May 22, 2024

TSMC’s debacle in the American desert

In the 1980s, companies like Intel and Texas Instruments designed and made their own chips. TSMC set out to do something different

Meanwhile, chip manufacturing collapsed in the U.S. and Europe, and migrated to East Asia, drawn by government incentives. 

Inside TSMC’s struggle to build a chip factory in the U.S. suburbs

Taiwan Semiconductor Manufacturing Company (TSMC) was slated to open a plant in Phoenix, Arizona in 2024. It aimed to bring thousands jobs, but the expansion hasn’t taken off.

Bruce thought he’d landed his dream job. The young American engineer had been eager for a stable, high-paying job in the semiconductor industry. Then, in late 2020, he received a LinkedIn message from a recruiter for Taiwan Semiconductor Manufacturing Company. Bruce read up on TSMC — the leading global manufacturer of advanced chips — and got excited. The job sounded like he’d be “pushing the boundaries of human technology,” he recalled to Rest of World.

TSMC was undergoing a transformation at just about the same time Bruce heard from the recruiter. The coronavirus pandemic was exposing deep faults in supply chains, and a global chip shortage had slowed production of cars, smartphones, and refrigerators around the world. Meanwhile, American policymakers were rallying around what would eventually become the CHIPS and Science Act, a sweeping piece of legislation designed to boost semiconductor manufacturing in the U.S. TSMC, which makes most of its chips in Taiwan, was under pressure to expand its global manufacturing capacities.

Bruce would be working as a semiconductor engineer. The recruiter explained that he would first spend more than a year in Taiwan learning the ins and outs of the complex chipmaking process. Then, he’d return to Arizona. There, in a cactus-dotted suburb of Phoenix, TSMC was building a sprawling new factory to make the kind of chips that power iPhones and U.S. fighter jets. He’d be helping bring America’s newest chip factory online. Bruce was in.

But over the next two years, Bruce came to realize that the reality of working at TSMC wasn’t exactly what he had envisioned. While working on nanometer-level processes to make state-of-the-art chips, he struggled with language barriers, long hours, and a strict hierarchy. Bruce soon began second-guessing what he had signed up for. The plant, which was originally set to begin operating in 2024, fell woefully behind schedule; production at the facility is now set to start in 2025. Bruce, who said he signed a confidentiality agreement with TSMC, requested anonymity for this story.

He wasn’t the only one disappointed with TSMC’s progress in Arizona — other U.S. workers who spoke to Rest of World echoed Bruce’s concerns. In the past two years, the company has relocated hundreds of Taiwanese workers and their families to Arizona. Instead of a gleaming new facility, these workers found an active construction site, and a company struggling to bridge Taiwanese and American professional and cultural norms. 

Over the past four months, Rest of World spoke with more than 20 current and former TSMC employees — from the U.S. and Taiwan — at the Arizona plant. All of them requested anonymity because they were not authorized to speak to the media or because they feared retaliation from the company. In February, Rest of World traveled to Phoenix to visit the growing TSMC complex and spend time with the nascent community of transplanted Taiwanese engineers. 

The American engineers complained of rigid, counterproductive hierarchies at the company; Taiwanese TSMC veterans described their American counterparts as lacking the kind of dedication and obedience they believe to be the foundation of their company’s world-leading success.

Some 2,200 employees now work at TSMC’s Arizona plant, with about half of them deployed from Taiwan. While tension at the plant simmers, TSMC has been ramping up its investments, recently securing billions of dollars in grants and loans from the U.S. government. Whether or not the plant succeeds in making cutting-edge chips with the same speed, efficiency, and profitability as facilities in Asia remains to be seen, with many skeptical about a U.S. workforce under TSMC’s army-like command system. “[The company] tried to make Arizona Taiwanese,” G. Dan Hutcheson, a semiconductor industry analyst at the research firm TechInsights, told Rest of World. “And it’s just not going to work.”

TSMC did not respond to a detailed list of questions from Rest of World.

