Latino Communities Could Disproportionately Benefit From New Semiconductor Investments

Through its policy initiatives, the Biden administration has shown that it is focused on growing the economy by growing the middle class. A key component of that strategy involves bringing foreign supply chains back to America to create good-paying jobs here at home. One industry, in particular, that has seen tremendous success is advanced manufacturing for components such as semiconductors—microchips used in everyday products including laptop computers, cellphones, and home appliances.

In recent years, chipmakers have announced more than three dozen semiconductor manufacturing projects across 20 states that will create tens of thousands of new jobs and spur new economic activity. These investments could benefit from the bipartisan CHIPS and Science Act, which President Joe Biden signed into law last year, and provide incentives to grow domestic chip manufacturing. And while the investments will benefit all Americans by fortifying the supply of U.S.-made chips, Latinos could reap some of the most direct rewards, according to new analysis from the Center for American Progress Action Fund.

To date, chip manufacturers have announced more than $790 billion in private sector investments across the country, according to the Center for American Progress’ Biden Administration Investment Tracker. Strikingly, new analysis finds that $662 billion—or more than 83 percent—of total chip investments are being made in areas with large Latino populations. Specifically, these investments benefit areas where at least one congressional district has a Latino population that is at or higher than the national average. This means that Latinos could have a unique opportunity to benefit from the influx of good-paying jobs these investments will create, with the economic growth spurred by this burgeoning industry supporting their communities and small businesses.

Of course, the location of chip investments in Latino communities does not guarantee that Latinos will fill the jobs that are created; however, the Biden administration is taking specific steps to ensure that communities do see equitable benefits. One way it’s doing this is by helping catalyze partnerships between Hispanic-serving institutions (HSIs), which serve a large share of Latino students, and semiconductor companies. Together, these partnerships will help grow the STEM workforce to meet industry workforce needs by encouraging increased investments in education, apprenticeships, and other job training programs. For example, according to a fact sheet from the Arizona Commerce Authority, Maricopa Community Colleges—which account for almost half of all HSIs in Arizona—have launched a new Semiconductor Technician Quick Start program, in partnership with Intel and Taiwan Semiconductor Manufacturing Company (TSMC), to train students for semiconductor technician careers in as little as two weeks. The fact sheet highlights that in the program’s first year, “587 students earned certifications, with over two-thirds representing students of color and over half representing first generation college students.”

Partnerships such as this will be critical to building a stronger school-to-career pipeline for Latinos, who are more likely to go to community college but have also long faced persistent barriers to training and careers—and, as a result, have been underrepresented in the technology industry. As Steven Gonzales, chancellor of Maricopa County Community College District, told CAP Action in a recent interview, “There’s stigma for many Hispanics going to community college. That’s why the Maricopa Community Colleges are proud to have all 10 of our colleges designated as HSIs, focused on breaking down barriers so that all students, regardless of their background, have the opportunity to pursue higher education, reskill, and upskill through amazing programs like Quick Start.”*

While these investments are creating new semiconductor jobs in communities with large shares of Latinos, they are also growing the ranks of union membership, small businesses, and economic activity in these areas more broadly. For example, in a recent interview with CAP Action, Fabian Sandez—a first-generation Mexican American and regional manager of the Southwest Mountain States Regional Council of Carpenters Local 1912—credited the Intel and TSMC projects with spurring increased demand for unionized carpentry work: “The new projects extend beyond construction of the [semiconductor] fabs, because there is increased demand for things like battery plants, housing, and retail.” This surge in demand has helped grow his local’s membership from 1,800 in 2016 to more than 5,000 today.

Separately, Paul Sarzoza of Glendale, Arizona—a former farmworker and the son of Mexican immigrants—is the president, CEO, and co-founder of Verde Clean, a facilities service company that employs more than 250 people and is creating up to 800 jobs over the next decade after securing a custodial contract at the new TSMC fabrication plant in Phoenix. In an interview with CAP Action, Sarzoza shared that in addition to creating jobs, Verde Clean’s contract with TSMC is also enabling him to invest more in his employees with better wages and benefits.

Because of the Biden administration’s CHIPS and Science Act, stories like this are happening all across the United States and putting the American dream within reach for Latinos, who have long faced significant barriers to achieving it. While these investments are welcome and the stories above provide a gleam of optimism, the unfortunate truth is that Latinos have been underrepresented in the STEM workforce and there is still a long way to go to achieve true equity. By making sure CHIPS and Science Act investments are reaching the communities that need them the most, the Biden administration is helping address and close these racial and ethnic disparities in the STEM workforce. Sticking with its promise to grow the economy more equitably and build more bridges to America’s middle class, the Biden administration is making sure Latinos can benefit from this new law and have the chance to be integrated into the STEM workforce.

*Authors’ note: All interviews were conducted by CAP Action over the course of 2023.