No sector better understands the importance of investing in research than the semiconductor industry, makers and designers of the tiny chips that are the brains of our digital world.

As the distance between transistors on a semiconductor continues to get smaller and is measured at the nanoscale, the need for research to maintain the breakneck pace of semiconductor innovation and to unleash new, transformative chip technologies has never been greater. Research has allowed the semiconductor industry to follow Moore’s Law to levels once unimaginable, and it will continue to help chart the path forward, one pioneering step at a time. 

It should come as no surprise that the U.S. semiconductor industry plows about one-fifth of its revenues into R&D each year, perennially ranking first or second among all industries. Over the last half-century, that sustained and intense investment has driven advances that are dramatic and unparalleled in other sectors, producing exponentially more advanced products at lower cost.

The speed of innovation has helped make the U.S. semiconductor industry one of America’s top exporters and advanced manufacturers, and a crucial contributor to our country’s overall strength. The semiconductor industry provides a quarter-million American jobs and supports an additional million. The U.S. industry accounts for nearly half of the world’s chip sales, and the United States is home to almost half of American semiconductor companies’ manufacturing base across 21 states.

Knowing how interwoven technology is with America’s economy, national security, and global competitiveness, the federal government for decades has been the largest funder of basic, precompetitive scientific research, supplementing massive private-sector investments in applied research. These federal dollars are credited with helping to create major tech breakthroughs that in many ways define today’s economy, from the Internet and GPS to the laser and the modern integrated circuit. 

Unfortunately, the U.S. government’s overall funding for R&D has fallen to a historic low as a percent of the size of our economy, even as our overseas competitors are ramping up their investments in research. The most recent edition of the National Science Foundation (NSF) Science and Engineering Indicators report— and other reports in this publication—have repeatedly shown that R&D investment is shifting East overall, with dramatic increases in Chinese investment leading the way. Without significant commitments by the U.S. government to increase R&D funding, China is likely to catch and even exceed U.S. investment by the next biennial NSF report. This may mean that more of tomorrow’s breakthrough inventions will happen elsewhere in the world.

Research in fundamental physics, chemistry, and even biology has the potential to unlock discoveries that could improve future generations of semiconductors. But without robust funding for these fundamental science investigations, we’ll never know what we don’t know.

Today, the semiconductor industry faces new challenges to carrying Moore’s mantle forward and innovating along a host of axes beyond just scale and cost. In 2017, the Semiconductor Industry Association (SIA) and the Semiconductor Research Corporation (SRC), which manages precompetitive basic research awards to universities co-funded by industry and government, came together to set a vision for semiconductor research in the years ahead. This vision document lays out 14 technical areas that need investment, from fundamental advances in materials, semiconductor devices, and chip packaging to new developments in manufacturing technology. With our partners in government, world-class colleges and universities, and national labs – our unique U.S. innovation ecosystem – we are hard at work on these challenges.

To keep this work going, however, we urgently need more robust investment in semiconductor-specific research programs funded by the federal government. Our competitors overseas are upping government investment in semiconductor research. The U.S. must rise to this challenge or risk falling behind.

Federal research dollars at the NSF, Department of Defense (DOD), the Department of Energy (DOE), and National Institute of Standards and Technology (NIST) support critical precompetitive semiconductor research programs – often in partnership with U.S. companies – and help train the next generation of the U.S. high-tech workforce. While programs at DOD have received significant support from both the Trump Administration and Congress, domestic agencies like NSF, NIST, and DOE’s Office of Science and Advanced Research Projects Agency – Energy (ARPA-E) have been proposed for flat funding or cuts in each of the Trump Administration’s first two budget requests.

One major, new DOD initiative is the Electronics Research Initiative (ERI), a $216 million effort funded through Defense Advanced Research Projects Agency (DARPA). The ERI brings together a host of programs in next-generation microelectronics technology and $75 million in new investments in this fiscal year for projects specifically aimed at innovations beyond traditional Moore’s Law scaling. The initiative will also leverage significant supplemental investments by industry partners awarded contracts through the program.

The ERI will focus on the development of new materials for use in electronics devices, nontraditional architectural approaches, and innovative circuit designs, among other research areas. In addition to fostering advancements in semiconductor technologies used for national security, the ripple effect from this research will be felt across the full range of semiconductor applications: communications, computing, health care, transportation, clean energy, and countless others.

There are other public-private semiconductor research partnerships driving leap-ahead innovations in chip technology. The DOE is hard at work on the next generation of high-performance computing – stretching to reach exascale computing with partners in private industry – and co-funded university research programs managed by SRC are exploring entirely new devices, materials, and computing architectures to lay the groundwork for semiconductor technologies a decade or more into the future.

Advances in semiconductor technology reverberate throughout society, making technology more affordable and accessible to consumers and boosting U.S. innovation, productivity, and economic growth. And the future holds even greater promise. Semiconductors are unleashing a surge of new industries and emerging technologies, such as artificial intelligence, virtual reality, cloud computing, the Internet of Things, and autonomous driving.

Nothing can stop this forward march of innovation, but one thing that can slow it down is a failure to invest in research. We must prioritize robust federal investment in research so we can strengthen the U.S. economy and ensure the United States remains the global leader in semiconductor technology. 

Josh Shiode is Director of Government Affairs at the Semiconductor Industry Association, the voice of the semiconductor industry in Washington, D.C.