The passage of the Commodity Incentives to Produce Semiconductors (CHIPS) Act has generated widespread excitement about the possibility of an increase in U.S. semiconductor manufacturing. With the U.S. likely to experience growth in semiconductor manufacturing, researchers at Ball State University have identified locations across the country most likely to experience an expansion of semiconductor chip production in the coming years. A recently released study from Ball State University’s Center for Business and Economic Research (CBER) titled “Semiconductor Plant Siting Decisions in the Wake of the CHIPS Act” identifies 83 U.S. counties, classified into three tiers, where new plants are most likely to be established.

The study was co-authored by CBER researchers Dr. Michael Hicks and Dr. Dagney Faulk. According to Dr. Hicks, “the CHIPS Act provides incentives to increase the likelihood of growth in domestic semiconductor manufacturing.” “Combined with the costly disruptions in chip production during COVID-19, the U.S. is especially likely to see new semiconductor production. Where that production will occur is of substantial policy interest in much of the country.”

The CBER study combines data from the Semiconductor Industry Association, the U.S. Census, the Bureau of Economic Analysis, secondary surveys and other private sources to model the likely locations of semiconductor manufacturing companies. Among the most important variables in explaining the expansion of the semiconductor industry are the education level of the workforce (bachelor’s degree or higher), the percentage of residents in graduate programs, population growth, and unexplained productivity (generalized agglomerations).