Despite the challenges of the past 15 months, Phoenix’s economy is booming. In 2019, Arizona was ranked 2nd in the nation in job growth. As of this Spring, Arizona is the 9th fastest state in job recovery. Arizona is also the 2nd fastest growing state by population with a personal income growth rate of 8.4%.
The Valley continues to see significant growth across multiple industries, especially in advanced manufacturing and IT. There are several recent relocation and expansion plans that are taking place in Phoenix, such as Intel, Taiwan Semiconductor Manufacturing Co. (TSMC), Electra Mecchanica, and APEL Extrusions. CompTia recently released their CyberStates 2021 report which predicts significant growth in the tech sector in Phoenix in 2021, and a 2nd place ranking in the diversity index.
Arizona’s largest-ever direct foreign investment, Taiwan Semiconductor Manufacturing Co. (TSMC)’s $35 billion production facility, plans to break ground in 2021 in north Phoenix. An investment of this magnitude demonstrates a long-term commitment to doing business in Arizona. What initially started as a $15 billion investment has already more than doubled.
I recently met with Peter Cleveland, Global Policy VP of TSMC, about the company’s impact and integration into the Phoenix community. Peter shared that TSMC will contribute around $2.9 billion into the Phoenix economy. The job impact is also impressive with a plan to hire 2,000 new engineers and transfer 2,500 supplier-based workers to the area. Arizona has quickly rebounded from the pandemic and is leading the nation in job recovery. Yet, there are still too many people that are either unemployed or underemployed. Accessibility to high-wage careers like those offered at TSMC will continue to drive growth for our economy.
The announcement of TSMC alone has a significant economic impact, but the dynamic effects of this investment are much greater. This announcement put Arizona at the forefront of international media as a business-friendly environment with a diverse talent pool. This international attention led to Arizona being on Samsung’s short list for their $17 billion chip plan. With increased foreign investment, airlines are much more likely to consider new international flights from Phoenix, such as a direct flight to Asia. Multiple foreign and domestic suppliers have already announced plans to expand into the Phoenix market, creating a much larger hub for semiconductor manufacturing in the state. These suppliers will require business services like accounting, legal, and consulting. The increased employment base will also drive up housing demand and many other sectors of the economy such as health care, retail, and hospitality. TSMC’s investment will also lead to additional investments in education and training programs, creating a talent pipeline for current and future employers. This leads to additional relocations and expansions such as Intel’s recent expansion announcement.
As Phoenix’s economy continues to thrive and rebound, I encourage you to stay informed by attending our next Economic Development Insider Series on August 19th. At this program, you will hear from a panel of executives from various manufacturing sectors as they discuss the trends within the industry, and how to meet increased talent pipeline demands and rethink developing future workforce needs. The Chamber remains committed to n ensuring that you have the tools, and resources you need to compete and grow your business in today’s fast paced economic environment .