TSMC’s facilities are located on the outskirts of northern Phoenix, surrounded by miles of desert hills and wide roads. A glass-walled office building sits next to a massive parking lot, with a fountain in the shape of a round silicon wafer just in front of the facility gates.

Next to the office building are the incomplete manufacturing facilities. Originally slated to open in 2024, the facilities resemble giant stadiums. Once complete, the entire complex will cover 1,100 acres, or the equivalent of 625 football fields.  

At lunch hour on a Monday in February, Taiwanese and American engineers walked in and out of the office building with badges, hard hats, and see-through backpacks — which make it easier and faster for workers to pass through security checks.

TSMC got its start thousands of miles away from Arizona’s arid desert — on the northern coast of Taiwan. Morris Chang, a U.S.-educated chip engineer who spent 25 years at Texas Instruments, founded the company in 1987. He did so at the invitation of the Taiwanese government, which was eager to boost the island’s economy at the time.

A photograph showing a man wearing a suit, standing at a podium with the TSMC logo.
Morris Chang, founder of TSMC, speaks at the company’s facility in Phoenix in 2022. Adriana Zehbrauskas/The New York Times/Redux

In the 1980s, companies like Intel and Texas Instruments designed and made their own chips. TSMC set out to do something different. Chang’s company would focus solely on contract manufacturing: Customers would send designs, and engineers in the company’s fabrication plants (also called “fabs”) worked to perfect production methods, minimize the number of defective chips, and reduce costs.

The model proved a success. “All of a sudden it’s really efficient,” Hutcheson, of TechInsights, told Rest of World. “You can learn to become a plumber. But at the end of the day, it’s more efficient for you to focus on what you make money doing and then pay someone else to come do [the plumbing].”

Meanwhile, chip manufacturing collapsed in the U.S. and Europe, and migrated to East Asia, drawn by government incentives. Hutcheson said the high costs of building new facilities prevented new companies from joining the competition and eventually solidified TSMC’s dominance.

TSMC has since grown into a $660 billion giant that has allowed “fabless” chip designers such as Nvidia and Apple to flourish. The company is now able to cram more computing power into less space than almost any other chip manufacturer. Samsung and Intel are still trailing behind the Taiwanese company.

TSMC is also considered Taiwan’s most important company, with Taiwanese people dubbing it a “divine mountain that guards the nation.” The world’s dependence on TSMC, locals reason, could even incentivize the West to defend Taiwan from a potential invasion from China. The loss of Taiwan and with it TSMC — the thinking goes — would result in a global tech meltdown.

TSMC insiders told Rest of World the key to the company’s success is an intense, military-style work environment. Engineers work 12-hour days, and sometimes weekends too. Taiwanese commentators joke that the company runs on engineers with “slave mentalities” who “sell their livers” — local slang that underscores the intensity of the work.

Up until the pandemic, it made sense for TSMC to concentrate its operations in Taiwan, where it enjoyed unwavering government support, low operating costs, and access to the island’s top talents. Outside a small plant in Washington and two plants in mainland China that made chips with older technologies, the company had little interest in international expansion.

That changed in the late 2010s, as governments came to realize the geopolitical importance of the semiconductor industry and launched a race to attract chip manufacturing giants. Around 2019, the Trump administration started courting TSMC to build a larger and more advanced plant in the U.S. The pandemic further underscored supply-chain weak points. “The world has changed,” Sujai Shivakumar, director of the Renewing American Innovation Project at the think tank Center for Strategic and International Studies, told Rest of World. Depending on chips from a faraway country on China’s doorstep suddenly felt precarious. “What was purely — from an economics point of view — an efficient solution is no longer an efficient solution because of the geopolitics,” Shivakumar said.

In May 2020, then U.S. Under-Secretary of State Keith Krach announced that TSMC had agreed to open a $12 billion facility in Arizona. The site would create thousands of jobs, spur cutting-edge research, and attract more companies on the semiconductor supply chain to move to the U.S. Chips coming out of the plant were expected to power smartphones, 5G base stations, and advanced F-35 fighter jets. “This means that chips critical to our lives and national security will once again be made in America,” Krach said. 

