Monday, September 20, 2021
Sept. 20, 2021

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In Our View: Land-use laws causing high-tech stagnation

The Columbian
Published:

Despite their small size, microchips are a big deal for the economy in Clark County and throughout the metro area. Keeping it that way will require a concerted effort from local leaders.

More than two decades ago, TSMC — a Taiwanese company that is one of the world’s largest semiconductor manufacturers — opened a plant called WaferTech in Camas. Owning 260 acres of land, TSMC floated the possibility of eventually opening a second plant on the site.

That has not happened, and when TSMC announced plans last year for an additional U.S. facility, executives chose Arizona despite attempts to lure it to Washington.

The scenario reflects the difficulties facing the Northwest’s semiconductor industry. Once billed as The Silicon Forest, the region’s high-tech industry is suffering from root rot.

Semiconductors are essential to modern life, providing the brains for everything from smart phones to home computers to automobiles, yet the United States accounts for only about 12 percent of global production. Taiwan, South Korea and Japan are among the leaders, and manufacturers have increasingly been attracted by cheap labor markets in Asia.

President Trump pushed to reverse that trend, and President Biden’s infrastructure proposal includes $50 billion to boost the semiconductor industry. With microchip manufacturing being an essential global industry filled with high-paying jobs, the Northwest must position itself to take advantage of future growth.

Industry analysts suggest that a half-dozen factories — called fabs in industry lingo — could be built in the U.S. over the next few years. But, as OregonLive.com reports: “None of the new fabs on the drawing board are in Oregon or Southwest Washington, even though the region has arguably the densest concentration of chip manufacturers and suppliers in the nation.”

The Northwest also has abundant water, cheap electricity and an educated workforce — as well as amenities attractive to prospective high-tech employees.

Those attributes helped attract Sharp, WaferTech and Analog Devices to Camas in recent decades as the city reconfigured its economic base. And it brought industry vendors such as Vancouver-based SEH America to the region.

But the industry has stagnated in the region, and the cause apparently is a lack of land. “The lack of large swathes of industrial land does pose challenges,” Nathan Buehler of Business Oregon told OregonLive.com. “The big players are looking for sites that are 1,000 to 1,500 acres for a new project.”

Urban growth boundaries in Washington and Oregon limit the availability of large tracts of land, leaving semiconductor companies to look elsewhere. Intel, Oregon’s largest private employer, has spent $3 billion over the past two years improving its facility in Hillsboro. But when it came time last week to announce an expansion for “a new era of innovation,” it chose its plant in New Mexico.

Land-use laws help preserve the lifestyle of the Northwest and prevent sprawl that would despoil rural landscapes, but they come at a cost by limiting large manufacturing industries.

Three decades ago, leaders throughout the Northwest demonstrated vision in attracting — and facilitating the growth of — high-tech industries. Motivated, in part, by a shrinking lumber industry, they saw the need for revamping the region’s economy and took action.

Retaining those industries as a linchpin in the future will require similar vision.

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