Can AI data center construction lead to a revival in factory jobs?
In response to the strong April jobs report, the White House on Friday suggested that factory workers can count on job growth in the long run, citing a specific metric that is heavily weighted toward artificial intelligence spending.
White House Senior Deputy Press Secretary Kush Desai highlighted “nonresidential specialty trade contractors,” a subset within a subset of the construction sector that is closely associated with data center construction. That category saw a jump from 2.8834 million jobs in March to 2.8960 million in April.
“America added 12,600 factory construction jobs in April as trillions in investments continue pouring into American manufacturing,” Desai wrote on X, adding it was a “leading indicator … that the best is yet to come.”
“The factory boom that President Trump has talked so much about is visible everywhere,” Kevin Hassett, the director of Trump’s National Economic Council, added during an appearance on Fox News. “We’ve got about 70,000 people who have jobs now building factories.”
Since January 2025, when Trump took office, nonresidential specialty trade contractor jobs have grown by 67,000, but the rest of the construction sector has contracted, according to the government data. And it’s far from certain that the build-out of AI data centers will translate into a significant number of permanent jobs down the road.
Data centers can indeed employ thousands of workers as they are being built, but they employ just dozens, or perhaps 100 employees, once operational.
A parallel decrease in actual factory jobs
The White House’s focus on Friday also overlooked less-flattering results for their manufacturing efforts seen in Friday’s report.
Factories lost about 2,000 jobs in April and are now down about 66,000 jobs over the last 12 months and about 77,000 jobs since Trump took office for his second term.
In addition to the monthly decrease in manufacturing jobs, the jobs report showed that the US shed construction jobs outside of those “nonresidential specialty trade contractors” — especially among construction workers who build homes.
A White House official said they focused on the 12,600 number as a metric because growth in those specialty jobs was also consistent with other leading indicators they are tracking that could translate to the manufacturing sector, such as core capital goods orders, non-residential fixed investment growth, foreign investment commitments, and more.
Read more: How jobs, inflation, and the Fed are all related
‘First you are seeing construction’
Manufacturing jobs are up when looked at on a quarterly basis — thanks to a jump of about 15,000 jobs between February and March — which Acting Labor Secretary Keith Sonderling was quick to note in an interview with Yahoo Finance on Friday.
He dismissed the decrease in manufacturing jobs in April as “nominal” as he emphasized the link between construction and manufacturing jobs. “Everything is coming according to the plan that the president has for the economy,” he said.
Sonderling made the link more explicit on CNBC, saying, “the jobs are coming, and first you are seeing construction.”
But the link between data center construction and blue-collar job growth is far from clear.
In addition to data centers leading to fewer permanent jobs, other indicators show that traditional factory construction may be on the decline.
The US Census Bureau tracks business spending specifically on factories. That number has been moving consistently downward after a peak in mid-2024. That data shows spending on factories fell by over 15%, or almost $30 billion, over the last year alone.
Yet the boom in AI data center construction spending is widely expected to stay high in the coming months.
The Associated Builders and Contractors trade group recently estimated that they will need 349,000 new workers this year and 456,000 in 2027.
The report specifically highlighted growth in nonresidential specialty trade contractor jobs as evidence of how “certain sectors of nonresidential construction hiring are going strong.”
Ben Werschkul is a Washington correspondent for Yahoo Finance.
Read the latest financial and business news from Yahoo Finance