If you pay close attention to our Weekly Economic Update, you may have noticed that we have been closely monitoring the economic implications of the war in Iran. The closure of the Strait of Hormuz and disruptions to global energy supply chains are having outsized impacts on Asia, which includes important U.S. trading partners that import most of their energy from the Middle East.
One of the most important trading partners for the United States is Taiwan, which is a manufacturing powerhouse for highly advanced microprocessors and integrated circuits, technologies integral to the AI and data center booms that have been helping drive the U.S. economy in recent years. As of January 2026, 94% of graphics processing units (GPU) imports and a significant proportion of Central Processing Unit (CPU) and Random Access Memory (RAM) imports come from Taiwan,[1] making it an important piece of the technology supply chain.
With energy and helium shortages looming over Taiwan, it is important to identify what regions in the U.S. will be at risk, directly or indirectly, from rising input costs and energy shortages with this important trading partner.
The map below shows the gross value of integrated circuit imports from Taiwan for each state in 2025 and the concentration of employees in industries related to the manufacturing and use of advanced integrated circuits by state.[2] These industries include semiconductor manufacturing, research and development, and data center operations.. Unsurprisingly, the states with high concentrations of data center, R&D, and AI-related employment have the most imports of integrated circuits from Taiwan.
New Mexico imported over $3 billion worth of integrated circuits from Taiwan, which included 78% of the state’s imports of the highly advanced CPUs and GPUs necessary for modern computing. Unsurprisingly, New Mexico has a high concentration of AI, R&D, and data center-related employment due both to Intel’s manufacturing activity and the research conducted at Sandia National Laboratory. Over 45,000 workers in New Mexico are employed by AI, R&D, and data center-related industries, a significant sum for a state with a workforce less than a million.
California and Oregon both imported over $2 billion worth of integrated circuits from Taiwan in 2025. California’s role in the tech industry is well documented, with Silicon Valley driving AI and other high-tech uses of integrated circuits. In the San Jose-Sunnyvale-Santa Clara MSA, over 16% of the workforces is employed in AI, R&D, and data center-related industries. In the San Francisco-Oakland-Fremont MSA, these industries account for 9.4% of the workforce. Oregon has a growing semiconductor industry dubbed the “Silicon Forest.” Over 76,000 workers in Oregon are employed in AI, R&D, and data-center related industries, including over 25,000 in semiconductor manufacturing.
As the conflict in Iran continues and supply chain disruptions impacting our close trading partners worsen, we will continue to keep a close eye on labor market developments in the high-growth, high-wage sectors that have been driving the economy.
[1] https://usatrade.census.gov/
[2] For industry concentrations, Chmura uses the location quotient (LQ). LQs higher than 1.00 indicate a higher concentration of the industry in a state compared to the nation overall.
By Colin Emberland
