SAN FRANCISCO: Five leading technology companies collectively will spend approximately $700 billion on AI infrastructure in 2026, nearly doubling last year’s expenditures and triggering widespread shortages across the American economy.
Amazon, Google, Microsoft, Meta, and Oracle are building massive data centers stuffed with specialized chips. The spending equals three-quarters of the annual U.S. military budget. It exceeds the GDP of Israel or Switzerland.
The capital deployment is creating severe bottlenecks. Electricians are increasingly hard to find. Some construction projects face indefinite delays. Smartphones will likely cost more for years.
Data center construction spending rose 32% in 2025 through October. Spending on other commercial real estate remained flat or declined. There aren’t enough skilled electricians for both data center projects and complex construction like apartment buildings, factories, health care facilities.
AI data centers prove more lucrative for construction firms. That relegates everything else to lower priority. OpenAI told the White House its planned data centers require roughly 20% of the existing skilled tradespeople workforce.
Associated Builders and Contractors says construction will be short nearly half a million workers next year. The boom is worsening chronic capacity shortages.
Memory chip demand has driven up prices for smartphones and laptops. Apple informed investors of supply issues for iPhone and Mac chips. Semiconductor manufacturers prioritize the more lucrative server market.
Amazon announced $200 billion spending this year, a 56% increase over last year. Google plans $180 billion investment. Amazon shares tumbled 9% Friday morning after the announcement.
JPMorgan analysts calculate tech needs generating additional $650 billion annual revenue to earn reasonable returns on investment.
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