Ohio offered Intel Corp. incentives worth approximately 2 billion for the installation of a new chip factory in which it plans to invest $20 billion to, according to ABC News, alleviate its global shortage and create a new technology center in the Midwest.
Intel Corp, the world’s second-largest chipmaker, announced a week ago that it had chosen a site outside Columbus, Ohio, to set up two new chip manufacturing facilities.
Ohio Gov. Mike DeWine said the impact on jobs would go beyond Intel, activating thousands of related industries, such as equipment and materials suppliers, as well as restaurants and entertainment.
He called Intel’s announcement “monumental news” for the state. He also said the $20 billion projects would be the most significant investment by a single private company in the state’s history.
“Advanced manufacturing, research and development, and talent are part of Ohio’s DNA, and we are proud that chips—which power the future, will be made in Ohio by Ohioans,” DeWine said. The planned factories will be Ohio’s first semiconductor manufacturing plants.
In addition, Fortune indicated that with the construction of the new plants, Ohio would see significant economic growth and new jobs.
According to reports, the first part of the project is estimated to employ more than 7,000 workers, and the company anticipates 3,000 direct jobs with average annual salaries of $135,000.
The shortage in the U.S. of critical components used in automobiles, computers, and other electronic devices has created a complex situation in global supply chains, causing the prices of many goods and services to skyrocket.
Intel executives said that if Congress passes the $52 billion bill introduced to subsidize U.S. chip manufacturing and improve the U.S. competitive position against China, the industry could grow to become the largest in the world.
Of the new legislation, introduced this week, House Speaker Nancy Pelosi (D-Calif.) said in a statement, “The introduction of the vital America COMPETES Act of 2022 in the House is an important step forward to setting up a conference with the Senate-passed U.S. Innovation and Competition Act, so we can quickly negotiate a final bill for the president to sign into law.”
Ohio’s offer includes $600 million to help Intel offset the cost of building the factories, which is more expensive than it would be in Asia, said Lydia Mihalik, the state’s development director, according to ABC News.
In addition, the state Legislature approved a 30-year tax break for Intel that will save the company $650 million.