6 ms·

Look at it from the local government prospective, they could get 0 in tax income or they can settle from the tax income of thousands of new high income jobs.

didibus 6y ago
Do gigafab manufactures like that really create high income jobs? I assumed it was mostly low income close to minimum wage kind of thing. On a similar tangeant, how are these able to compete with similar manufacturing done in Asia or Africa?
- valvar 6y ago
  I don't know anything about how they are run, but I would assume you need a large number of on-site engineers and process overseers. What are the low-income jobs? Security?
  - didibus 6y ago
    I thought it was mostly assembly line workers putting parts together, with machines doing the rest. Kinda like what this photo shows: https://bit.ly/3a8uRFM https://bit.ly/3a8uRFM
    - sgerenser 6y ago
      That’s board assembly, not chip fabrication.
    - f430 6y ago
      So you admit you were ignorant. That's a rarity on here. People will defend their wrong views here because they don't want to hear they aren't a polymath.
    - adriancr 6y ago
      This is how it looks like now: https://www.extremetech.com/wp-content/uploads/2018/12/TSMC-Semiconductor.jpg https://www.extremetech.com/wp-content/uploads/2018/12/TSMC-... Machines feed each other via conveyor belts, everything automated, tight control loops check/move things around. Notice the difference in human presence.
- barbacoa 6y ago
  Average salary is probably around $100k. Even the techs with high school educations can make in the range of $40-60 an hour and generous overtime. >On a similar tangeant, how are these able to compete with similar manufacturing done in Asia or Africa? Because it is all high skill labor. Techs that are able to strip down a 10 MM machine and identify the source of sub micron particule contamination are worth their weight in gold.
  - pwdisswordfish0 6y ago
    They may be costing the company the equivalent of $40–60/hr, but more realistically, techs are starting at < $20/hr and have to spend years on the payroll of a third-party staffing company.
    - barbacoa 6y ago
      That's a good point, $40-60/hr is the pay for seniors level techs. Entry level techs are making much less and are employed through staffing companies.
  - mech422 6y ago
    >>Average salary is probably around $100k. Even the techs with high school educations can make in the range of $40-60 an hour and generous overtime. Do you have a source for that? I'm surprised as when I contracted at the Intel fab in PHX, the workers in the actual fab were not making anything close to that. Management maybe, but not actual line workers. The standing joke was "they were working for the stock"...
    - JohnJamesRambo 6y ago
      Were they working for the stock?
    - didibus 6y ago
      I found this which has a manufacturing plant section. No idea how accurate: https://www.zippia.com/intel-careers-6055/salary/#by-job-title https://www.zippia.com/intel-careers-6055/salary/#by-job-tit...
TedDoesntTalk 6y ago
> or they can settle from the tax income of thousands of new high income jobs. There is no income tax in Texas. Even if there was, it would go to the state, not the county or city.
- chrisrogers 6y ago
  Property and sales taxes, then.
  - zymhan 6y ago
    Dude, the whole thread started with a comment about Samsung trying to pay no property taxes.
    - sida 6y ago
      OP means Property tax from employees. Because it creates a ton of jobs
      - mywittyname 6y ago
        There are plenty of businesses that create tons of jobs and pay their taxes. Tax deductions aren't meaningful for most companies. Samsung is pretty limited on where they can actually build this plant. It's not like Hattiesburg, Mississippi is awash with people experienced in silicon fabrication. So the company would have to pay a lot of money to import people from other regions. But Hattiesburg isn't exactly top on the list of places where experienced technical professionals wish to live. The city counsel should play hardball with Samsung, since they will cave. This is one of those situations where it doesn't hurt to ask, but the decision is already made.
      - zymhan 6y ago
        But what says those people will live within Austin city limits (ba dum tiss) and pay property taxes to the government that gave out the tax break? Surely a sizeable number would commute? Also, collecting new property taxes from a corporation would allow the city to keep rates lower for residents.
rizpanjwani 6y ago
texas doesn't have income tax.
imtringued 6y ago
The local government can lose money on this deal even if it leads to more jobs.
specialist 6y ago
Someone has to build the roads, run the schools, pump the water, etc. A tax cut for Samsung is effectively a tax hike for everyone else.
- arcanus 6y ago
  > A tax cut for Samsung is effectively a tax hike for everyone else. That is a remarkably zero sum way to think about it.
  - f430 6y ago
    zero sum implies everyone loses in the long run. Samsung benefits. Texas state benefits. Workers benefit. Community benefits.
    - specialist 6y ago
      Please enumerate all the ways the community benefits. Be mindful to include externalities in your ledger.
      - mywittyname 6y ago
        These business can act as anchors to attract skilled talent to the region. If that happens, then a small no-name town can really prosper. But the reality is that companies don't really want to be the ones anchoring a small town. The sacrifice is too great in terms of limited talent pool, and lack of amenities necessary to attract talented people. Maybe after 20 years, the town grows into something significant, but at that point, the market has shifted so much that it probably doesn't matter. In this situation, the decision is made, regardless of tax incentives. Samsung can't just plop one of these plants anywhere. The plant needs to be in a place that has a large enough pool of talent, the amenities (schools, restaurants, housing, etc) that attract new talent (ideally without Samsung having to pay for relocation), and have the logistics infrastructure to support business. I've seen plenty of large companies negotiate for aggressive tax breaks locally, only to up and move to places like NYC, LA, or another high-tax locale a few years later because they either can't attract talent, or senior executives don't like living in cheap midwestern cities.