TSMC’s investment, Krach later told U.S. media, inspired policymakers to extend incentives to the entire chip industry. In the summer of 2022, the Biden administration passed the CHIPS Act, which designated $53 billion to developing the domestic semiconductor industry. Later that year, TSMC said it would build a second fab at the same site in Phoenix, increasing its total investment to $40 billion.

A photograph of construction workers moving metal equipment in a dark environment.
Construction workers at the TSMC facility in Phoenix in 2022. Brendan Smialowski/AFP/Getty Images

Despite the commitment from both TSMC and Washington, issues related to exporting a Taiwanese-style work culture to the U.S. swirled from the outset. Morris Chang, who retired in 2018 but remains the public face of the company and the godfather of Taiwan’s semiconductor industry, cast doubts on the Phoenix initiative. 

When Nancy Pelosi visited Taiwan in 2022, Chang lectured the House speaker on the challenges the U.S. would face in mastering the microscopic precision required in chip production. Chang has since also warned against the lack of manufacturing talent in the U.S., and how hard it would be for Taiwanese managers to supervise Americans. Speaking to the Vying for Talent podcast in April 2022, Chang concluded that the U.S.’ attempt to onshore semiconductor manufacturing would be “a very expensive exercise in futility.”

In 2021, as construction kicked off in Arizona, TSMC flew Bruce and about 600 American new hires to the southern Taiwanese coastal city of Tainan. There, they’d spend more than a year training at Fab 18, TSMC’s most advanced mass production plant. 

Upon arriving at the facility, Bruce handed in his smartphone and passed through metal detectors. He was in awe of the semiconductor production line: Overhead rails carried wafers from one station to another while workers in white protective suits kept the machinery running. “It really just felt like I was touring some kind of living thing that was greater than humans; that was bigger than us,” Bruce recalled. 

But the challenges were immediately apparent, too. At Fab 18, nearly all communication took place in Taiwanese and Mandarin Chinese, the two most widely spoken languages in Taiwan. The Americans found it difficult to understand meetings, production guidelines, and chatter among local engineers. In theory, every American was supposed to have a Taiwanese buddy — a future Arizona worker who would help them navigate the workplace. But the Americans said their buddies were often too busy to help with translations, or else not familiar enough with the technical processes because they were freshly transferred from other production lines. 

Many trainees, including Bruce, relied on Google Translate to get through the day, with mixed results. Technical terms and images were hard to decipher. One American engineer said that because staff were not allowed to upload work materials to Google, he tried to translate documents by copying Chinese text into a handwriting recognition program. It didn’t work very well. 

One former American TSMC engineer who trained in Taiwan said his manager instructed him to follow along with daily handover meetings, which were conducted in Mandarin, just by looking at the associated PowerPoint presentations. “I was mind-blown at his expectations,” he told Rest of World. “I love challenges and pushing myself, but this was lunatic-level leadership.”

A photograph showing the entrance to the TSMC headquarters in Taiwan with a guard standing at attention.
TSMC’s headquarters are located in Hsinchu City, Taiwan. Chris Stowers/Panos Pictures/Redux

TSMC’s work culture is notoriously rigorous, even by Taiwanese standards. Former executives have hailed the Confucian culture, which promotes diligence and respect for authority, as well as Taiwan’s strict work ethic as key to the company’s success. Chang, speaking last year about Taiwan’s competitiveness compared to the U.S., said that “if [a machine] breaks down at one in the morning, in the U.S. it will be fixed in the next morning. But in Taiwan, it will be fixed at 2 a.m.” And, he added, the wife of a Taiwanese engineer would “go back to sleep without saying another word.”  

