The Government Circuit: Ready to Tackle 2022

Happy 2022! I hope everyone had a safe and happy holiday season. 

As anticipated, it was a busy close to 2021 in Washington, and we saw resolutions on several major legislative priorities, including the annual defense authorization bill, which affects billions in future defense electronics spending. Meanwhile, negotiations on the U.S. Innovation and Competitiveness Act (USICA) remain on the back burner but could heat up in Q1. Read on for some of the recent highlights from 2021 and a look forward to 2022. 

It is an exciting time to be involved in our industry, and we hope you’ll remain engaged with IPC this year. We’re looking forward to building off our successes and, with your help, achieving more victories for the entire electronics manufacturing industry. 

New IPC Report to Warn U.S. Leadership in Electronics On ‘Brink of Extinction’
If the U.S. government (USG) wants to achieve greater innovation, resiliency, and security in the semiconductor supply chain, its investments in semiconductors must be paired with robust, multibillion-dollar investments in advanced packaging of chips and especially in advanced IC-substrates. 

Those were among the key findings of a new IPC report, which made 28 recommendations to address the gaps in industry capabilities and capacity in North America. We hope you’ll take the time to check it out and share it with your networks. 

Another IPC report is coming soon from IPC Thought Leadership Program member Joe O’Neil documenting longstanding gaps in the printed circuit board (PCB) sector and why PCBs deserve much more supportive USG policy. The report will caution that the lack of any significant USG support for the sector will continue to leave the nation dangerously exposed to foreign dominance of the electronics supply chain.

IPC will continue to make the case to policymakers that without investment in other areas in the electronics ecosystem, the United States will be unable to manufacture the cutting-edge electronics it designs. IPC is increasing its government advocacy and industry leadership on these issues in 2022. 

IPC Advocates for Transatlantic Cooperation on Resilient Supply Chains
The United States and Europe remain far behind international competitors in advanced packaging of printed circuit board assemblies (PCBAs), but we’re working to bring about a better policy environment to fix that. IPC recently made the case for a resilient electronics manufacturing ecosystem and further investments in advanced packaging at the inaugural meeting of the European Commission’s consultation on secure supply chains. IPC welcomed the transatlantic focus on secure supply of semiconductors under the U.S.-EU Trade and Technology Council (TTC) and plans to submit additional comments to the commission on this issue. IPC will continue to engage with policymakers to ensure the electronics value chain is recognized as central to economies on both sides of the Atlantic. 

The Electronics Supply Chain Outlook Remains Tenuous
2021 was a tumultuous year and many of the risk factors will continue through at least the first half of 2022. The onset of the Omicron variant has stalled any progress made on the supply chain outlook, and IPC’s latest reports on the industry’s sentiment and the global economic outlook suggest that many electronics manufacturers continue to struggle with a challenging environment. 

According to IPC’s January Global Sentiment Survey, nine in 10 electronics manufacturers report rising materials costs, and more than three-fourths reporting rising labor costs. Though order flows continue to be strong, and both capacity utilization and shipments are expanding, respondents reported growing backlogs and shrinking profit margins. 

These tight profit margins are expected to continue through at least the first half of 2022, and the trajectory of the economy may follow the trajectory of the COVID pandemic. Workforce issues also continue to hamper the industry, and the ease of recruiting skilled talent is expected to persist. 

For more on what supply chain challenges may lie ahead, be sure to check out IPC Chief Economist Shawn DuBravac’s Monthly Economic Outlook Report on the IPC website. Stay tuned for next month’s reports, and please reach out if you have any questions. 

U.S. Defense Missions Depend on Completing Lead-Free R&D
The U.S. defense and aerospace community’s reliance on outdated electronics designs is creating an opportunity for our rivals to surpass U.S. technology in the coming years. With lead-based electronics becoming more difficult and expensive for the Department of Defense (DoD) to procure, it is imperative to complete the transition to lead-free. The lead-free research funding level is due to be decided in Congress within the coming weeks. Read a recent op-ed by IPC member David Raby in AL.com for more on this issue1

Meanwhile, the U.S. Partnership for Assured Electronics (USPAE) was the recent recipient of an $8.95 million award from the DoD to grow the Defense Electronics Consortium (DEC) and expand its work on the Solder Performance and Reliability Assurance Project. Follow USPAE on LinkedIn or reach out directly to them if you have any questions. 

We expect there to be a growing focus on the security and resiliency of electronics supply chains, a long-neglected but critically important segment of the electronics manufacturing industry. IPC will continue to be at the forefront of this discussion and to advocate for a five-year, $40 million investment in a public-private research and development (R&D) program, which industry experts believe would yield more than $100 million in U.S. defense savings per year and improve military readiness and overall innovation. 

