The scale of the semiconductor industry’s economic impact in Phoenix is unprecedented — but it isn’t happening by accident. It’s the result of years of effort led by ASU, which has created the largest engineering school in the U.S. and developed the state-of-the-art facilities that are fueling the semiconductor boom and countless technological breakthroughs in the industry.
“What is happening in Arizona is the culmination of the work of many people over many years, and it will benefit the state for many years to come. It is a reason to celebrate where we have come from, where we are and what we are becoming — and the nation is depending on us to succeed,” explains Sally C. Morton, who leads research at ASU.
This coordinated effort has attracted tens of billions of dollars in new investment to Arizona from companies, including Applied Materials, TSMC and dozens of other semiconductor companies, creating thousands of additional high-tech jobs.
As a result, the semiconductor industry’s growth in Arizona is paving the way for hundreds of new small businesses, ranging from parts suppliers to restaurants. Dozens of new ASU workforce development programs and major public works projects will also improve roads, water facilities and other infrastructure across the Valley.
Success through collaboration
The key to attracting the world’s top semiconductor companies to the Valley was creating pathways for them to collaborate with world-class researchers at ASU, says Zak Holman, the vice dean for research and innovation at ASU’s Ira A. Fulton Schools of Engineering. For more than a decade, Holman has helped shape ASU’s semiconductor strategy by forging partnerships with industry.
“Partnering with Applied Materials, which is the world’s leading semiconductor equipment manufacturer, was a very purposeful choice,” Holman says. “We needed to bring in unique equipment to ASU, and Applied Materials needed innovative people developing unique things on their equipment so they could sell it to their customers like Intel or TSMC.”
ASU’s industry partnerships are working. In July 2023, Applied Materials announced a $270 million investment to create a Materials-to-Fab Center at ASU’s Research Park in Tempe, which ASU and the Arizona Commerce Authority contributed to as well. This investment includes installing machines at ASU’s MacroTechnology Works that make materials for the next generation of AI and microelectronics chips.
The multimillion-dollar investment that ACA made in 2013 to MacroTechnology Works will enhance Arizona’s wafer-level packaging R&D and workforce training capabilities for Arizona.
All told, more than a dozen companies, ranging from local startups to multinational tech giants, have taken up residence at the park in Tempe and invested an additional $500 million in the facility and sponsored research agreements with ASU. This center of gravity has attracted still more microelectronics companies, as well as additional funding including government research programs.
In January, the U.S. Commerce Department announced that the new NSTC Prototyping and NAPMP Advanced Packaging Piloting Facility would be located in Arizona, adjacent to the MacroTechnology Works building. This facility will be home to bleeding-edge semiconductor prototyping, manufacturing and packaging equipment that isn’t available anywhere else in the world, creating a domestic R&D capability that is vital for America’s national security and maintaining its position as a global leader in semiconductor innovation.
ASU President Michael M. Crow put the state’s win in context, saying, “This is the largest of three CHIPS R&D flagship facilities being launched that together represent the greatest national laboratory investments since those that came out of the Manhattan Project.”
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ASU semiconductor efforts have paid off
Ten years ago and even before, ASU and other entities such as the Greater Phoenix Economic Council and ACA were already looking to semiconductors as Arizona’s future.
Crow, other leaders at ASU and GPEC understood that chips are required for everything.
Today, virtually all computer chips are made abroad and depend on a global supply chain that is increasingly dominated by China. Although the U.S. does produce some computer chips domestically, the vast majority of the chips in our phones, computers and other electronics are made by TSMC in Taiwan.
About a decade ago, ASU, the ACA and other organizations, including GPEC, launched a campaign to bring TSMC’s first fab in the U.S. to Phoenix. From GPEC’s perspective, what really sealed the deal was the workforce and research depth at ASU.
“ASU has thousands of graduates per year in mechanical and electrical engineering, which meant we could illustrate to TSMC that this was the market they should launch and scale from in the United States,” says Chris Camacho, outgoing president and CEO of GPEC.
In 2020, TSMC committed $12 billion to build a fab in Arizona, then expanded that to $165 billion for six fabs and two advanced packaging facilities. It’s the largest foreign direct investment in U.S. history.
