What powers the electronics you rely on? Semiconductors — also known as chips — are the essential components driving the technology within everyday devices. Semiconductor silicon transistors are the small ‘switches’ that allow devices to become smaller and smarter as technology advances. This tiny piece of tech is in our phones, cars, and computers, but they are also the powerhouses behind electric vehicles (EVs) and essential to many of their systems, including battery management. Michigan is home to one-third of U.S. battery production and is at the forefront of research and development for the EV and battery industries. What do both of these industries rely on? Semiconductors.
Semiconductors are an American innovation that dates back to 1947, but the U.S. experienced a decline in domestic production in recent decades. To counter this, the U.S. enacted the CHIPS and Science Act in 2022. As of August 2024, companies in the U.S. semiconductor ecosystem announced more than 90 new manufacturing projects, totaling nearly $450 billion in announced investments.
Michigan followed suit with its own pledge of investment. The state’s Make It in Michigan plan focuses on creating well-paid jobs and a skilled, talented workforce, and continuing to bring in projects that support its industries and communities. As part of the plan, the state pledged $500 million this year for the Strategic Outreach and Reserve (SOAR) Fund to attract and retain investments encouraging domestic development in industries like clean energy, semiconductors, and mobility. These investments, and the state’s history of automotive and manufacturing success, position Michigan as a leader in the next generation of the semiconductor industry.
Michigan is Committed to the Semiconductor Industry
Michigan has the fifth-largest advanced manufacturing workforce in the country and is helping small to medium-sized manufacturing companies adopt and transition to advanced technologies, like semiconductors for EV batteries. To do this, Michigan has formed strategic partnerships and invested in education initiatives.
For example, in 2022, the state joined the SEMI Foundation, an organization supporting economic opportunity for workers and the sustained growth of the microelectronics industry, investing $1.5 million to create the SEMI Career and Apprenticeship Network (SCAN) in Michigan to create a pipeline of well-paying industry jobs.
In 2023, Michigan established the Semiconductor Talent and Technology for Automotive Research (MSTAR) initiative to create a global semiconductor center of excellence. The MSTAR initiative is a public-private partnership with semiconductor company KLA, technology innovation hub Imec, the University of Michigan, Washtenaw Community College, and General Motors. Earlier this year, the state announced a $10 million investment in MSTAR with the goal of making Michigan the world’s leader in automotive semiconductor technology and talent development. As the global hub of the automotive industry — the state is home to nearly one-fifth of U.S. auto production — Michigan has long been a customer of the semiconductor industry, affording it deep knowledge and expertise.
Similarly, the Michigan Economic Development Corporation (MEDC) pledged $4.6 million in grants and matching funds to support eight local higher education institutions’ semiconductor education and training programs to help build the workforce needed as the industry grows. Some of the recipients include: Delta College, who will use the funding for both adult learners looking to expand their skills or change careers and high school students with STEM exploration programs; Lansing Community College, who is launching a boot camp for entry-level semiconductor roles; and Michigan Technological University, which plans to expand its semiconductor education and training programs across the state’s Upper Peninsula.
The Michigan Semiconductor Opportunity
The state’s semiconductor job market increased by 15% between 2015 and 2020, and it’s projected to increase by 11% over the next five years. Several companies have helped establish the state as a top 10 semiconductor workforce:
- Hemlock Semiconductor, the largest producer of hyper-pure polysilicon, received the state’s first significant and largest proposed investment from the CHIPS Act in October 2024. The Saginaw-based manufacturer was awarded $325 million to build a new facility supporting 180 advanced manufacturing jobs and over a thousand construction jobs.
- KLA chose Ann Arbor out of many locations it considered for its second U.S. headquarters. Announced in 2019 and opened in 2021, the company employs 600 workers and counting. It is also part of MSTAR.
“KLA is focused on investment in research and development to help address key challenges for automotive semiconductors,” said Rick Wallace, president and CEO of KLA, in a press release. “In 2019, KLA opened a second headquarters in Ann Arbor, putting us closer to automotive customers and the larger Michigan technology ecosystem. The MSTAR Michigan initiative accelerates our support for talent development, collaboration, and innovation in the region.”
- SK Siltron opened a new facility in Bay City with a $300 million investment in 2021, beating out five other states for its talent pool and proximity to automakers. The facility brought 150 jobs in advanced manufacturing, ranging from semi-skilled operators to engineers, strengthening Michigan’s automotive, mobility, and advanced manufacturing industries.
- Calumet Electronics Corp., the first company to build organic substrates in the U.S., is enhancing its 35,000-sq.-ft. manufacturing facility to scale production of high-density build-up substrates, crucial for the defense, aerospace engineering, and EV industries. The investment in the Upper Peninsula will create 80 engineering jobs and further solidify the state as a leader in the semiconductor industry.
“MEDC, along with the Keweenaw Economic Development Alliance, has been very supportive of Calumet Electronics throughout this very critical process,” said Calumet Electronics Vice President and Chief Operations Officer Todd Brassard in a press release. “We are committed to advancing Michigan’s role in electronics manufacturing.”
- Imec, a global leader in semiconductor research and development, partnered with the University of Michigan to jointly research semiconductor materials and system architectures for the automotive industry. The university’s proximity to the heart of the U.S. automotive ecosystem and Michigan’s investment and expertise in semiconductor research allow Imec to expand smartly into the U.S. market.
Michigan has — and will continue — to play a key role in the rise of the U.S. semiconductor industry. It has the fourth-highest business research and development spending-to-GDP ratio in the country — a ratio twice as high as the national average. Leading semiconductor companies are building and growing in Michigan because of the state’s commitment and investments in the industry’s success — and its stronghold as the heart of connected industries like automotive and manufacturing. This strong commitment to innovation, along with a historic foundation in automotive and manufacturing, is why leading semiconductor companies are choosing Michigan to grow.
