Part of the Building America’s Industrial Base Series
By Spencer Lau, Sean Killeen, and Vivian Yu
The U.S. semiconductor industry is entering a period of rapid expansion, driven by growth in AI, advanced computing, and data center investment. Demand is reaching new highs, while billions in investment to expand manufacturing capacity are reshaping where and how chips are produced in the United States.
The opportunity extends well beyond the fabs themselves. Growing investment and capacity are creating demand across construction, materials, equipment, precision manufacturing, logistics, and facility services. This industry report, part of Next Street’s Building America’s Industrial Base research series supported by JPMorganChase, examines where supplier opportunities are emerging and what it will take for small and mid-sized businesses and regional ecosystems to capture them.
Key Takeaways
AI is accelerating semiconductor demand. Global semiconductor sales reached a record $796 billion in 2025, with advanced computing emerging as the industry’s largest end market as AI and data center investment grows.
Investment in chip fabrication is reshaping the U.S. industrial footprint. More than $820 billion in private investment across 160+ U.S. projects has been announced since 2020, expanding domestic capacity and creating new manufacturing hubs.
The supplier opportunity extends well beyond chip manufacturing. Fab construction and infrastructure provide the broadest near-term entry points for small and mid-sized businesses, while materials, equipment, precision manufacturing, packaging, facility services, and logistics offer additional opportunities as production scales.
Anchor investments alone will not create strong local supplier ecosystems. Regions enter this growth cycle with very different supplier bases, and emerging hubs may require more active supplier development, qualification, and capacity building.
Workforce capacity could become a major constraint on supplier growth. The industry is projected to require approximately 189,000 additional workers through 2030, as smaller suppliers increasingly compete with large manufacturers for engineers, technicians, skilled trades, and other critical talent.
One Key Chart
The U.S. leads the global semiconductor market, but holds a much smaller share of wafer fabrication capacity
Sales by U.S.-headquartered semiconductor companies more than doubled from 2020 to 2025 to $425 billion, representing over 50 percent of the global semiconductor market.
Yet only about 10 percent of global wafer fabrication capacity was located in the United States, as of 2022. That gap between a strong U.S. market position and relatively limited domestic manufacturing capacity is driving new investment in fabs and the supplier base needed to support them.
Read the Full Industry Brief
Explore the full analysis of semiconductor market trends, the U.S. industry and supplier landscape, workforce dynamics, and the opportunities and challenges facing small and mid-sized businesses as domestic semiconductor capacity grows.
