AI data center boom could be bad news for other infrastructure projects
A surge in AI data centre construction may slow down traditional infrastructure projects, as both sectors compete for labour and resources. State and local governments are issuing record levels of debt to fund transportation and public works, while private data centre spending has reached an annualised $41 billion. Analysts warn that labour shortages and immigration restrictions could further delay infrastructure improvements.
The accelerating growth of AI-driven data centre construction may come at the expense of traditional infrastructure projects such as roads and bridges, according to a new Bloomberg report.
In 2025, state and local governments reportedly issued a record amount of debt for the second consecutive year, with analysts projecting another $600 billion in municipal debt sales next year. Much of that funding is intended for major public infrastructure initiatives.
At the same time, Census Bureau data indicate that private spending on data centre construction has surged to an annualised rate of more than $41 billion—nearly matching what state and local governments spend annually on transportation-related construction.
This rapid expansion means data centre builds and public infrastructure projects may soon compete for the same pool of construction workers, even as the sector faces growing labour shortages driven by retirements and President Donald Trump’s immigration crackdown.
Andrew Anagnost, CEO of Autodesk — a leading company in architecture and design software — told Bloomberg there is “absolutely no doubt” that data centre development pulls labour and resources away from other essential construction work.
“I guarantee you a lot of those [infrastructure] projects are not going to move as fast as people want,” he said.
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