<figure><figcaption> President Joe Biden speaks in Syracuse in April on the $6.1 billion grant that Micron will receive to build a chip megafab in the Town of Clay(Darren McGee / Office of the Governor )</figcaption></figure>

Last month, a number of political dignitaries, including President Joe Biden, Senate Majority Leader Chuck Schumer, and Gov. Kathy Hochul, descended upon Syracuse to tout the massive $6.1 billion grant for Micron from the CHIPS and Science Act for its massive megafab project in the Town of Clay. This week, Grant Reeher talks about the labor and economic impacts of the project with Syracuse University Professor Tod Rutherford.

Program transcript:

Grant Reeher: Welcome to the Campbell Conversations. I'm Grant Reeher. Last month, a host of political dignitaries, including President Biden, Governor Hochul and Senator Schumer, descended upon Syracuse to tout the federal government's $6.1 billion in grants through the Chips Act to Micron, which plans to build a microchip mega complex in Clay and has said it will invest $100 billion in the project. There was, needless to say, a lot of celebration on that day. My guest today is an economic and labor geographer who's been looking at the Micron project. Tod Rutherford is a professor of geography and the environment at Syracuse University's Maxwell School of Citizenship. Professor Rutherford, welcome to the program.

Tod Rutherford: Thank you very much, Grant. Thanks for having me on.

GR: Well, we're glad you could make it. So, as I just mentioned, you know, there are a variety of government incentives for this Micron project and $6 billion from the Federal Chips Act most recently. But there have been other, goodies and incentives that state and local governments have been putting in as well. Could you just briefly summarize some of those?

TR: Yeah, I mean, the Chips Science Act is $280 billion in total, with $39 billion allocated to, supporting domestic manufacturing. and another $13 billion for research and development and workforce development. But this is, of course, been accompanied by a host of other, kinds of, subsidies and, tax abatements and so forth like this. So, I know that the county, Onondaga County has put in a fairly significant, level as well as New York state. I don't quite have the figures to hand, but, it's a significant amount of money on top of that. Yes.

GR: I think it was in, you know, like almost $300 million by the time it got added up..

TR: Yeah over a 20 year period. Yeah.

GR: Okay, that’s important to note, right? It's not all up front. So, thinking about that and also thinking about the promise of Micron, what people are hoping to see out of it. in one way, I guess I could say we've seen this movie before in this region, and there's even a pun in that sentence, in terms of Syracuse's history on this. But it is nonetheless the case when I talk to people around the town about Micron, a lot of them are very excited. But there are others that say, you know, they'll believe it when they see it, and, so they're a little suspicious of it. Do you think that that it's different this time around with Micron when it comes to helping the area economically?

TR: Well, I think, you know, some degree of healthy skepticism is a good thing to have with respect to this, as you say, there is a history. I don't think, though, we've ever had this kind of level of federal and state commitment, through the Chips Act, through the other kinds of, interventions that are being made. So that would, what I would call wouldn't it doesn't eliminate the possibilities that there are risks with this. Nothing will, but it would seem to me that this would, help the project meet, at least some of its at least minimal goals, if not more. Yes.

GR: Yeah. This is kind of a more political question for you, but at least one of the things that seems different to me anyway is I get the sense that that there are some pretty prominent political players that have put a lot on the line here. I mean, you know, I mentioned Governor Hochul, Schumer, President Biden. So that that to me feels a little different than maybe some of the other economic development projects, you know, if you would.

TR: Yeah. And I think that, you know, post-Covid, there's been a really strong sense in which the kind of globalization model that had been adopted from, like the late 1970s onwards was clearly, problematic in terms of the level of resiliency, dependency on complex overseas, supply chains, all of which were, you know, on, just in time systems. So there was no kind of room for error in them. And we found that, you know, in trying to recover from Covid in the economic sense that, these were really, deeply problematic. And so there has been, I think, both an economic and political argument for reshoring on top of this longer-term concern about the level of investments that's required to sustain a viable manufacturing base in the United States.

GR: Yeah. So the country itself has a stake in this project, I guess, as opposed to, say, the film hub or the mall. So, I was wondering, in addition to the confidence level in the project, actually happening, which is what you've just been speaking to a little bit from an economic standpoint and a governmental tax standpoint, are there reasons to think that that will see the government and therefore, you know, we the people of Onondaga County, I guess we'll get our money back from these upfront investments?

TR: Yeah. I mean, assume let's assume that the number of jobs direct jobs that are, said to be created over this next 20-year period are created. So there's something that we, economic geographers talk about, multiplier effects. and that is, for every direct dollar spent in a sector, how many other, indirect, spendings and jobs can be linked to it. And manufacturing tends to have a fairly high level of multipliers. like, you know, the auto industry in particular, but also, chip manufacturing. So, if we say that we're going to get 9,000 direct jobs as, as is, the forecast in this project with Micron, then we're looking up to, an additional 40,000 more jobs being created. And so, if we're anywhere near that figure, then, then it will pay back just in terms of, the multiple ways of spending, tax revenue and so forth. Yes.

GR: Yeah. Those number of those jobs is really mind-boggling when you think of the size of Syracuse.

TR: Yeah, so assuming that we get anywhere near those jobs, that's that's the big thing. Yeah.

GR: You're listening to the Campbell Conversations on WRVO Public Media. I'm Grant Reeher and I'm speaking with Syracuse University geography professor Tod Rutherford, and we're discussing the Micron project in central New York. So based on your research, Tod, and the things that you've looked at and thought about, what are your biggest concerns about the economic aspects of this project as you look at it right now?

TR: Well, when we have to remember that this is a very cyclical industry. and so it's it's very difficult to forecast in any one year or even a five-year period, you know, exactly if jobs will be created or if jobs that are created don't simply result in layoffs. So we need to be prepared for thinking about the cyclical nature of the industry, even one that's getting the level of subsidy that it that it's getting. The other thing that I'm somewhat concerned about on the kind of economic front is, you know, who's going to be responsible for training, and, and doing those kinds of things, because it seems to me that the model that the United States has followed for about the last 50 years is increasingly, employers expect, either the public sector through the education or some other body to do the training and so it seems to me that there is this expectation and this is certainly happening in the local economy where, you know, Onondaga College and Syracuse University are stepping up the amount of investment and I'm not necessarily against that. But we do have to ask, you know, whose responsibility is it to make somebody's job ready? Where does the the public sectors, responsibility and the employer's responsibility, begin? And it seems like, for a long time, the kinds of training that used to be done internally, are, are now expected to be done either by the individual coming into the job or, through the public education system. And so if, if Micron and other companies are gaining this level of subsidy, is it not fair to expect that they should also pick up more of the training? And that's not clear to me that that's going.

GR: Yeah, that's an interesting point. And and I wanted to ask you about that, that what I mean, what happens if okay, OCC and SU and you know, maybe LeMoyne and other schools around here create programs, and then Micron says after they encounter these people, well, they're really not quite what we need. We're going to have to hire overseas or we're going to have to pull people over from, Idaho or something. I mean, is that what happens then is that is that just the company's decision or?

TR: Well, I mean, and again, we're not sure, exactly what the agreement says about those aspects, assuming that it's just simply the company's decision to make, then, yes, they could brin