Without data centers, GDP growth was 0.1% in the first half of 2025
4 hours ago
- #GDP growth
- #AI investment
- #data centers
- U.S. GDP growth in the first half of 2025 was primarily driven by investment in data centers and information processing technology.
- Excluding tech-related categories, GDP growth would have been just 0.1%, highlighting the critical role of high-tech infrastructure.
- Investment in information-processing equipment and software accounted for 4% of GDP but 92% of GDP growth during this period.
- Tech giants like Microsoft, Google, Amazon, Meta, and Nvidia invested heavily in data centers due to AI demand.
- Hyperscalers' capex on data centers has risen fourfold, nearing $400 billion annually, adding ~100 basis points to U.S. GDP growth.
- Despite strong GDP growth, other sectors like manufacturing and real estate contributed little or negatively to output.
- Economists have struggled to explain the paradox of strong GDP growth amid sluggish job creation and economic concerns.
- Jeff Bezos views the data-center boom as an 'industrial bubble' rather than a financial one, emphasizing long-term benefits.