Island-based Gilbane Building Co., along with Ohio-based McDaniel’s Construction, Northstar Contracting and GTSA Construction Consulting, to manage early excavation work on the project.

Dive Insight:

The passage of the CHIPS Act in July was critical in allowing construction to move forward on the massive project. 

President Joe Biden, who attended the groundbreaking ceremony Friday, pointed to jobs creation, along with the easing of supply chain issues, as long-term benefits of CHIPS Act funding.

“Since I took office, our economy has created nearly 10 million new jobs, more than 668,000 manufacturing jobs. Because I signed into law the CHIPS and Science Act, we’re accelerating the progress,” said Biden. “This new law makes historic investment for companies to build advanced manufacturing facilities here in America.”

Pat Gelsinger, Intel's CEO, said the project played a key role in the broader onshoring trend to locate more manufacturing facilities in the U.S.

“Today marks a pivotal moment in the journey to build a more geographically balanced and resilient semiconductor supply chain,” said Gelsinger.

Gilbane will manage the team’s work to prepare the site for the construction of the factories. Local partners McDaniel’s, Northstar and GTSA will provide staff augmentation and consulting services for Phase 1, according to the release.

Chips factory construction ramping up

Intel’s investment in Ohio comes on the heels of the company’s announcement to build two new fabs in Arizona, and its expansion in New Mexico to add advanced packaging capabilities. Construction on both projects broke ground last year. These sites will boost chip production to meet the surging demand for advanced semiconductors. 

Semiconductors are the brains inside a broad array of consumer and industrial products, from laptops to smartphones, military devices and components for aerospace and electric vehicles. Chips shortages due to the pandemic's impact on global supply chains illustrated the need for more domestic manufacturing.    

For example, Micron announced plans in August to invest $40 billion through the end of the decade to build leading-edge memory manufacturing in multiple phases in the U.S. That investment will ultimately create up to 40,000 new American jobs, according to a Micron release. 

Despite warnings from chipmakers about slowing demand for consumer electronics, other demand remains strong. Qualcomm, for example, agreed to buy an additional $4.2 billion in semiconductor chips from GlobalFoundries’s New York factory, bringing its total to $7.4 billion in purchases through 2028, reports Reuters.