What AI Really Means for the Economy: Alfonso Berumen Weighs In

As AI continues to dominate headlines, economists and business leaders are debating whether the technology is propping up the U.S. economy, or masking deeper structural weaknesses. In a recent InformationWeek analysis, Alfonso Berumen, faculty member at Pepperdine Graziadio Business School, weighed in on AI’s economic role, offering a nuanced perspective for CIOs and investors alike.

"AI investment is boosting productivity and capital spending, but it is not the sole force holding up the U.S. economy," Berumen said. "Growth is a different story. Recent estimates suggest AI-related investment accounted for more than two-thirds of the 1.6% annualized GDP growth in the first half of the year."

Berumen explained that while AI isn’t the foundation of the economy, it is disproportionately driving incremental growth. "If AI investment slows, headline GDP could weaken quickly because other sectors are contributing far less to marginal growth," he noted.

The InformationWeek piece highlights the broader debate over a potential AI bubble, with hyperscaler spending and massive data center construction fueling economic momentum. While some experts warn of overvaluation in pockets of the AI sector, Berumen emphasized that the technology alone isn’t sufficient to sustain broader economic stability.

For CIOs and business leaders, Berumen’s insights underscore the importance of strategic planning. A slowdown in AI adoption could expose vulnerabilities in other sectors, making proactive budgeting, prioritization of high-value AI projects, and careful monitoring of investment returns essential.

As the U.S. economy balances on the promise of AI, Berumen's analysis reminds leaders that while technology can accelerate growth, resilience requires attention to the broader structural landscape.

Read more here.