Automation and AI Stocks to Thrive from Biden's Manufacturing Push

Deloitte's research points to a significant skill gap in the manufacturing industry, which has been a stumbling block for growth. With a shortage of qualified workers plaguing the sector, companies are struggling to hire and retain employees capable of fulfilling modern manufacturing needs. This issue was underlined by a survey from the National Association of Manufacturers, which highlighted that attracting a skilled workforce is a critical challenge for the majority of manufacturing executives.

The Rise of Smart Factories

In anticipation of future trends, 83% of manufacturers believe that intelligent automation will radically change product production processes within five years. The influence of the Biden administration's efforts to strengthen American manufacturing, alongside tariff implementations, positions the automation industry favorably, enabling them to leverage cost-cutting technologies to maintain competitive edges.

Integral to automation are advancements within artificial intelligence (AI) and robotics, which are increasingly being adopted across various sectors. Prominent tech companies engaging in these technologies include NVIDIA Corp (NVDA), Qualcomm Inc (QCOM), Microsoft Corp (MSFT), and Alphabet Inc (GOOG).

Automation Stocks in the Spotlight

Rockwell Automation Inc (ROK), a well-established company specializing in industrial production automation tools, has seen mixed market reactions recently. Meanwhile, Teradyne Inc. (TER), which automates testing equipment, has witnessed its stock price surge and received an upgraded rating to 'Buy' by Goldman Sachs.

Amkor Technology Inc. (AMKR) is investing heavily in semiconductor packaging and testing, with a $2 billion plan for a new facility in Arizona. Investors are also paying close attention to ETFs like the Global X Robotics and Artificial Intelligence ETF (BOTZ) and the Global X Artificial Intelligence & Technology ETF (AIQ), which, along with the iShares Robotics and Artificial Intel Multisector ETF (IRBO), offer exposure to the thriving AI and automation markets.

Legislation and Investments

The U.S. is undergoing a strategic realignment of its key industries, such as semiconductors, electric vehicles, and green energy, by bringing production facilities back home. The Biden administration's infrastructure and investment acts, including the Infrastructure Investment and Jobs Act, and the CHIPS Act, have allocated billions toward renovating infrastructure and reclaiming semiconductor production leadership—all of which may boost the companies at the forefront of automation and AI technologies.

automation, manufacturing, semiconductor