During their visit, the Americans got a taste of the company’s intense work culture. To avoid intellectual property leaks, staff were banned from using personal devices inside the factory. Instead, they were given company phones, dubbed “T phones,” that couldn’t be connected to most messaging apps or social media. In one department, managers sometimes applied what they called “stress tests” by announcing assignments due the same day or week, to make sure the Americans were able to meet tight deadlines and sacrifice personal time like Taiwanese workers, two engineers told Rest of World. Managers shamed American workers in front of their peers, sometimes by suggesting they quit engineering, one employee said. 

TSMC made attempts to bridge some of the cultural differences. After the American trainees asked to contact families and to listen to music at work, TSMC loosened the firewall on T phones to allow all staff access to Instagram, YouTube, and Spotify. Some Taiwanese workers attended a class on U.S. culture, where they learned that Americans responded better to encouragement rather than criticism, according to an engineer who attended the session.

But both American and Taiwanese engineers said that the training for new hires was largely insufficient. Managers excluded Americans from higher-level meetings conducted in Mandarin, according to one ex-TSMC engineer. Some of the Americans said that they rarely had a chance to handle problems themselves, and were mostly tasked with observing. “It’s like math in school,” Bruce said. “You can watch your teacher do 500 practice problems on the chalkboard, but if you don’t do some problems on your own, you are going to fail the test.”

As training went on, tensions mounted. U.S. engineers told Rest of World that some Taiwanese male engineers had calendars with bikini models on their desks and occasionally shared sexual memes in group chats. A female American colleague, according to an American trainee who witnessed the conversation, asked a Taiwanese engineer to remove his computer wallpaper depicting a bikini model. One former American engineer said some local co-workers referred to him as a “white breeding pig,” implying he was only in Taiwan to sleep with local women. At a meeting, a manager said Americans were less desirable than Taiwanese and Indian workers, according to people who saw leaked notes, which circulated among trainees.

“They really are trying to push this narrative that Americans are slower because of lower technical ability, but I really don’t believe that’s the truth,” an American engineer who recently left TSMC told Rest of World. “The Taiwanese create this false sense of urgency with every single task, and they really push ‘you need to finish everything immediately.’ But it’s just not realistic for people that want to have some normal work-life balance.”

Several former American employees said they were not against working longer hours, but only if the tasks were meaningful. “I’d ask my manager ‘What’s your top priority,’ he’d always say ‘Everything is a priority,’” said another ex-TSMC engineer. “So, so, so, many times I would work overtime getting stuff done only to find out it wasn’t needed.”

Training in Taiwan, which typically lasted one to two years, wasn’t all miserable, the Americans said. On the weekends, the trainees traveled across the island, marveling at the country’s highly efficient public transport network. Bruce spent his weekends hiking and frequenting nightclubs. He chatted with the families that run night-market food stalls, and entertained strangers who requested selfies with foreigners. 

Still, at least dozens of trainees quit before the end of training, according to the American employees. TSMC announced a recurring retention bonus in 2022. The remaining American workers began speculating that the company only hired them to secure CHIPS Act funding, Bruce said. But he stayed on: He wanted to see TSMC come to life in Arizona.

In late 2022, the employees began migrating from humid southern Taiwan to the desert of northern Phoenix. The group included the Americans, as well as hundreds of Taiwanese employees who would help install tools, manage suppliers, and prepare the Arizona plant for mass production. 

For the Taiwanese, many of whom planned for extended stays in Phoenix, that meant relocating entire families — toddlers and dogs included — to a foreign country. Many regarded it as a once-in-a-lifetime opportunity to explore the world, practice English, and send their children to American schools. Younger families planned pregnancies so they could give birth to American citizens. “If we are going to have children, of course we will have them here,” a Taiwanese engineer told Rest of World. “As an American citizen, they will have more options than others.” 

To cover the high living costs, TSMC provided the Taiwanese workers with stipend for cars and housing. Some families moved into apartment complexes reserved for employees, dubbed “TSMC villages.” Local schools introduced Mandarin visual aids in classrooms for Taiwanese pupils. A Chinese Baptist church in Phoenix organized English-language classes, taught by earlier generations of Taiwanese immigrants, to help the newcomers settle in.  

