Currently, all attention is focused on chip manufacturers as the U.S. aims to take control of the semiconductor market. The government is pushing to shift more semiconductor production to American soil, which has created some instability in the tech sector. A recent report highlights that the CHIPS Act, designed to promote domestic chip manufacturing, is facing challenges due to significant layoffs in the industry.

The tech sector has experienced mass layoffs over the past couple of years, with tens of thousands of employees losing their jobs. Interestingly, these layoffs are not a result of fluctuations in the global stock market or advancements in artificial intelligence. Instead, they are linked to the policies of former President Donald Trump, a surprising twist for many.

The CHIPS Act, which stands for Creating Helpful Incentives to Produce Semiconductors, was introduced under former President Joe Biden to stimulate semiconductor production within the U.S. The initiative provided additional funding for the establishment of manufacturing plants. However, with a new presidential term, it was anticipated that some policies would be reconsidered.

New administrations often seek to dismantle initiatives introduced by their predecessors, whether for ideological reasons or simply out of spite. According to the report, Trump has labeled the CHIPS Act a misuse of government funds. His proposed alternative?

Increasing tariffs to compel foreign nations to pay more for imported goods as a way to stimulate domestic manufacturing. The implications are severe; the CHIPS Act has seen an alarming 80% layoff rate, which could cripple any organization. This surge in unemployment adds to the growing number of displaced government workers since the new administration took over.

While Trump views this as a viable strategy, concerns are rising among industry leaders, including Samsung and SK Hynix, who fear for the future of their Texas plant projects. The path ahead remains uncertain, and the expected outcomes are unlikely to be favorable.