Biden Signs Compromise NDAA
Elsewhere in defense news, U.S. President Biden signed a compromise version of the National Defense Authorization Act (NDAA) on December 27. Notably, the $768 billion annual defense policy bill, which passed with bipartisan support and will increase the Pentagon’s budget by $24 billion, includes restrictions on acquisitions of certain printed circuit boards (PCBs) susceptible to interference by the Chinese government. The NDAA also contains numerous provisions for cleaning up military communities impacted by per- and polyfluoroalkyl substances (PFAS) contamination, but they are unlikely to affect electronics manufacturers. 

Dynamic Environmental Policy Landscape Expected in 2022
Environmental regulations continue to be a top-of-mind concern for our members, and the EU and U.S. regulatory agendas are crowded with chemical and product policies that will affect electronics manufacturers in 2022. 

In Europe, IPC expects revisions to the Registration, Evaluation, Authorization and Restriction of Chemicals (REACH) regulation, a review of the Restriction of Hazardous Substances (RoHS) Directive, and legislative action on the Sustainable Products Initiative. In the United States, we anticipate consultations on Toxic Substances Control Act (TSCA) risk evaluations and on the risk management of existing chemicals. 

Ramped Up Activity at U.S. EPA
The U.S. Environmental Protection Agency (EPA) had a busy 2021, and we found them to be receptive to our concerns. 

IPC, alongside our peer groups CTA and ITI, coordinated on a joint response offering industry support for the EPA’s proposed compliance deadline for phenol, isopropylated phosphate (3:1)—PIP (3:1)—a chemical substance used as a flame retardant and plasticizer in electronics. The joint comments also reiterated several requests for clarifications and exemptions for uses of PIP (3:1). In 2021, IPC engaged with industry members and the EPA to ensure a reasonable plan for a future prohibition of the manufacture and distribution of PIP (3:1) and articles containing this chemical substance. 

Meanwhile, on December 8, U.S. President Joe Biden signed an Executive Order (EO) that set environmental policy goals for the federal government to achieve by 2050. In one key area, the EO directed the federal government’s procurement efforts to prioritize “the purchase of sustainable products, such as products without added PFAS.” However, some PFAS are used to make electronics purchased by the federal government. This is an opportunity for the electronics industry to educate policymakers about the widespread use of PFAS, the risks associated with those uses, and the tradeoffs associated with trying to identify and implement safer alternatives. 

IPC’s environmental advocacy team will be busy monitoring and engaging on these topics for you in 2022. 

Which Government Policy Issues Are You Concerned About?
Our industry wins when you are active and engaged, and the success of our work depends on the active participation of IPC members. As you plan out your agenda for the start of the year, consider letting us know where you stand on the issues so we can best advocate for you now and in the future.

Throughout 2021, we asked IPC members about the key challenges they are facing. Allison Budvarson of Renton, WA., noted that trade and tariffs are "leading to component supply issues" and are having "a very real effect on my ability to ship product." Does this issue affect you? Let us know your top concerns via this five-minute, five-question survey as we kick off the new year.

IPC to Hold Virtual IMPACT Washington, D.C.
By the way, IPC’s signature U.S. advocacy event—IMPACT Washington, D.C.—will take place in March. We had hoped for an in-person IMPACT, but due to current uncertainties surrounding COVID-19 and the new omicron variant, policymakers are not expected to be taking meetings with large groups at that time. 

Although 2021 was a difficult year for many of us, we look forward to continuing to work with IPC members and policymakers to advance policies that promote increased innovation, investment, and growth in electronics over the coming decades.

Please let me know if you have any questions and suggestions for IPC advocacy this year. With your help, we can begin the new year in a strong position to advance our advocacy goals.

References
“Guest opinion: U.S. defense missions depend on completing Alabama-based R&D,” byDavid Raby, AL.com, Dec. 16, 2021. 

Chris Mitchell is IPC’s VP of global government affairs. Contact him at ChrisMitchell@ipc.org

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2022

The Government Circuit: Ready to Tackle 2022

01-26-2022

As anticipated, it was a busy close to 2021 in Washington, and we saw resolutions on several major legislative priorities, including the annual defense authorization bill, which affects billions in future defense electronics spending. Meanwhile, negotiations on the U.S. Innovation and Competitiveness Act (USICA) remain on the back burner but could heat up in Q1. Read on for some of the recent highlights from 2021 and a look forward to 2022.