Many experienced a culture shock. The bustling cities of Taiwan are densely packed and offer extensive public transport, ubiquitous street food, and 24-hour convenience stores every few blocks. In northern Phoenix, everyday life is impossible without a car, and East Asian faces are scarce. “Everything is so big in America,” said one engineer, recalling his first impression. He recounted his wife summarizing her impression of the U.S.: “Great mountains, great rivers, and great boredom.” 

The Taiwanese engineers brought with them the intense TSMC work culture. Having spent years under the company’s grueling management, they were used to long days, out-of-hours calls, and harsh treatment from their managers. In Taiwan, the pay and prestige were worth it, they told Rest of World — despite the challenges, many felt proud working for the island’s most prominent firm. It was the best job they could hope for.

But the American workers didn’t have the same sense of loyalty. In the U.S., engineers had a plethora of job options that provided competitive pay and abundant personal time. The Taiwanese workers described their Phoenix colleagues as arrogant, carefree, and more willing to challenge orders. “It’s hard to get them to do things,” a Taiwanese engineer in Phoenix told Rest of World.

Bruce said that working conditions didn’t improve for the Americans once they relocated to Arizona. The American workers did not get more say in how the company was run, and they found the obsequiousness of their Taiwanese colleagues irritating. TSMC workers were asked to draw up reports and keep other documents in a PowerPoint format so that they could regularly make presentations to upper management. The Taiwanese employees were used to it, while the Americans became impatient with typing up weekly work reports. The Americans also resented that Taiwanese colleagues stayed late at the office for no good reason. “That pisses me off,” Bruce said. “They were just doing it for show.”

Five former employees from the U.S. told Rest of World that TSMC engineers sometimes falsified or cherry-picked data for customers and managers. Sometimes, the engineers said, staff would manipulate data from testing tools or wafers to please managers who had seemingly impossible expectations. Other times, one engineer said, “because the workers were spread so thin, anything they could do to get work off their plate they would do.” Four American employees described TSMC culture as “save face”: Workers would strive to make a team, a department, or the company look good at the expense of efficiency and employee wellbeing. 

In mid-2023, TSMC announced delays in the construction of its first facility in Arizona, dubbed Fab 21 — production at the facility would start in 2025 instead of 2024 as planned. TSMC blamed a shortage of skilled workers. Construction unions, however, complained of safety hazards and questioned if TSMC was using this as an excuse to bring in cheap labor from Taiwan. 

Engineers who were supposed to run production lines were reassigned to work remotely for Fab 18 back in Tainan, and asked to join late-night meetings. Some Americans and Taiwanese engineers were reassigned to help speed up the building of the facility, and asked to oversee construction workers. Clad in their clean-room suits and hard hats, engineers would sometimes collect trash at the unfinished sites. One ex-employee recalled colleagues collecting bottles of urine left by construction crews. 

Just like in Taiwan, language barriers contributed to tension in Phoenix. Bruce said his department manager, who had come from Taiwan, spoke poor English. So instead of communicating with Bruce directly, he’d channel feedback or instructions through a Taiwanese colleague. One U.S. engineer said managers trusted Taiwanese workers with important tasks, starving the Americans of hands-on experience. One ex-employee later joked that the biggest skill he learned at TSMC was making PowerPoint slides. 

Disgruntled Americans flocked to post complaints to workplace review website Glassdoor, reporting long hours, high stress, unrealistic deadlines, and “Asian culture.” TSMC currently has a rating of 3.2 out of 5 stars on the site. American chipmakers Intel and Texas Instruments, by comparison, have a 4.1 rating. The poor Glassdoor rating made it more difficult for TSMC to hire experienced American workers, a former TSMC manager told Rest of World. Another former employee said he convinced six engineer friends to turn down offers from TSMC.

