Business investment hits decade high as data centre boom accelerates

Australian business investment has surged to its highest share of GDP since the mining construction boom of the early 2010s, new analysis from the Committee for Economic Development of Australia (CEDA) reveals. The nation's rapid build-out of data centres and digital infrastructure are the primary drivers.

CEDA's latest business insights report shows total business investment spending reached 12.6 per cent of GDP in the June quarter of 2026, the highest level recorded since 2015. Based on Reserve Bank of Australia (RBA) forecasts and surveyed capital expenditure (CAPEX) intentions, investment is expected to peak over 13 per cent of GDP during 2027-28, before easing back towards its recent average.

The report finds the surge is being driven almost entirely by the information, media and telecommunications industry, as businesses invest heavily in data centres, cloud computing and artificial intelligence infrastructure. CAPEX by this industry, almost doubled in 2025-26, compared to one year earlier (in inflation-adjusted terms). This single industry accounted for 22 per cent of all non-mining CAPEX in 2025-26, more than doubling its contribution from a year prior.

Other industries that notably stepped up their investment activity during 2025-26 included administrative services (+17% annual CAPEX volume), transport services (+15%), healthcare (+14%) and retail trade (+12%). In contrast, Australia’s giant mining sector grew its CAPEX by only 1.4 per cent but it still dominated the numbers, accounting for around a quarter of total business CAPEX.

Almost all of the equipment for data centres is imported. Automatic data processing machines and parts, including servers, GPUs and networking equipment, were the single largest category of goods imported in 2025-26, with a value of $23 billion, up 60 per cent year-on-year. That is larger than Australia's total annual imports of either freight trucks or telecommunications equipment.

CEDA Economist Julie Toth said the scale and speed of the investment shift underlined how central digital infrastructure had become to the next phase of Australia's economic growth.

“Business investment is one of the most important drivers of the future productivity, and what we’re seeing now is a once-in-a-generation shift in where that investment is going,” Ms Toth said.

“The data centre and AI infrastructure boom is lifting business investment to levels not seen since the mining construction boom over a decade ago.”

Business investment in software has also climbed, up 9 per cent year-on-year to June 2026, overtaking business spending on research and development in 2021. This is set to rise further as AI and other digital technologies are adopted more widely across the economy.

“While the IT and telecommunications boom is grabbing the headlines, it’s encouraging to see other large services sectors also lifting investment strongly and finally moving past their pre-pandemic CAPEX peaks. Government and industry need to keep a close eye on how this investment translates into productivity gains across the wider economy, not just the sectors building the infrastructure.”

<Ends>

Note to editors

Sources: ABS National Accounts, March 2026; RBA Statement on Monetary Policy, August 2026; ABS CAPEX, March 2026; ABS International Trade in Goods, June 2026.

MEDIA CONTACT
Lisa Harmer
Media and Government Relations lead
E: Lisa.harmer@ceda.com.au
M: 0436 379 688