Was AI the main driver of US GDP growth in 2025?

No, consumer spending remained the primary pillar of GDP growth in 2025, although AI was a secondary driver.

How did AI investments affect the US economy in 2025?

AI investments contributed to GDP growth, primarily through software, but their overall impact was tempered by significant import costs for high-tech equipment.

When does consumer spending typically decline during an economic downturn?

Historically, consumer spending usually weakens after job losses have mounted and a recession is already well underway.

Home / Business and Economy / AI Bubble Fears Overblown? Consumers Still Drive US Economy

AI Bubble Fears Overblown? Consumers Still Drive US Economy

27 Jan

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Summary

Consumer spending, not AI, was the primary driver of US GDP growth in 2025.
AI's contribution to GDP is less than believed due to significant import costs.
Consumer spending typically weakens only after job losses and recessions begin.

AI Bubble Fears Overblown? Consumers Still Drive US Economy

In 2025, consumer spending continued to be the primary engine of the US economy, rather than the artificial intelligence sector, a January report by Macro Research Board Partners revealed. Economic strategist Prajakta Bhide stated that while AI contributed to GDP growth, a substantial portion of related investments involved imported high-tech equipment, which does not factor into GDP calculations. Imports reduced the overall impact of AI on economic growth.

Bhide emphasized that personal consumption, the spending by everyday people, remained the most significant contributor to GDP. While consumer sentiment has been affected by slower income and job growth, actual spending patterns have remained robust. The report indicated that AI's impact, particularly from software investment, was a secondary driver, with data center contributions being minimal.