March 30, 2026

The below transcript is a translation of the podcast audio that has been machine generated by Notta.

Hi everyone, this is Taylor St. Germain with ITR Economics. Thanks so much for joining me on this episode of TrendsTalk. We at ITR, your source of apolitical and unbiased economic intelligence. And today I wanted to discuss AI. Our former CEO, now Brian, and my colleague Connor, one of our public speakers, gave a great presentation. It was a webinar that’s still available through our website if you wanted to check it out, but they shared some awesome AI data. And every conference that I’m at, regardless of the industry, there is conversation about AI and for good reason. And I wanted to actually put some data to these conversations and share some of our thoughts today.

So the first thing I wanted to highlight, the first data set that we’re tracking is US AI investment. And when I say US AI investment, this is a data series that comes from the SEC and it is looking at dollar denominated investment in AI. If you look at the 12 month moving total for this data set, that 12 month moving total is at $560.9 billion. So over the last 12 months, we have seen $560 billion invested in AI. Now, as far as a growth rate goes, that’s actually a slowing growth rate. The growth rate has been slowing down really for the better part of this last year. Now, when I say slowing down, the annual growth rate for AI investment is still up, almost 67%. So slowing should almost be in quotes. We are still seeing a significant increase year over year. It’s just a little bit slower than the pace that we saw coming in to 2025. So it’s clear though, $560 billion over the last 12 months is nothing to balk at. Folks continue to invest in AI.
But we have noticed that certain industries, certain companies are leveraging AI in a greater capacity compared to others.

Again, in that webinar that Connor and Brian presented just about a week ago, they shared this amazing chart, which was basically survey estimates by industry of the industries that were utilizing AI in the biggest capacity. So information, as you can imagine, was above 40%. So 40%, that’s the companies that reported using AI in January over two weeks. So information led the way up there at 40%. All the way at the bottom at sub 5% was mining in oil and gas. But again, I really wanna highlight, everyone’s using AI in some capacity. It’s just some are using it in a greater capacity. So information, educational services, finance and insurance, those were all at the top of the list. Again, all above that 30% AI usage.

Well, you had manufacturing, retail trade, construction, all closer to that 10% level. And again, transportation, oil and gas really coming in below that 5% mark. So there’s some wide variation in who’s actually utilizing AI, but everyone is to some extent. Now, what we also found interesting in the data was not just the industry breakdown of who’s utilizing AI, but the difference between some of the large firms and the smaller firms out there. So we found that the firms that had 250 or more employees had an average AI usage of about 13%. If you looked at the firms under 250 employees, that number was closer to eight and a half, 9%. So it’s clear that the larger firms are utilizing AI in a way that some of the smaller to mid-side firms ultimately aren’t.

Now, the reality is, I wanna tie this back to our economic outlook and how we’re thinking about the economy moving forward. We’ve been talking about this demographic issue and the labor challenges that are persistent and that are out there. And yes, AI, again, for some of those high usage sectors is going to be an important way to drive productivity, to offset some of the rising labor costs. But where my worry is, when I think about the labor market still today, it’s the manufacturers, it’s the construction workers, it’s trucking and logistics. And these industries still have a very low utilization of AI. We still have a large number of job openings in these blue collar type industries. And while AI is continuing to make steps in the right direction to even help out some of these blue collar industries, it’s not going to be in time to offset some of the inflation, some of the challenges that we ultimately see over the next few years.

So yes, AI is important. We need to leverage these technologies. I tell clients that from the stage. It’s very important to us because of the higher inflation, because of the higher labor costs, any way we can find productivity gains is going to be important. But to me, AI still isn’t addressing where the biggest labor shortage ultimately is. And that’s in the blue collar industries. And especially for those smaller to mid-sized firms, AI doesn’t seem to be the silver bullet that everyone is suggesting that it ultimately might be. Folks, we are still forecasting the cost of labor here in the United States, even with AI adoption to increase about 20.1% throughout the second half of this decade. I am not a negative on AI. I think AI is important and it needs to become a bigger part of our conversation to drive our productivity. But again, I just don’t think it’s the silver bullet that everyone ultimately expects it to be. There is a lot of money and a lot of dollars following this AI trend, and that’s why we follow it very closely. But for manufacturing, construction, trucking, some of these blue collar industries, people still really matter. And I think it’s important that we acknowledge that trend.

We’ll continue to update you on AI. And again, Connor and Brian really dove into this data. If you wanna see this data visually, if you wanna take a look at some of their assumptions and some of the comments they made, it was very useful. And I think they did a great job of putting that in perspective. Head over to our website, look for the profit list prosperity webinar that we gave, again, just about a week ago, a lot of great information there. We’ll continue to talk about AI moving forward, but for now, I hope you found this helpful. Please like and subscribe to TrendsTalk wherever you listen to your podcasts. I look forward to seeing you all in the next one. Thanks so much. Take care for now.