August 25, 2025

Hi, everyone. My name is Taylor St. Germain with ITR Economics. Thanks so much for joining me on this episode of TrendsTalk. Today I wanted to talk about technology and the growth that we’re seeing in some of what we refer to as these high-tech sectors.

I want to remind you all of a topic that I discussed in a previous Trends Talk episode, which is that we look at US Industrial Production. When we started to really pull apart Industrial Production and look at the different components, one thing that has become very clear is that if you look at the high-tech production space versus what I’d call more of the legacy industrial production or legacy manufacturing, there’s very different reality in the two worlds. So if you look at what I’d refer to as legacy manufacturing, think of auto, oil, and gas as an example, that trend has been flat for essentially the last 20 years. We haven’t seen much growth in what I’d call the legacy manufacturing or industrial sector here in the US.

Now, the opposite is true when we look at the high-tech sector. So when I look at high-tech production growth, I’m referring to things like computers, electronics, data centers, communications equipment, semiconductors, we’ve seen almost linear growth over that same period of time. So it’s clear that when we look at our broader industrial economy or broader manufacturing economy, much of that growth is coming from the high-tech space. So I started to dive into looking at some of the different high-tech sectors, and it becomes very clear when I get even more granular, we can see where a lot of that growth is coming from.

I highlight something like data centers. Many of you are very well aware of the growth that we’ve seen in data centers. The current growth rate year-over-year for data center construction here in the US is 44.2%. I highlight this because I know on past episodes or even when we think about the broader economy, there’s a lot of folks saying, “Well, Taylor, our markets are negative. This industry is still negative or down year-over-year. Where is this growth coming from?” And again, the high-tech space is clearly showing that, with data centers being one of those areas. We’re forecasting double digit growth in data centers over the next three years. And again, that growth rate is currently at 44.2%. So rather than looking at some of what I’d call the legacy industries, yeah, oil and gas is still up 2%, we have the automotive industry just treading water above the zero line. But there are some significant areas of growth when you look at that high tech space, data centers one of them at 44.2%.

I spent a lot of my career in the semiconductor world, and I was looking at the semiconductor data as well. America’s semiconductor shipments are up 48.1% year-over-year. Folks, there is some massive growth out there in our economy, but it’s clear that it’s coming more from that high-tech space. So I wanted to just highlight some of those things in this episode of TrendsTalk because I feel like a lot of our conversation has been, when will the growth come back? When we finally see some of these different vertical markets growing? But there is a lot of growth in some of these technology vertical markets. So the more, as businesses, we can continue to penetrate these high-tech industries, support these high-tech industries, it’s clear that’s going to benefit us from a growth standpoint moving forward.

It’s just a reminder that we are in such a big economy here in the US that, yes, we spend time worrying about where GDP is, we spend time focusing in on industrial production or capex, when our business is finally going to increase investment. But let’s not lose sight of the fact that there’s a number of industries here in this country that are growing and are growing well above pace of the broader economy. Look for those opportunities. That’s really the point of my message here. There are significant opportunities for growth out there. We just have to continue to diversify ourselves into these segments, as we’re very optimistic about them for years to come.

So I wanted to share some good news today. That was really the point of our conversation. Let’s share some good news. Let’s look at where this economy is really flourishing and that high-tech space is no exception to that. I hope you found this information helpful. Thanks so much for joining me on this episode of TrendsTalk. Please like and subscribe to TrendsTalk wherever you listen to your podcasts. I look forward to seeing you on the next one. Thanks so much. Take care for now.