Micron Technology Inc. has struck a union deal for construction of a $15 billion chipmaking facility, potentially giving the company an advantage in the fierce competition for federal funds.
The accord for the Boise plant is a rare example of an organized labor agreement in the country’s semiconductor industry, which Washington is trying to rebuild with subsidies worth $100 billion under last year’s Chips Act.
The Commerce Department, which plans to announce the first awards by the end of the year, has expressed a strong preference for applicants that have reached construction accords with unions known as project labor agreements.
Micron has also said it’s investing as much as $100 billion in New York state over the next two decades – and that the site there will be governed by such an agreement.
The company is trying to ensure a ready workforce and set itself apart from other semiconductor giants by partnering with organized labor across the board, said Manish Bhatia, Micron’s executive vice president of global operations.
“That partnership really positions us as the best partner to labor – and having that partnership to be able to make ourselves successful – of any of the Chips applicants,” Bhatia said in an interview.
“We do need those grants to be able to proceed with these projects,” he added.
The Chips Act provides $39 billion in direct grants as well as loans and loan guarantees worth $75 billion to support semiconductor manufacturing and supply-chain projects.
A representative for North America’s Building Trades Unions said the accord, which the labor organization helped negotiate between its regional affiliates and Micron’s general contractor, will ensure job site safety and support middle-class careers in Idaho.
Senate Majority Leader Chuck Schumer of New York said the agreement “only adds to Micron’s strength in prioritizing the creation of good-paying, union construction jobs.”
It covers the majority of some 3,700 construction workers that the company expects to hire at its peak, Bhatia said.
Some parts of the project, which were either completed or contracted before negotiations began in August, aren’t covered, but Bhatia said that unionized workers have been involved from the start.
The framework includes provisions for workforce training and incentives for traveling construction workers, with an emphasis on hiring locally, Bhatia said.
Micron expects to open the site for production in 2026 and says it could generate as many as 2,000 permanent jobs by the end of the decade.