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?
If you’re like most IPC member company executives, you may be optimistic about the economic recovery but concerned about current political debates and how they might affect your company. Our government relations (GR) team is working hard to educate policymakers and advocate for our industry, and I can tell you this: The more our IPC members are involved in our work, the greater the impact we have and the more successful we are.
Check out our recent blog regarding the strategies and tactics we utilize to impact government policy, as well as the key issues we’re working on today, and how you can be involved in advocating for our industry.
Read on below for some of the highlights of our work around the world over the past month.
IPC Advocates for the Entire Electronics Supply Chain
In Washington, D.C., the new administration of President Joe Biden is pursuing several initiatives that may create opportunities to revitalize U.S. electronics manufacturing.
Most recently, the Biden administration concluded its 100-day supply chain review in early June, and IPC was pleased to see it address the importance of the electronics supply chain.
The results of the 100-day review were covered in an 11-page White House fact sheet and a 250-page report, and among its major recommendations were steps to strengthen U.S. semiconductor manufacturing and ensure the availability of minerals critical to electronics manufacturing. We also identified multiple passages that reflect IPC’s input and the need to bolster the entire electronics supply chain, even if it was not the primary focus of the report. As a follow-up, representatives of IPC, Calumet Electronics, Jabil, and TTM met on June 16 with U.S. Commerce Department officials to further educate them on these issues; we are encouraged that the administration is committed to further dialogue and policy action.
In case you missed it, I recently discussed the Biden administration’s efforts to bolster the U.S. electronics supply chain in a recent interview with SupplyChainDive. In short, I said the time is now for the United States make a broad-based commitment to electronics manufacturing.
IPC’s GR team is also actively engaging on legislation to bolster U.S. technology leadership and competitiveness. The U.S. House of Representatives passed two bipartisan bills in June centered on countering China’s influence by bolstering U.S. science and technology research. The National Science Foundation (NSF) for the Future Act and the Department of Energy Science for the Future Act together will invest $128 billion into the NSF and U.S. Department of Energy's Office of Science.
Also in June, the U.S. Senate approved its own tech and competitiveness legislation, the U.S. Innovation and Competition Act, which includes the Endless Frontier Act. Unfortunately, as of this writing, these bills do not specify electronics manufacturing as an area for increased investment, but we are asking lawmakers to include more explicit support for the sector.
IPC’s Latest Economic Trends Report
Meanwhile, the global economic recovery from COVID-19 is accelerating as vaccination rates increase and countries fully open their economies. The global economy is expected to expand 6.1% in 2021 and a further 4% in 2022, according to IPC Chief Economist Shawn DuBravac.
The growth outlook is driven in part by the upward trend in vaccination rates and the downward trajectory of COVID. In Europe, in the first quarter, the economy shrank less than previously expected, and the growth outlook is improving. However, outsized risks remain. The highly contagious delta variant is spreading and has the potential to throttle recovery efforts. Of greatest concern, the COVID variants are likely to spread in emerging nations before they can achieve widespread vaccination, suggesting that growth rates could diverge between emerging markets and developed economies.
Be sure to check out IPC’s most recent Monthly Economic Outlook Report, including new data on U.S. and European economic growth; employment, consumer and manufacturers’ sentiment; manufacturing capacity utilization; and end markets for electronics.
Having an Impact: DoD’s CMMC Review to Address Compliance Cost Concerns
As IPC has urged, compliance costs for small and medium-sized enterprises (SMEs) will be a focal point of the U.S. Defense Department's (DoD) Cybersecurity Maturity Model Certification (CMMC) review, Federal News Network reported. IPC recently made the case in an industry report and provided input to a congressional hearing that CMMC compliance costs could drive many SMEs, including IPC members, out of the defense industrial base.
In fact, fewer than half of IPC survey respondents felt they were “very” or “extremely” familiar with CMMC compliance, and 52% said that the DoD has not provided industry with sufficient guidance. Our report also demonstrates that DoD has underestimated the compliance costs. Read a recent statement on the issue from IPC President and CEO John Mitchell.
