Jason Furman Says US GDP Would Be Flat Without AI Investment
Furman shared his findings in a post on social media platform X (formerly Twitter), revealing that if investment in data centers and related technology were excluded, US GDP growth would have been just 0.1% on an annualized basis, as per a Fortune report.
His findings were supported by financial analysts, including Robert Armstrong of the Financial Times’ Unhedged, who have noted the sharp rise in data center construction. In August, Renaissance Macro Research estimated that the contribution of AI data center buildouts to GDP growth in 2025 had, for the first time, surpassed US consumer spending, which usually makes up two-thirds of GDP, as per the report.
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Data Center Investments Account for 92% of US GDP Expansion in 2025
Furman pointed out that investment in information-processing equipment and software made up only 4% of total US GDP in the first half of 2025 but accounted for 92% of the country’s GDP growth during that period, according to Fortune. He said it’s unlikely the economy would have completely stalled without this boom, saying that “absent the AI boom we would probably have lower interest rates [and] electricity prices, thus some additional growth in other sectors. In very rough terms that could maybe make up about half of what we got from the AI boom,” as quoted by Fortune.
Big Tech Companies Like Microsoft, Amazon, and Nvidia Drive the AI Boom
Major tech companies, including Microsoft, Google, Amazon, Meta, and Nvidia, have invested tens of billions of dollars to expand and upgrade data centers to meet the growing demand for artificial intelligence and large language models that need vast computing power, according to the report.ALSO READ: These are the major US airports facing delays due to the government shutdown — avoid at any cost
Hyperscaler Capital Spending Nears $400 Billion a Year
Lisa Shallet, Chief Investment Officer at Morgan Stanley Wealth Management, said that spending among these “hyperscalers” has risen sharply, as per Fortune. She said that, “In recent years, hyperscaler capex on data center and related items has risen fourfold and is nearing $400 billion annually,” adding, “The speed of growth and size of the investment are skewing its aggregate economic impact, with the top 10 spenders accounting for nearly a third of all spending … For perspective, it’s estimated that data center-linked spending is adding roughly 100 basis points to U.S. real GDP growth,” as quoted by Fortune.
Non-Tech Sectors Like Manufacturing and Real Estate Are Losing Steam
The tech-driven expansion comes as other parts of the economy struggle, as per the report. Job creation has slowed, and sectors such as manufacturing, real estate, retail, and services have contributed little or even detracted from total output in early 2025, as per the Fortune report.
Economists Puzzled as Growth Remains Strong Despite Slowing Jobs
Despite that, GDP data still shows strong overall growth. Apollo Global Management Chief Economist Torsten Sløk noted in early October that economists have repeatedly expected a slowdown that hasn’t happened. Sløk said, “The consensus has been wrong since January,” adding that the average of economists’ forecasts has said the U.S. economy would slow down for nine months consecutively, “But the reality is that it has simply not happened … We in the economics profession need to look ourselves in the mirror,” as quoted in the Fortune report.
FAQs
What did Jason Furman say about US GDP growth?
He warned that almost all US economic growth in the first half of 2025 came from data centers and tech investment, as per the Fortune report.
Which companies are driving this data center boom?
Major tech firms like Microsoft, Google, Amazon, Meta, and Nvidia are leading the investment surge, as per the Fortune report.
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