A Mirage of Momentum: America’s Uneven AI Boom

Wall Street voices see history repeating itself.

A deep divide is opening in the U.S. economy as artificial intelligence surges while the nation’s manufacturing sector falters. Both industries have been celebrated in Washington as anchors of a modern revival, but their paths have sharply diverged—one booming on speculation and the other shrinking under tariffs and rising costs.

President Donald Trump has promised to do “whatever it takes to lead the world in artificial intelligence,” even as the White House pursues policies aimed at restoring American manufacturing might. The results tell a different story. Artificial intelligence has become the symbol of investor exuberance, driving record valuations and vast capital flows, while factory payrolls continue to erode.

The Bureau of Labor Statistics shows the United States has lost roughly 38,000 manufacturing jobs since the start of the year, part of a decades-long slide that has left the country with fewer than 13 million factory workers.

“You have the software and services world accelerating, and becoming almost a monomania for the culture, at the same time that manufacturing remains flat or worse,” Mark Muro, a senior fellow at the Brookings Institution, told The Washington Post. “The AI boom is kind of papering over some other parts of the economy that aren’t going well.”

Even as America’s AI boom deepens its divides, Wall Street voices see history repeating itself. CNBC’s Jim Cramer compared today’s generative AI frenzy to past industrial revolutions — from the rise of the railroads to the dawn of the internet — arguing that massive investment and inevitable casualties are both part of technological transformation.

“This is just the beginning,” Cramer said. “The buildout will have casualties. So did the rise of the railroads. So did the steam engine and the assembly line and the internet.”

UBS forecasts global AI spending will reach $375 billion in 2025 and exceed $500 billion by 2026, as Big Tech pours unprecedented capital into infrastructure and chipmaking. Nvidia, the biggest winner of the moment, has become the first company in history to hit a $4 trillion market valuation — a milestone that captures both the optimism and the imbalance of this new industrial revolution.