didibus 6y ago

Do gigafab manufactures like that really create high income jobs? I assumed it was mostly low income close to minimum wage kind of thing. On a similar tangeant, how are these able to compete with similar manufacturing done in Asia or Africa?

valvar 6y ago
I don't know anything about how they are run, but I would assume you need a large number of on-site engineers and process overseers. What are the low-income jobs? Security?
- didibus 6y ago
  I thought it was mostly assembly line workers putting parts together, with machines doing the rest. Kinda like what this photo shows: https://bit.ly/3a8uRFM https://bit.ly/3a8uRFM
  - sgerenser 6y ago
    That’s board assembly, not chip fabrication.
  - f430 6y ago
    So you admit you were ignorant. That's a rarity on here. People will defend their wrong views here because they don't want to hear they aren't a polymath.
  - adriancr 6y ago
    This is how it looks like now: https://www.extremetech.com/wp-content/uploads/2018/12/TSMC-Semiconductor.jpg https://www.extremetech.com/wp-content/uploads/2018/12/TSMC-... Machines feed each other via conveyor belts, everything automated, tight control loops check/move things around. Notice the difference in human presence.
barbacoa 6y ago
Average salary is probably around $100k. Even the techs with high school educations can make in the range of $40-60 an hour and generous overtime. >On a similar tangeant, how are these able to compete with similar manufacturing done in Asia or Africa? Because it is all high skill labor. Techs that are able to strip down a 10 MM machine and identify the source of sub micron particule contamination are worth their weight in gold.
- pwdisswordfish0 6y ago
  They may be costing the company the equivalent of $40–60/hr, but more realistically, techs are starting at < $20/hr and have to spend years on the payroll of a third-party staffing company.
  - barbacoa 6y ago
    That's a good point, $40-60/hr is the pay for seniors level techs. Entry level techs are making much less and are employed through staffing companies.
- mech422 6y ago
  >>Average salary is probably around $100k. Even the techs with high school educations can make in the range of $40-60 an hour and generous overtime. Do you have a source for that? I'm surprised as when I contracted at the Intel fab in PHX, the workers in the actual fab were not making anything close to that. Management maybe, but not actual line workers. The standing joke was "they were working for the stock"...
  - JohnJamesRambo 6y ago
    Were they working for the stock?
  - didibus 6y ago
    I found this which has a manufacturing plant section. No idea how accurate: https://www.zippia.com/intel-careers-6055/salary/#by-job-title https://www.zippia.com/intel-careers-6055/salary/#by-job-tit...

TedDoesntTalk 6y ago

> or they can settle from the tax income of thousands of new high income jobs. There is no income tax in Texas. Even if there was, it would go to the state, not the county or city.

chrisrogers 6y ago
Property and sales taxes, then.
- zymhan 6y ago
  Dude, the whole thread started with a comment about Samsung trying to pay no property taxes.
  - sida 6y ago
    OP means Property tax from employees. Because it creates a ton of jobs
    - mywittyname 6y ago
      There are plenty of businesses that create tons of jobs and pay their taxes. Tax deductions aren't meaningful for most companies. Samsung is pretty limited on where they can actually build this plant. It's not like Hattiesburg, Mississippi is awash with people experienced in silicon fabrication. So the company would have to pay a lot of money to import people from other regions. But Hattiesburg isn't exactly top on the list of places where experienced technical professionals wish to live. The city counsel should play hardball with Samsung, since they will cave. This is one of those situations where it doesn't hurt to ask, but the decision is already made.
    - zymhan 6y ago
      But what says those people will live within Austin city limits (ba dum tiss) and pay property taxes to the government that gave out the tax break? Surely a sizeable number would commute? Also, collecting new property taxes from a corporation would allow the city to keep rates lower for residents.

rizpanjwani 6y ago

texas doesn't have income tax.

imtringued 6y ago

The local government can lose money on this deal even if it leads to more jobs.

specialist 6y ago

Someone has to build the roads, run the schools, pump the water, etc. A tax cut for Samsung is effectively a tax hike for everyone else.

arcanus 6y ago
> A tax cut for Samsung is effectively a tax hike for everyone else. That is a remarkably zero sum way to think about it.
- f430 6y ago
  zero sum implies everyone loses in the long run. Samsung benefits. Texas state benefits. Workers benefit. Community benefits.
  - specialist 6y ago
    Please enumerate all the ways the community benefits. Be mindful to include externalities in your ledger.
    - mywittyname 6y ago
      These business can act as anchors to attract skilled talent to the region. If that happens, then a small no-name town can really prosper. But the reality is that companies don't really want to be the ones anchoring a small town. The sacrifice is too great in terms of limited talent pool, and lack of amenities necessary to attract talented people. Maybe after 20 years, the town grows into something significant, but at that point, the market has shifted so much that it probably doesn't matter. In this situation, the decision is made, regardless of tax incentives. Samsung can't just plop one of these plants anywhere. The plant needs to be in a place that has a large enough pool of talent, the amenities (schools, restaurants, housing, etc) that attract new talent (ideally without Samsung having to pay for relocation), and have the logistics infrastructure to support business. I've seen plenty of large companies negotiate for aggressive tax breaks locally, only to up and move to places like NYC, LA, or another high-tax locale a few years later because they either can't attract talent, or senior executives don't like living in cheap midwestern cities.