U.S. Released New Childcare Guidelines For Semiconductor Chips Subsidy Program

The Biden administration on Monday will unveil new guidelines for its $52 billion U.S. semiconductor manufacturing and research program detailing how firms vying for major awards must provide affordable high-quality childcare.

The Commerce Department intends to start accepting applications in late June for a $39 billion manufacturing subsidy program. The law also establishes a 25% investment tax credit for building chip factories, gauged to be worth $24 billion.

This workforce guidance document reviewed by Reuters says the Commerce Department is “not requiring or expecting applicants to provide free care” but adds that those applying for funding “should strongly consider defraying the price of care such that it is within reach for low- and medium-income households.”

The department in the guidance highly recommends the use of project labor agreements with regard to construction projects and said applicants that do not pledge to use an agreement “will be required to submit workforce continuity plans and show that they have taken other measures to reduce the risk of delays in project delivery.”

These agreements are collective bargaining agreements between contractors and building trade unions.

The document specifies workforce development plans must include “specific commitments of proactive employer engagement and mobilization and efforts to train and hire workers into good jobs that offer competitive wages, including by offering programs to expand employment opportunities for economically disadvantaged individuals.”

“We won’t be able to build the semiconductor workforce needed unless more of America’s workers have the chance to get into these jobs,” Commerce Secretary Gina Raimondo said in a statement included with the guidance.

Some Republicans have voiced criticism about Commerce Department conditions including childcare requirements. The department in February said it would mandate companies to share excess profits in some instances.

Semiconductor companies have already announced over 40 new projects including around $200 billion in private investments to boost domestic production.