The business investment landscape in the United States at the close of November 2025 is characterized by a “K-shaped” recovery, where growth is not only uneven across sectors but also increasingly split between high-growth, AI-driven firms and more cautious, legacy industries. This emerging trend, as highlighted by consultancy firm EY-Parthenon, reflects the ongoing economic challenges faced by different parts of the business world, with tariffs and trade policy uncertainty serving as key drivers of this divergence.
Overall, U.S. GDP growth for 2025 is expected to finish at around 2.0%, with projections for a slight slowdown to approximately 1.9% in 2026. This modest dip is not necessarily indicative of a broader downturn but rather a reflection of the mixed growth across sectors. The primary cause of the uneven growth can be traced to the lingering uncertainty surrounding tariffs and trade policies. For industries outside the rapidly expanding technology and AI sectors, these tariff-related headwinds have resulted in a more cautious approach to capital expenditures. Increased input costs, coupled with concerns about trade policy volatility, have made firms in traditional industries wary of committing to major investments.
On the other hand, firms within the technology and AI sectors are leading the charge in terms of business investment. The growth in artificial intelligence, software development, research and development (R&D), and information-processing equipment is driving a significant portion of U.S. economic activity. In fact, in the first half of 2025, these AI-related investments contributed to roughly one-third of GDP growth. For companies that are focused on technological innovation, AI is seen not just as a potential growth area but as the key to future competitive advantage. These firms are making aggressive investments to capitalize on the rapidly evolving technological landscape, positioning themselves to dominate in areas such as machine learning, automation, and data analytics.
This “K-shaped” recovery paints a picture of two very different realities for U.S. businesses. For many traditional sectors, particularly those in manufacturing, retail, and certain service industries, the prospect of rising input costs and the unpredictability of trade policy are causing significant hesitation in spending. Many of these firms are holding back on capital expenditures, re-evaluating their strategies and trying to wait out the storm of uncertainty. The risk of engaging in large-scale investment, particularly without clarity around future trade relationships, has prompted many companies to adopt a more conservative posture.
Meanwhile, the tech sector, particularly those invested in AI, is seeing considerable optimism. These companies are aggressively ramping up investments, seeing AI not only as a growth opportunity but as a long-term strategic priority. The first half of 2025 has shown AI to be a dominant contributor to the economy, with software development, R&D, and equipment related to AI technologies playing an outsized role in driving growth.
For corporate strategists, this environment presents a clear message: there is a pressing need to balance caution with boldness. Traditional industries will need to tread carefully, managing risks associated with tariffs and trade policy uncertainty, while also finding ways to maintain a competitive edge. On the other hand, businesses that have the resources and the appetite for risk in the technology space should be positioning themselves for continued aggressive investment in AI and other cutting-edge innovations.
Looking ahead to 2026, this divergence in business investment strategies may define which companies thrive and which struggle. Those that can navigate the uncertainty of trade policies while capitalizing on the technological opportunities of AI may well find themselves at the forefront of the next wave of growth. Conversely, companies that fail to adapt to the rapidly changing technological landscape risk being left behind, as AI and technology-enabled growth become central to future economic success.
In this climate of mixed business investment, firms must evaluate their capital allocation strategies carefully. Balancing traditional business operations with forward-thinking investments in technology will likely determine competitive advantage in the years to come. The “K-shaped” recovery underscores the importance of adaptability, with businesses that can pivot toward high-growth, AI-driven sectors poised to capitalize on the ongoing economic transformation.
