Data Centre Spending Fuels US GDP Growth Amid AI Concerns

On October 10, 2025, a report highlighted that investment in data centres and information processing technology significantly impacted the United States economy. According to Harvard economist Jason Furman, GDP growth in the first half of 2025 was nearly entirely driven by spending in this sector, leading to concerns about the sustainability of such rapid investments.

The analysis, published by Fortune, revealed that without the robust spending on data centres and related technologies, the growth rate for the U.S. economy would have plummeted to just 0.1%. This figure underscores the critical role that high-tech infrastructure plays in shaping broader economic trends. In fact, estimates from Renaissance Macro Research suggest that the contribution of AI data centre expenditures to GDP growth in early 2025 even exceeded consumer spending, marking a significant shift in economic dynamics.

Investment Trends and AI’s Role

Most of the substantial investment in data centres stems from technology companies striving to enhance their artificial intelligence (AI) capabilities. The drive to make AI ubiquitous across various applications has become a priority for these corporations. Once associated with lofty goals such as addressing climate change and improving healthcare, AI’s focus has shifted towards more immediate applications, including generating text and multimedia content.

Critics argue that the technology sector’s rush to integrate AI into existing processes often lacks a clear rationale. Many applications are being modified to include AI features without sufficient justification or evidence of their necessity. As a result, there is growing concern that technology companies are pushing AI adoption primarily to protect their investments, fearing significant repercussions if the technology does not achieve widespread acceptance.

Warnings from Financial Institutions

Recent warnings from the Bank of England and the International Monetary Fund have further intensified scrutiny around the AI investment landscape. The Bank of England cautioned that equity market valuations for technology companies focused on AI appear overstretched, indicating a heightened risk of a market correction. Their statement emphasized that if expectations surrounding AI’s impact become less optimistic, equity markets could face significant vulnerabilities.

“On a number of measures, equity market valuations appear stretched, particularly for technology companies focused on artificial intelligence,” the Bank of England stated.

Such warnings have prompted skepticism regarding the sustainability of AI investments, with many questioning whether tech companies are over-promising and under-delivering on the benefits of AI. The emergence of terms like “AI slop” reflects a growing disillusionment with hasty implementations of AI that often disregard essential ethical considerations.

Furthermore, the environmental impact of constructing numerous data centres is drawing criticism at a time when a global commitment to sustainability is paramount. Critics argue that the focus on building resource-intensive facilities is counterproductive to the goal of achieving net-zero emissions. The prioritization of energy resources for data centres raises concerns about the implications for energy allocation between technological infrastructure and the needs of the population.

As the tension between technological advancement and ethical considerations mounts, the narrative surrounding AI continues to evolve. While the industry rallies to promote AI as a transformative force, the realities of its impact on society, the economy, and the environment remain complex and contested.

In the coming months, the trajectory of AI investment and its implications for the economy will likely remain a focal point for analysts, policymakers, and the public alike. The balance between innovation and responsibility will be crucial in determining the future landscape of technology and its role in economic growth.