The company made further attempts to adapt to American work culture. In early 2023, TSMC held weekly English-language and cultural classes for Taiwanese managers. A former TSMC staffer who worked on the education program said managers were instructed not to yell at employees in public, or threaten to fire them without consulting human resources. “They would say, ‘Okay, okay, I get it. I’m not going to do that,’” the employee recalled to Rest of World. “But I think in the heat of the moment, they forgot, and they did do it.”

Taiwanese managers were reminded not to ask employees why they were taking sick leave, or ask female job applicants about their plans to have children — an illegal yet common question in Taiwan. An ex-TSMC engineer said the company once sent an email reminding staff that the commonly used Mandarin term “nei ge” — which means “that” — could sound like the N-word.

In December 2023, following months of negotiations, TSMC made a deal with Arizona construction labor unions, agreeing to develop a workforce training program, maintain transparency on site safety, and focus on hiring locally.

Meanwhile, some American engineers started seeking out opportunities at companies with less strenuous expectations and better career prospects. Workers started joking that joining TSMC was a stepping stone to Intel, which was also expanding in Arizona at the time. An engineer, who has worked at both Intel and TSMC, said Taiwanese colleagues had also asked him about vacancies at Intel, where they expected a better work-and-life balance. 

Several American former employees said they felt relief after quitting. In group chats, engineers celebrated the departure of their friends. “TSMC was the worst possible place to work on Earth,” one American ex-TSMC engineer told Rest of World. Another, who recently left the company, described TSMC as having “a purely authoritarian work structure.”

Bruce resigned in 2023. He is still friends with his Taiwanese former colleagues, and kept his TSMC badge, water bottle, and TSMC T-shirt as mementos. He said he felt triumphant walking out. The American workers had voiced their concerns in meetings with management, but he didn’t see changes happening. “All of us gave them every chance to listen, but they never did,” he told Rest of World.

Three years after construction began, the first planned Phoenix plant is still incomplete. During an earnings call in April, TSMC chief executive C.C. Wei said the facility had entered “engineering wafer production,” meaning it’s making prototype wafers to prepare for commercial operation next year. In January, TSMC announced further delays at its second facility, too. Originally set to begin operations in 2026, it won’t open until 2027 or 2028. 

Chang-Tai Hsieh, an economics professor at the University of Chicago, told Rest of World that TSMC had found the U.S. a challenging environment to operate in because of the complicated regulatory process, strong construction unions, and a workforce less used to the long hours that are commonplace at TSMC in Taiwan. “TSMC’s profits from their U.S. fabs will be lower, unless their clients are willing to pay more to source from the U.S. fabs,” Hsieh said. “The only thing they need Phoenix for is to make sure that the U.S. government doesn’t turn against them.” In 2023, TSMC made more than 65% of its revenue from customers in the U.S. In the April earnings call, chief executive Wei said customers needed to share the high costs of producing outside Taiwan. 

More at:

The Race for Semiconductor Supremacy

The race for semiconductor supremacy | FT Film

The US is bidding to regain a leading role in advanced chip manufacturing, to de-risk critical supply chains, and to combat China’s rise as a technological superpower.

‘They would not listen to us’: inside Arizona’s troubled chip plant

‘They would not listen to us’: inside Arizona’s troubled chip plant

Taiwanese microchip manufacturer TSMC blames struggle to build Phoenix plant on skilled labor shortage but workers cite disorganization and safety concerns

osed in front of an American flag and a large banner reading “A Future Made in America Phoenix, AZ,” Joe Biden told a crowd of assembled workers, supporters and media last December: “American manufacturing is back, folks.”

Eight months on, the Phoenix microchip plant – the centerpiece of Biden’s $52.7bn US hi-tech manufacturing agenda – is struggling to get online.

The plant’s owner Taiwan Semiconductor Manufacturing Company (TSMC), the largest chip maker in the world, has pushed back plans to start manufacturing to 2025, blaming a lack of skilled labor. It is trying to fast-track visas for 500 Taiwanese workers. Unions, meanwhile, are accusing TSMC of inventing the skills shortage as an excuse to hire cheaper, foreign labor. Others point to safety issues at the plant.