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2021

The Government Circuit: IPC is Looking Ahead to 2022

12-20-2021

As the new year beckons, IPC is ready to finish 2021 on a high note. The “big” news around IPC was the recent release of our comprehensive report on the advanced packaging ecosystem in North America. One of the report’s major takeaways is that North America now finds itself in a worrisome predicament: it can design the most cutting-edge electronics but cannot manufacture them. We hope you take the time to check it out, share it with your networks, and stay tuned for more “industry intelligence” reports coming your way.

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The Government Circuit: How Can Government Help or Hurt You in 2022?

10-26-2021

The seasons may be changing, but IPC’s commitment to advocating for the electronics manufacturing industry remains the same.

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The Government Circuit: A Summer Advocacy Update From IPC

09-01-2021

It’s been a busy summer here at IPC, with policy debates heating up across the globe. Here in Washington D.C., the U.S. Congress adjourned for its August “District Work Period,” but not before the U.S. Senate passed a major bipartisan infrastructure package, which we believe would positively affect our industry.

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The Government Circuit: IPC—Which Government Policies Worry You Most?

07-14-2021

As we begin the second half of the year, it provides us all with a good opportunity to take stock of our goals, hit the refresh button if necessary, and recommit to finishing the year strong. How are you feeling about the rest of 2021?

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The Government Circuit: Advocating for the Entire Electronics Supply Chain

06-16-2021

Here in Washington, we are encouraged by recent policy discussions that indicate a bipartisan commitment to U.S. manufacturing that is long overdue. European officials are also promoting a policy agenda that could be very positive for electronics. But there is still more work to be done to bolster the entire electronics ecosystem.

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The Government Circuit: Supply Chain Concerns Emerge as Global Issue

05-17-2021

IPC's Chris Mitchell shares updates on the new U.S. administration's focus on manufacturing, a holistic approach to supply chain management, recovery in Europe, the latest economic trends in the industry, and much more...

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The Government Circuit: Making Connections Between ‘Build Electronics Better,’ ‘Build Back Better’

03-17-2021

The new year has already spawned several positive government policy actions for the electronics industry, leaving us intrigued about the year to come. We're seeing an increase in policy debates that affect our industry, making IPC’s government relations (GR) work more critical than ever.

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The Government Circuit: IPC is Ready for the Year of Advocacy Ahead

01-19-2021

As anticipated, it was a busy close to 2020 in Washington, and we saw resolutions on several major legislative priorities, including coronavirus recovery, spending bills, and the National Defense Authorization Act (NDAA). IPC was able to secure some policy victories for the electronics manufacturing industry and keep our agenda moving forward into the new year. Read on for some of the recent highlights

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2020

The Government Circuit: Looking Ahead to 2021

12-15-2020

Before the 116th Congress adjourns for the holidays, IPC expects to secure some policy victories for the electronics manufacturing industry and keep its policy agenda moving forward. Read on—and watch this space—to learn how it all turns out.

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The Government Circuit: As 2021 Nears, What’s on IPC’s Government Policy Radar?

11-11-2020

In the United States, Election Day 2020 has come and gone, and all signs indicate that former Vice President Joe Biden is the presumptive President-elect. It’s shaping up to be a busy month here at IPC, heading into a busy new year. Chris Mitchell details some of the top issues we’re following this November.

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The Government Circuit: U.S. and European Lawmakers Eyeing Changes That Would Affect Our Industry

10-14-2020

The seasons may be changing, but IPC’s commitment to advocating for the electronics manufacturing industry remains constant as we look to position our industry for success in the coming year. Chris Mitchell shares some highlights of the top issues IPC is focused on this month.

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The Government Circuit: Green Regulations, the Economy, COVID-19, and ‘Decoupling’ in Focus for IPC This Fall

09-21-2020

Summer may be winding down, but autumn is shaping up to be a busy advocacy season for IPC. In this month’s column, Chris Mitchell provides an overview of the latest worldwide regulations you should be attuned to, the global economic landscape, and opportunities to make your voice heard with policymakers.

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The Government Circuit: Environmental, Health, and Safety Issues Are Hot in U.S., EU, and Asia

08-19-2020

Although coronavirus, trade wars, and supply chain concerns have dominated the discussion in our industry in recent months, many important environmental, health, and safety (EHS) issues are on the agenda as well. This column provides an overview of the EHS policy landscape and what IPC is doing to advocate for the electronics manufacturing industry.

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The Government Circuit: Renewed Focus on Worldwide Supply Chain Amid COVID-19

07-15-2020

One of the key takeaways from the coronavirus pandemic is that in times of crisis, sophisticated global supply chains can break down. Chris Mitchell explains how as the pandemic continues to play out, IPC is actively engaged in promoting global trade and the regionalization of supply chains.

