US Economy Increasingly Revolves Around Data Centers, New Report Shows

Key Takeaways

• The U.S. economy increasingly depends on the buildout of data centers, according to the Federal Reserve’s “Beige Book” report.

• Mentions of data centers have surged from one in September 2024 to 25 in the most recent edition.

• Data centers are fueling a construction and power-generation boom while creating jobs in other industries, such as legal services.

The U.S. economy is increasingly organized around constructing data centers and the infrastructure to support them, whether the public likes it or not (and it doesn’t).

The Federal Reserve’s “Beige Book” report, released Wednesday, offers a ground-level look at how the data centers sprouting up everywhere are affecting different regions. Anecdotal reports from across the country say the data centers are sucking up metal, materials, computer chips, and electricity, and spitting out AI services that businesses are increasingly leaning on.

Data centers were mentioned 25 times across the report. That’s up from eight in September 2025 and just one in September 2024.

The Beige Book compiles anecdotal reports from local business, community, and government leaders across the Federal Reserve’s 12 districts. This edition shows that while the economy is growing only modestly overall, data center demand is powering much of the recent growth.

What This Means For The Economy

Data center development is supporting construction and manufacturing, tightening some labor markets, boosting demand for legal and shipping services, and reshaping the power industry. That means far more of the U.S. economy relies on the fortunes of one industry than it did just a couple of years ago.

Spending on data center construction—not counting the computers that go in them—grew to a $75 billion annual rate in July, a 57% increase from July 2025, the Census Bureau said in a separate report out Tuesday. The data center buildout accounted for all of the nonresidential construction growth recorded that month, according to an analysis by Associated Builders and Contractors, a trade group.

Fed contacts in several districts said that data center work was supporting local construction and manufacturing.

“Without data centers, construction would be in a recession,” one contact in Chicago said.

It’s not just construction benefiting from the boom: legal services firms in the Richmond district said they were getting lots of work supporting the industry.

Another contact in the New York district said data center projects were importing large amounts of supplies from China.

In Maryland, construction companies are in a fierce competition for workers as they pursue data center contracts—one firm raised wages 35% across the board.

In Virginia, the nation’s data center capital long before anyone had heard of ChatGPT, some contacts said they worried that local moratoriums on data centers could slow construction and capital investment.

The boom is also affecting power companies, which have scrambled to meet the surge in electricity demand. A section of the Fed report on the Kansas City district described how data center builders are emphasizing speed over cost, even constructing their own power plants to supply their projects.

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