The success of the plant – in a crucial swing state – is likely to get even more scrutiny as Biden prepares for the 2024 election cycle and US tensions with China over technology, and Taiwan, escalate.

Biden signed the Chips and Science Act, which includes $52.7bn in loans, grants and other incentives, and billions more in tax credits for manufacturers to produce the chips in the US, in August 2022.

The Arizona project is the flagship in the president’s efforts to tout the law’s effects and TSMC’s promised $40bn investment in US chip production plant is one of the largest foreign investments in US history and the largest ever in Arizona.

The stakes could not be higher. Semiconductor chips are the essential components of computers, smartphones and other electronic devices, and the coronavirus pandemic exposed how vulnerable the US had become to imported chips. About 12% of semiconductor chips are made in the US, down from 37% in 1990. Boosting US production will add thousands of jobs as well as securing US supplies at a time of worsening relations with China, whose rapidly growing industry accounts for about 9% of global semiconductor sales.

The Phoenix semiconductor manufacturing facility, or “fab”, is a huge undertaking, encompassing a 1,000-acre area north of Phoenix, set to include two fab facilities. Construction is expected to generate 21,000 construction jobs, with the workforce at the facilities estimated at about 4,500, and thousands of additional jobs at suppliers in the area.

But the construction of the plant has been hampered by accidents and misunderstandings, according to insiders who spoke to the Guardian.

A former supervisor at the site explained all contractors at the site operate under the management of two companies affiliated with TSMC, United Integrated Services (UIS) and Marketech International Corp, and blamed delays on disorganization from management and a lack of knowledge by bosses from Taiwan on adhering to safety codes and regulations in the US.

If you disagreed, they threatened “to take work from you and give it to somebody else”, they said. They requested to remain anonymous for fear of retaliation from their general contractor employer. “Then the non-union contractors couldn’t get enough guys out there who were skilled enough.”

They said when they started working at the site, all workers went through a safety training program, but out in the field, they never saw the people who ran that program or safety protocols enforced.

“There were multiple general contractors all in the same little areas, all of them saying different things. Nobody ever coordinated anything; everybody was always in each other’s way, people were storing material everywhere, and it was constantly holding up little projects,” they said.

They explained the main contractors would give them a priority task to complete, but that it would change daily, or they would completely change their mind, making it impossible to complete tasks and add to delays.

“When you have to put stuff up, tear it down, put it up, tear it down, literally five or six times, that’s going to cost five or six times the original quote, probably more because you have to get demolitions involved,” the worker said. “This was constantly the whole process. Everything was rushed. They weren’t giving us actual blueprints, just engineer drawings. It felt like a design-as-we-go type of deal. The information we were getting was really strange, never complete, and always changing. We would get updates constantly and these were big updates to the point where we would have to start pulling things down.”

The worker also criticized frequent evacuations of the job site that occurred mostly due to false alarms and other communication issues that delayed work. They described long traffic lines and wait times to travel in and out of the job site that worsened whenever it rained because of the mud and said the constant turnover of contractors for different job tasks made it even more hectic.

They also noted that portable toilets were too few and were never properly cleaned or stocked with toilet paper and soap, probably resulting in workers getting sick. The worker said instead of calling 911 for safety emergencies, workers were directed to call an internal safety hotline, but that those medical services always took a long time to respond.

“I’ve never been on a job site like this. A job site this big with this many people, you have to be super safe, everything kind of has to slow down because you’re always in somebody’s way, so you have to have a perfect plan if you want to pull this off,” they concluded. “I think they need to get those Taiwan contractors out of there because they are not used to building in America at all. They’re hiring us as professionals to give them a quality installation and advice and direction on how to install things, but they would not listen to us at all.”

Workers and local unions have disputed TSMC’s characterization of the workforce and reasons for the delays. The Arizona Pipe Trades 469 is currently petitioning against TSMC’s application for 500 visas for workers from Taiwan to build the facilities.

