The AFL-CIO, the largest U.S. labor organization, said Monday it strongly supports a U.S. House of Representatives bill designed to improve competition with China and boost U.S. semiconductor production.

The trade federation, representing 12.5 million workers, said in a letter to lawmakers the bill's $52 billion for chips is critical to "addressing the current chip shortage that continues to adversely impact production in the automotive sector and elsewhere."

The U.S. House plans to take up the bill later this week.