The U.S. economy is increasingly reliant on artificial intelligence spending, with significant investment in data centres and related infrastructure fuelling GDP growth. Major tech companies like Amazon, Microsoft, Alphabet, and Meta are projected to invest heavily, reaching $344 billion this year and potentially $404 billion in the next. This surge in AI-related capital expenditure is reshaping economic indicators, contributing significantly to GDP growth even as labour market gains slow.
Rising AI stock prices have also boosted household wealth, further stimulating consumer spending. However, this dependence on AI investment poses risks, as a reversal in AI spending or stock values could trigger a broader economic downturn. Economists suggest that without the AI boom, the U.S. economy might already be in a recession. While AI investment is driving growth, other areas like commercial construction remain weak, highlighting the concentration of investment in the AI sector.
Despite the massive spending, the long-term impact of AI on worker productivity remains uncertain. The current focus is on capital-intensive assets like servers and data centres, rather than labour-intensive industries. For AI to significantly boost overall U.S. growth, analysts estimate that approximately $1 trillion in AI-related spending would be required.