A TSMC spokesperson characterized these new visa applications as part of a new phase of construction in the project to install process equipment.

“To ensure this critical phase of tool installation goes smoothly and successfully, it is a very common practice in the semiconductor industry to have a very limited number of experienced specialists from different overseas locations onsite to assist with important steps in the process. These experienced individuals have deep familiarity with our supplier equipment and will partner with our strong local workforce during this phase,” said the spokesperson in an email.

In an op-ed, Aaron Butler, president of the Arizona Building and Construction Trades Council, criticized TSMC’s announcement as an attempt to endanger American jobs and disputed claims from TSMC that the US workforce lacks the experience and skills required to complete construction.

“Blaming American workers for problems with this project is as offensive to American workers as it is inaccurate,” Butler wrote. “TSMC is blaming its construction delays on American workers and using that as an excuse to bring in foreign workers who they can pay less.”

In June, the American Prospect reported the site had been dogged by mistakes, injuries, safety issues. TSMC has refused to sign a project labor agreement with local labor unions, leaving the majority of the workforce to non-union contractors, and unions have reported an influx of Taiwanese workers at the job site in lieu of union-backed positions after incentive wages were cut for electricians at the site.

Another former worker at the site in 2022 who requested to remain anonymous for fear of retaliation from their contractor employer, told the Guardian they experienced numerous issues working on the site, from not being paid for hours worked to health issues from chemical exposure on the site.

“The guys were spraying fireproof chemicals on the I-beams. It didn’t matter if you were having lunch, they’d just spray right above you. Everyone out there had the same cough. I’m sure it was because of that. I left the job and my cough cleared up a month later,” the worker said.

TSMC did not respond to specific safety complaints and issues, but a spokesperson said in an email, “TSMC is deeply committed to workplace safety in the operation of all our facilities, along with each of our active construction projects, including TSMC Arizona. We are regularly audited against known safety standards by organizations such as Arizona Department of Safety and Health (ADOSH). TSMC also conducts its own internal audits of safety records against state and national figures.

“In Arizona, our recordable safety incident rate is nearly 80% lower than nationally reported figures, and our lost-time incident rate is almost 96% lower.”

TSMC’s only other US fab, located in Camas, Washington, experienced similar issues in its construction and development. It first opened in 1998, but plans to build additional factories at the Wafertech site never panned out.

In a 2022 interview, TSMC’s founder, Morris Chang, said the facility struggled to find enough staff and that costs exceeded expectations and told the then House speaker, Nancy Pelosi, during a visit to Taiwan the same year that US efforts to rebuild chip manufacturing domestically were “doomed to fail”. In 2013, the IBEW union attempted to organize electricians at the site but were met with staunch anti-union resistance from the company.

A former Wafertech employee who requested to remain anonymous due to signing a non-disclosure agreement told the Guardian that Wafertech told American employees during an all-staff meeting that they were all lazy. (In July 2023, a popular Taiwanese YouTube channel accused the Arizona workers on the TSMC site of being lazy.)

“We were in shock and angry. The man that told us we were lazy during the all-employee meeting was the president of Wafertech at the time, Steve Tso,” they said. “Anyone in the hi-tech world understands how tightly these processes are run. Nothing is done without a procedure in place. To say that there are no Americans to do this part of the job is nonsense.”

A local representative for Wafertech did not comment directly on the remarks from Chang or the former employee but said in an email that WaferTech had been a successful member in the TSMC family over the past 20 years. “Internal employee meeting communications are confidential, but my recollection from those early days is that all of us were asked to give 100% effort to help Wafertech succeed.”

One of the former TSMC workers concluded that workers were being buffeted by the political drama between the US and China. TSMC is economically vital to Taiwan, which has faced increasing diplomatic and military pressure from China as the company is expanding its global production with historic investments in the US.

“A lot of us feel TSMC is only dealing with the union and trying a little bit at all because they want that Chips Act money, they’re chasing it,” they added. “The US is just worried about getting their microchips because of all the drama with China and we’re kind of dragged into it.”

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