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The Government Circuit: Coping With COVID-19 and Emerging Environmental Regs

06-10-2020

Across all regions where IPC has an advocacy presence, the policy debate is still dominated by the need to beat COVID-19 and climb out of the economic crisis. IPC's Chris Mitchell explains how governments are still working through their massive pandemic-recovery plans, and it is unclear whether national economies will snap back within months or take years to recover.

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The Government Circuit: Government Policy Moves Are More Important Than Ever During a Pandemic

05-06-2020

Isn’t it amazing how quickly and thoroughly the COVID-19 pandemic has changed the world? Chris Mitchell shares several of the top stories of recent weeks from an IPC government relations perspective, including issues that IPC is continuing to work on.

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The Government Circuit: An IPC Roadmap to Economic Recovery

03-26-2020

As the COVID-19 pandemic exacts a growing toll, public and private actors worldwide are marshaling resources to combat the spread of the virus and save the lives of those who are critically ill. In this unprecedented crisis, Chris Mitchell explains how IPC supports a sustained and bold policy agenda to help us all weather the economic downturn resulting from sweeping restrictions on business activity.

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The Government Circuit: IPC Marks Progress in Government Advocacy in 2019

01-14-2020

As we turn the calendar from 2019 to 2020, it is a natural time to take stock of the past year and look ahead to the year to come. Here are a few of the top stories of 2019 from Chris Mitchell's perspective as a government relations professional working to support the electronics manufacturing industry through public policy advocacy.

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2019

The Government Circuit: Europe Eyeing Changes in RoHS Environmental Regulations

12-02-2019

One of the world’s most comprehensive and restrictive environmental regulations is undergoing a comprehensive regulatory review, and IPC is actively involved in the process, coordinating industry views and advocating on behalf of the electronics manufacturing industry. Chris Mitchell gives an update on activities related to the European Commission’s Restriction of Hazardous Substances Directive (RoHS) Directive.

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The Government Circuit: U.S.-China Tariff War Threatens American Jobs and Investments

11-06-2019

Fifty-five percent of companies report they are facing higher costs as a result of higher tariffs, which are affecting, on average, about one-third of the total dollar value of the products they import. Some companies say their costs have increased more than the direct costs of the tariffs due to higher administrative and operational burdens to sort it all out.

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The Government Circuit: Recession Fears, Trade Wars: What Can We Do?

09-04-2019

Despite many strong economic indicators, recent news reports are filled with growing concerns about the risk of a U.S. and global recession in the next 12–24 months. Amid a prolonged trade war between the U.S. and China, and an "inversion" between long-term and short-term bond yields, a recent survey found that 74% of economists predict the next recession will hit by the end of 2021.

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The Government Circuit: Trump Praises Industry on Workforce Issues, IPC Launches Grassroots Platform

08-07-2019

July was a fun, productive month for IPC on the government relations front. Most notably, IPC’s workforce development efforts were recognized at the White House in Washington and on a factory floor in Michigan. On another front, we've launched an online platform that makes it easier for our members to contact their elected officials, and we’re using it to seek more R&D funding for an important industry project.

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The Government Circuit: IPC Promoting R&D on Lead-free Electronics, Streamlined Chemical Data Reporting, and More

07-04-2019

For the most part, working in government relations is like running a marathon, not a sprint. It can take weeks, months, or even years to formulate an industry consensus position, educate the relevant policymakers in legislatures and executive branch agencies, build alliances and broad support, and ultimately push a final action over the finish line. That metaphor was certainly fitting in recent weeks as IPC scored two interim wins on issues we’ve been working on for years.

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The Government Circuit: Team IPC Working on North American Trade, EPA Regulations, EU Policy, and More

06-13-2019

In one of the highlights of IPC’s work every year, top executives from electronics companies from across the U.S. came together in Washington, D.C., recently to call for policies that will drive the electronics industry’s success. Attendees met with leading policymakers to discuss the U.S.-Mexico-Canada Agreement (USMCA), the electronics supply chain, EPA regulations, and workforce education.

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IPC’s D.C. Focus: Chemicals Regulations, Lead-Free, Export Controls

05-07-2019

From North America to Europe, Asia, and beyond, the future of the electronics manufacturing industry is shaped in many ways by government policies. That’s why IPC maintains an active, multifaceted government relations program, including leadership and networking opportunities for member company executives.

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U.S. Tax Law Boosts Growth, But Uncertainties Loom

04-17-2019

Monday, April 15 was the deadline for millions of Americans to file their income tax returns, so this is a good time to review the Tax Cuts and Jobs Act of 2017 (TCJA) as well as the current tax policy landscape and how these rules are affecting the electronics industry.

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