President Joe Biden faces another test of his commitment to revitalizing U.S. manufacturing and boosting organized labor, as unions turn their attention to the semiconductor industry.

Micron’s $50 billion investment in two New York factories, funded by the 2022 Chips and Science Act, marks a significant step.

The project could eventually expand to $100 billion over two decades and create up to 9,000 jobs. This agreement, if successful, would prevent picketing or strikes by the CWA while ensuring Micron refrains from anti-union activities.

Labor unions are leveraging Biden’s economic policies, which allocate substantial subsidies for technologies like semiconductors and clean energy, to push for new factory organization.

The United Auto Workers (UAW) recently organized EV battery plants and is targeting 14 more companies.

However, the semiconductor industry presents unique challenges. Prominent figures like Morris Chang, founder of Taiwan Semiconductor Manufacturing Co Ltd (NYSE:TSM) have criticized organized labor.

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Intel Corp. (NASDAQ:INTC), which received the largest Chips Act subsidy, has been hesitant to engage in union talks, according to CWA President Claude Cummings.

Despite initial setbacks with Intel, Cummings remains hopeful that an agreement with Micron could encourage other semiconductor companies to consider union negotiations. Many new chip factories are located in right-to-work states such as Arizona and Texas, where union membership cannot be mandated.

The Chips Act funding is distributed in phases, contingent on companies meeting various benchmarks, providing the Biden administration with negotiating power.

While the specifics of these agreements remain undisclosed, the White House and Commerce Department have expressed support for partnerships between the semiconductor industry and labor unions.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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