The Taiwan Semiconductor Manufacturing Company (TSMC) has confirmed significant delays in the construction of its first chip factory in Arizona. The delay is primarily due to a shortage of technical workers with critical expertise in the US. TSMC is a leading supplier of AI chips, and with the booming investment in AI, the Biden administration is eager to expand the US domestic chip industry. However, the delay was not unexpected, as skilled workers are limited to a few places on the planet, such as Taiwan, Korea, and China. TSMC plans to send more workers from Taiwan to ensure a fast ramp up of the Arizona fab. The delay may impact the completion of the second fab. The cost of building in the US is also a setback for TSMC, leading the company to find ways to cut costs. Tensions have arisen between US and Taiwanese workers, with union electricians feeling double-crossed by the arrival of overseas workers. The union contractors predict that TSMC will continue to struggle to recruit American workers unless wages are raised.
| Signal | Change | 10y horizon | Driving force |
|---|---|---|---|
| Delay in TSMC’s Arizona chip factory construction | Delay in chip factory construction timeline | Increased investment in AI chips, expansion of US domestic chip industry | Shortage of technical workers with critical expertise in the US |
| Skill shortage in semiconductor fabrication plants | Difficulty in accessing skilled workers for building fabs | Increased focus on refining skills and training workers in multiple locations | Limited availability of skilled workers in Taiwan, Korea, and China |
| TSMC sending more Taiwanese workers to the US | Increased deployment of Taiwanese workers in US fabs | Fast ramp-up of chip factory construction in Arizona | Ensuring timely completion of fabs due to worker shortage |
| US building costs more expensive than in Taiwan | Higher building costs in the US compared to Taiwan | Increased focus on cost-cutting measures | Higher construction expenses in the US impacting project timelines |
| Tension between US and Taiwanese workers at Arizona construction site | Conflict between US and Taiwanese workers | Strained labor relations and potential labor disputes | Differences in wages, incentives, and recruitment practices between US and Taiwanese workers |