How the CHIPS Act is Transforming the Semiconductor Industry

Prevailing wage rates help create an equitable playing field for contractors bidding on government projects. They prevent companies from undercutting labor costs to win contracts using taxpayer dollars. 

The Department of Labor sets prevailing wage schedules based on comprehensive surveys of local pay for various construction trades and job types. Rates differ across geographic areas reflecting regional economic conditions. 

For payroll compliance in the Semiconductor Industry, key factors include: 

• Construction trades: Prevailing wages for electricians, pipefitters, crane operators, and other building trades involved in plant construction.
• Job classifications: Wage rates set for many semiconductor manufacturing roles like process technicians, cleanroom workers, and equipment maintenance personnel.
• Certified payroll reports: Detailing employee work classifications, pay rates, and weekly hours to prove compliance. 

Unlocking Government Contracts: The CHIPS Act Impact 

The Department of Commerce, in response to the CHIPS Act, launched several funding opportunities. According to a White House fact sheet:    

• "The Department of Commerce launched the first funding opportunity for the $39 billion in semiconductor manufacturing incentives provided in the Act just six months after CHIPS was passed. This funding opportunity covers funding for projects to construct, expand, or modernize facilities producing semiconductors and for projects that are making large investments in facilities to produce semiconductor materials and manufacturing equipment. As the Department assesses applications, economic and national security considerations will be key factors and the program will, among other objectives, aim to provide a supply of secure, national-security relevant semiconductors.  
  
  
• The Department of Commerce released a funding opportunity in May 2023 for Phase 1 of the $500 million Tech Hubs Program. This is an economic development program to develop centers of innovation across the country through support of regional manufacturing, commercialization, and deployment of key technologies.  
  
  
• The National Science Foundation established a new Directorate for Technology, Innovation, and Partnerships. This Directorate has already launched the NSF Regional Innovation Engines program, which is helping to support innovation in geographies that have not received the full benefits of technology advancement in past decades. In May 2023, NSF announced 44 NSF Engines Development Awards spanning 46 U.S. states and territories, each funded at up to $1 million over two years to plan for a future NSF Engine. In August 2023, NSF announced 16 finalists for the inaugural set of NSF Engines awards, which are anticipated by the end of the year and will provide each NSF Engine with up to $160 million over up to 10 years.  
  
  
• … the Department of Commerce announced its first round of grants from its $1.5 billion Public Wireless Supply Chain Innovation Fund to support the development of open and interoperable wireless networks." 

These developments signal a significant shift in the landscape of government contracts. You can explore the complete fact sheet for a comprehensive understanding of the changes set in motion. 

Funding Opportunities Abound with CHIPS Act 

The CHIPS Act has swiftly translated into tangible opportunities for businesses across various sectors. The Department of Commerce, in alignment with the Act's objectives, has introduced multiple funding opportunities that cater to the diverse needs of the industries involved. 

For instance, the semiconductor industry benefits from funding aimed at constructing and modernizing semiconductor production facilities. This is a game-changer, allowing manufacturers to not only meet the demands of the market but also enhance their technological capabilities. 

Moreover, the Tech Hubs Program, with its focus on regional innovation, offers businesses the chance to be part of cutting-edge developments. By supporting manufacturing, commercialization, and technology deployment, this initiative creates a conducive environment for growth and progress. 

The CHIPS Act is not just about allocating funds; it's about empowering businesses and industries to thrive in an era of technological revolution. 

Maintaining prevailing wage and payroll compliance in the Semiconductor Industry across large, complex projects like fab construction can prove extremely challenging without the right tools. 

Points North offers our automated Certified Payroll Reporting solution purpose-built for government contractors. Our software integrates with leading payroll platforms to simplify compliance processes including: 

• Creating federal, municipal, state, and even union certified payroll reports 
• Managing your rate management even in complex situations 
• Customization options for custom report templates to meet any needs 
• Scheduled Davis-Bacon report generation
• Optimized distribution through email distribution lists and bulk email options
• Integration with all major payroll solutions 

Centralized capabilities reduce administrative burdens so semiconductor manufacturers can focus on what really matters – their business. Customized compliance features for the industry also ensure alignment with CHIPS Act requirements even if requirements change.