Environmental Regulators Remain Busy in the United States
As things stand now, it’s primed to be a busy summer at the U.S. Environmental Protection Agency (EPA).
According to a recently released Office and Management and Budget (OMB) regulatory agenda, the EPA plans to publish its interim final rule on persistent, bioaccumulative, and toxic (PBT) chemicals this September. This move follows the EPA’s final risk-management rules for phenol, isopropylated, phosphate (3:1) (PIP (3:1)), one of the five PBT chemicals, which IPC and other industry groups submitted comments on. IPC will continue to work with the EPA and advocate for realistic risk management strategies.
Meanwhile, on June 10, the EPA announced the pre-publication of a proposed rule requiring all manufacturers and importers of per- and polyfluoroalkyl substances (PFAS) to report information about goods containing the chemical substance. PFAS has a history of use in electronics, and IPC plans to engage with the electronics industry to review the proposed rule and provide comments during the expected 60-day comment period.
And closing out what was a busy month, the EPA announced on June 30 that it will be reviewing the first 10 risk evaluations of certain chemical substances to ensure all populations are protected from unreasonable risks associated with these substances, several of which are used to manufacture electronics. IPC will continue to monitor the EPA’s progress in this review and any subsequent risk management actions.
Stay tuned to our weekly newsletter for more ways to get engaged in our environment and health advocacy efforts.
OSHA Releases Emergency Standard on COVID-19
On June 10, the U.S. Occupational Safety and Health Administration (OSHA) released regulatory language for the long-awaited Emergency Temporary Standard (ETS) for COVID-19. The rule will only apply to the healthcare industry and will not apply to manufacturing. In addition to the ETS, OSHA updated its guidance on preventing COVID in the workplace to provide recommendations on protecting unvaccinated workers. Your team should check this out, but the updated guidance is not a standard or regulation and creates no new legal obligations.
Interested in Chemical and Product Regulations in Asia and Europe?
Environmental regulatory developments are also continuing in the Asia-Pacific region and in Europe.
On May 26, experts from IPC and Mayer Brown presented at a Chemical Watch webinar on the latest updates to China’s Ministry of Environment and Ecology (MEE) Order 12 regulation, its legal implications, and the potential impacts on the electronics industry. Heng Li, an attorney with Mayer Brown, indicated that we should expect to see more chemical legislation in China “in the near future.” Read IPC’s full recap of the webinar on our website. And be sure to check out IPC’s nine white papers on the history of chemical regulations, current regulatory systems, and upcoming trends in the Asia-Pacific region for more.
Meanwhile, IPC submitted comments to the European Commission’s public consultation on its Sustainable Products Initiative, a key component of the European Union’s Circular Economy Action Plan. We believe that any sustainable product legislation should focus on final electronics products with the greatest environmental impacts and the greatest potential for circularity improvements. The initiative will revise and expand the Ecodesign Directive and will address the presence of harmful chemicals in electronics and ICT equipment, among other products. Read IPC’s full comments on our website; then plan to join IPC and the International Electronics Manufacturing Initiative (iNEMI) for our final joint webinar on eco-design for a circular electronics economy. Register for the webinar here.
Help IPC’s Advocacy Team Help You!
Finally, to our U.S. IPC members: please take a minute to visit our online action center and register to participate in upcoming campaigns to educate the U.S. Congress on our key issues. It’s fast, easy, and important.
We welcome your questions and suggestions about our industry advocacy efforts and, most of all, we welcome your participation. Experience proves that the more our members are involved, the greater impact we have, and the greater success we all enjoy.
Will you join us?
- IPC Monthly Economic Report, June 2021, ipc.org.
- Pentagon CMMC review aims to address small biz cost concerns, ‘restore trust’ in assessment processes, Federal News Network, June 24, 2021.
Chris Mitchell is IPC’s VP of global government affairs. Contact him at ChrisMitchell@ipc.org.