AI Data Center Boom Threatens to Delay Road, Bridge, and Infrastructure Work

Construction Resources Increasingly Diverted to Data Center Projects

As artificial intelligence technology continues to accelerate development and investment, the construction industry is facing an unexpected consequence: road repairs, bridge reconstructions, and sewer overhauls are at risk of getting delayed as the data center boom sucks up resources in the construction market.

This competitive dynamic, detailed in Bloomberg's Industrial Strength newsletter published December 12, 2025, reveals a critical tension between high-growth AI infrastructure projects and traditional public infrastructure maintenance—exactly as the nation faces a $3.7-trillion infrastructure funding gap and a 2026 federal funding deadline.

The Data Center Construction Boom

The surge in data center construction reflects explosive growth in AI development. Major technology companies and startups are investing billions in data center capacity to support large language models, artificial intelligence training, and cloud computing services.

Recent examples include:

• Anthropic's $50 Billion Data Center Plan: AI powerhouse Anthropic unveiled a massive plan to build US data centers with UK-based cloud partner Fluidstack, starting with projects in New York and other locations
• Exponential Growth: Data center construction projects have proliferated across the country as companies compete to secure computing infrastructure capacity

Resource Competition in the Construction Market

The influx of capital into data center projects is creating fierce competition for:

• Skilled Labor: Electricians, structural engineers, HVAC specialists, and other specialized workers are being recruited by lucrative data center projects
• Materials and Equipment: Long-lead electrical components, cooling systems, and specialized infrastructure materials are increasingly claimed by data center projects
• Contractor Capacity: Top-tier construction management firms and engineering companies are devoting resources to high-margin data center work
• Real Estate and Land: Prime locations are being secured for data center development, reducing availability for other infrastructure projects

Impact on Municipal and Public Infrastructure Projects

The competitive pressure threatens to delay essential infrastructure maintenance and construction:

• Water and Wastewater Systems: Critical sewer overhauls and water main replacements may face scheduling delays as municipal agencies compete for contractor availability
• Transportation Infrastructure: Road repairs and bridge reconstructions could experience setbacks as construction crews and project managers are drawn to higher-paying data center work
• Public Facilities: School improvements, hospital expansions, and other essential public projects may face longer timelines
• Municipal Bonding Constraints: Rising construction costs for data center projects may inflate labor and material costs for all construction, impacting municipal budgets

Timing Concerns: The 2026 Deadline

This resource competition arrives at a particularly challenging time for U.S. infrastructure. According to the American Society of Civil Engineers' 2025 Infrastructure Report Card (December 12, 2025), federal infrastructure funding through the Infrastructure Investment and Jobs Act authorizations is set to expire in 2026, creating an urgent need to complete projects before funding uncertainty increases.

The competition for construction resources from data center projects could accelerate the timeline pressure on traditional infrastructure work—forcing municipalities to rush projects or defer critical maintenance.

Strategic Considerations for Contractors and Municipalities

For Contractors and Construction Firms:

• Workforce Strategy: Invest in training and retention to maintain competitive staffing levels across both data center and traditional infrastructure projects
• Specialization: Consider dual capabilities in both high-tech data center construction and traditional infrastructure work to capture opportunities in both markets
• Supply Chain: Secure long-term material supply agreements to avoid competing for limited resources

For Municipal and Public Agencies:

• Project Acceleration: Fast-track critical infrastructure projects ahead of 2026 funding expiration and data center resource competition
• Alternative Delivery: Consider design-build, progressive design-build, and other collaborative contracting approaches to reduce project schedules
• Regional Coordination: Coordinate with neighboring municipalities to consolidate projects and improve bidding strength

The Broader Economic Context

The data center boom reflects genuine innovation and technological progress. However, it also highlights a fundamental infrastructure challenge: the construction industry has limited capacity, and high-margin AI and tech projects are attracting disproportionate resources compared to essential public infrastructure that generates lower financial returns for contractors.

This imbalance may require policy-level solutions, including:

• Increased federal or state funding guarantees for critical public infrastructure
• Tax incentives for contractors who balance data center work with public infrastructure commitments
• Workforce development initiatives to expand the construction labor pool across all sectors

Looking Ahead

As AI investment continues to accelerate and data center construction booms, the construction industry and infrastructure planners must navigate competing demands. The window to leverage 2026 federal infrastructure funding is narrowing, and the additional pressure from data center competition makes strategic planning more critical than ever.

Contractors, engineers, and public officials who adapt to this new competitive landscape will be best positioned to deliver both cutting-edge AI infrastructure and essential public services.

Source: Bloomberg, Industrial Strength newsletter, December 12, 2025 - "AI Data Center Boom May Suck Resources Away from Road, Bridge Work" by Brooke Sutherland. American Society of Civil Engineers, 2025 Infrastructure Report Card, December 12, 2025.