As of this year, its first fab has started producing advanced 4nm chips for U.S. customers — the first time these types of chips have ever been produced on U.S. soil. The company’s second and third fabrication plants are currently under construction and when complete will produce 2nm chips, which are the most advanced commercially available chips in the world.
According to GPEC’s analysis, TSMC’s first three fabs alone will create 6,000 jobs and more than $33 billion in direct and indirect economic output for the people of Arizona. GPEC also estimates that for every job created in the semiconductor industry, it will also create five new jobs in other industries that support this new workforce, such as construction, restaurants and child care.
The downstream impact
The semiconductor industry depends on a vast network of interconnected suppliers. Arizona is unique in the U.S. because it has all elements of the semiconductor supply chain, which benefit both large companies, as well as semiconductor companies like Saras Micro Devices.
When Ron Huemoeller was tapped to lead Saras Micro Devices as its new CEO in 2023, one of his first major initiatives was finding a new home for the company because it was hard to find enough talent in Atlanta. So last year Huemoeller relocated the company to Chandler to benefit both from the proximity to other semiconductor companies and ASU.
“The primary driver to establish the headquarters in Arizona was because of the broad semiconductor ecosystem that is growing here,” says Huemoeller.
The company now employs 52 people, and more than 30 of them work in Chandler. Huemoeller says he expects the company’s head count to double by the end of 2026, with many new hires coming from ASU.
“We feel comfortable that we will be able to access the right people for our company here,” he says.
The semiconductor ripple effect
The semiconductor boom’s economic benefits extend far beyond tech manufacturing. This trend is already visible across the Valley, from construction companies working on fab builds to restaurants opening.
One of the dozens of examples is Lee Chi Investment Group, a large food distributor and a local real estate investor. In 2024, Lee Chi acquired a shopping center in north Phoenix about 20 minutes from TSMC. At the time, the shopping center was only about 75% occupied but, with TSMC so close, is now growing.
“At this location, people are coming to us because they see the opportunity; usually we have the opposite problem,” says Julia Li, director of operations for the group.
Preparing tomorrow’s workforce
ASU’s engineering program graduates more than 7,400 students a year. These graduates are essential to the semiconductor companies’ success.
“Companies like Intel and TSMC need an excellent, well-trained workforce and a lot of people,” Holman says. “ASU has both the volume and quality of graduates to meet that need.”
One of those graduates is Taylor Gowdy, ’24 BSE in engineering (mechanical engineering systems), who was hired by TSMC Arizona in 2024 as an equipment engineer. She attended classes on ASU’s Polytechnic campus, which provided a hands-on, project-based emphasis.
“There are so many engineering opportunities here,” Gowdy says. “So if someone is looking to work in manufacturing, there will be a role that fulfills their interests.”
ASU has been working closely with Applied Materials, TSMC, Intel and dozens of other companies to understand their needs and tailor programs so that students develop the skills to land a job in the industry when they graduate.
“We work really hard to collaborate with our corporate partners to understand the workforce and build the curriculum to fill those gaps,” says Katie Smith, ’13 BS in biochemistry, ’17 MBA, a business development manager at ASU Knowledge Enterprise who leads microelectronics engagements.
A new economic foundation
For Phoenix, and Arizona more broadly, semiconductors represent more than just another industry. The semiconductor industry offers a sixth C — “chips” — that will be less cyclical and more future-proof.
“We’re entering a new era where chips are going to be the center of everything,” Camacho says. “Our economy is now going to be anchored to products that are integrated in the most sophisticated way into virtually every channel of technology.”
The numbers support this optimism. According to the Arizona Commerce Authority, in the last five years, there has been more than $200 billion in private investment in Arizona related to semiconductors.
“My children and my children’s children will look back at all the semiconductor growth that’s happening now and see that it was a pivotal point for Arizona’s economy,” Camacho says.
Author: A former staff writer at Wired magazine and founder of the deep tech PR and marketing agency HAUS, Daniel Oberhaus is an ASU alumnus, ’15 BA in English (creative writing) and philosophy, and a graduate of Barrett, The Honors College. This story was featured in the fall 2025 issue of ASU Thrive.
