Road, bridge, and sewer infrastructure improvements face delays as the AI data centre construction boom diverts resources from the construction market. Private spending on data centre construction reached an annualised run rate exceeding $41 billion, roughly matching state and local government spending on transportation construction, according to Census Bureau data. In 2025, state and local governments sold a record amount of debt for the second consecutive year, with strategists predicting another $600 billion in sales next year to fund infrastructure projects.
These competing projects face labour shortages driven by retirements and President Donald Trump's immigration crackdown, intensifying competition for construction workers. Andrew Anagnost, CEO of architecture and design software maker Autodesk, stated there is absolutely no doubt that data centre construction sucks resources from other projects, warning that many infrastructure projects will not progress as quickly as anticipated. The convergence of record-breaking public infrastructure funding and surging private data centre investment creates unprecedented strain on the construction sector, with both initiatives demanding similar resources simultaneously.
The $41 billion annual private expenditure on data centres now rivals government transportation spending, marking a fundamental shift in construction priorities. This resource competition threatens to undermine public infrastructure renewal efforts precisely when governments have mobilised historic levels of funding to address deteriorating roads and bridges. The labour shortage compounds these challenges, as the construction industry lacks sufficient workers to meet both public and private sector demands, potentially delaying critical infrastructure improvements for years.
Sources:
https://techcrunch.com/2025/12/13/ai-data-center-boom-could-be-bad-news-for-other-infrastructure-projects/
https://www.bloomberg.com/news/newsletters/2025-12-12/ai-data-center-boom-may-suck-resources-away-from-road-bridge-work
