The investment boom in new hi-tech manufacturing plants is unprecedented, but that boom still hasn’t fed through into higher output or employment in hi-tech manufacturing and investment in IT equipment has been muted in recent quarters. Software investment is still expanding at a healthy clip, but there are no signs yet of an AI-related boom. Construction spending on manufacturing structures has more than doubled in the past 12 months, boosted by the production subsidies included in the CHIPS and Inflation Reduction Acts. Spending on building new manufacturing facilities is now almost equal to all the spending on new office, retail and other commercial buildings combined, which will help to offset weakness in those other sectors that will be hardest hit by structural headwinds, like the shift to working from home.
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