# AI Infrastructure Costs and Supply Chain Risks

**Podcast:** Marketplace
**Published:** 2026-02-05

## Transcript

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Fish tacos.
That's all I'm saying.
From American Public Media.
This is Market Place.
It is Wednesday today.
This one is the fourth of February.
Good as always.
We begin on this Wednesday, as we are wont to do from time to time with an eye on the economic calendar.
The Bureau of Labor Statistics no longer shut down.
Told us this morning that the January unemployment report, originally due on Fridaying to find other ways to measure the labor market at this fraught moment?
The payroll processing company ADP said this morning the economy added just 22,000 jobs in January.
Marketplace's Sabrie Benechore spent his day reading those labor market tea leaves.
Clarence Clue is 43.
He's his own boss.
He's worked in PR in New York for a long time, and he is thinking it is time to branch out.
I see the writing on the wall for the industry in itself.
Businesses are still figuring out AI.
Budgets are on hold.
So he's looking for all kinds of positions.
The world around us is changing rapidly.
I think we should be open to evolving as well.
Easier said than done.
How do I feel about the market right now?
Honestly, I think it's a bit terrifying.
Clue is not alone in feeling that way.
Consumer sentiment is still depressed.
That said, the job market looks to be at least stable.
There's still jobs being added, but it's at a much slower rate.
McRean O'Wilkins is director of market insights at Associated General Contractors of America.
It's hard to tell for sure right now because the government isn't releasing official data.
So economists are looking at other things, like what payroll processors are reporting.
January, we saw 37,000 jobs added by small businesses.
That's right around the monthly average for the past year.
Andrew Chamberlain is chief economist at Gusto, an HR platform serving half a million businesses.
We don't see any evidence of any like bottom falling out of the small business hiring market.
If anything, Chamberlain is cautiously optimistic.
Payroll processing giant ADP reported that from what it sees, the rate of job growth fell by half between 2024 and 2025, but it's been leveling off.
Healthcare is still doing well.
And Chamberlain says those interest rate cuts, the Federal Reserve made last year, are gonna start showing up in the job market.
Borrowing costs are going down, and if you talk to any small business owner, they use loans to cover payroll and like basic day-to-day operations.
So those lower interest rates are oxygen for small businesses that want to grow.
There are other clues too the number of people applying for unemployment insurance has been ticking down the past few months.
Jonathan Pingle is chief economist at UBS.
It does not look like a rapidly growing labor market, but we are expecting decent job gains when the January report is released and we would expect the unemployment rate ticks down a tenth to 4.3%.
Pingle says there really is no substitute for the official numbers, but things are looking okay.
Job hunters hang in there.
In New York, I'm Sabrie Benishore for Marketplace.
We did get some nongovernmental official numbers this morning specifically from the Institute for Supply Management, something called their services PMI that's a purchasing managers index, which in regular person speak is a measure of the health of the services sector of this economy.
That is to see a big chunk of this economy.
The absolute number is 53.8, anything above 50 means services are growing.
The manufacturing PMI, which came in on Monday, showed manufacturing expanded in January by the most it has since 2022.
So that's all good, right?
I think we need to to wait and see before we um get overly excited, if I may.
There's enough headwinds out there that I would be, I I'd say caution is warranted.
Oh, that's Nata Sanders, a professor of supply chain management at Northeastern University, Monica Gorman there as well, managing director at Kroll Global Advisors.
All right, so they are cautious, but why is that?
Yes, this is uh a jump compared to the previous month, but this is January.
We're coming off of the holiday season.
We're typically in a time of reorders.
Um, so it's not not totally surprising that we're seeing some uptick in January.
Okay, what else?
We're also seeing expansion in construction, um, which of course is required to build data centers.
Ah, yes, AI.
But also, how many people are actually working in those data centers, gang?
One of the things that is really clear is that um the employment rate uh has not does not seem to be following.
I think if you look at employment, for instance, we're continuing to see contractions in employment.
Um that's what people are gonna be feeling.
As we have said, a time or two, I do believe headlines are great, but what really matters is how people are feeling about this economy in their day-to-day.
I think we're gonna want to watch and see uh where this goes from here.
Is this a trend or is this a blip in what has otherwise been a bit of a downturn for a number of years?
Watch and see we shall, which is mostly what did not happen on Wall Street today.
Tech stocks led the way down.
We will have the details when we do the numbers, and I'm gonna go ahead and see how we're gonna be able took something of a detour on my morning commute the other day and stopped at a two-story bright blue and yellow building in South Los Angeles, just a couple of blocks from the University of Southern California.
All right, here we are.
Mercado La Paloma.
There's all kinds of stuff in here.
Inside, it's a food hall of sorts, a bunch of restaurants, some retail too.
And one of the first spots on the left is Holbosch.
It's a Mexican seafood restaurant that's won every culinary recognition going from Michelin and James Beard to the Los Angeles Times and Yelp.
A taco costs you around seven bucks.
Two nights a week, they do an eight-course tasting menu.
I I'm gonna let you put I'm gonna let you put that big knife down, and then I will shake your hand.
Good morning.
Good to see you.
I'm Kai.
How are you?
I'm doing great.
Gilberto, welcome to uh welcome to the Mercado.
Thank you.
I was just saying it's uh it's a pity I'm not hungry yet.
Really?
Yeah.
Okay.
I just I just ate.
We're gonna have to go long enough to make you hungry.
Stupid move on my part.
Um tell folks who you are and where we are.
So my name is Gilberto Sepina.
I'm the chef and owner of Hol Bosch here at uh Mercado La Paloma in South LA.
Holbosch has been open since 2017.
But Chef Hilberto has been coming to the Mercado way longer than that.
He owns a second restaurant here.
It's called Chichenitsa, originally opened and run by his parents.
Hilberto took over when they retired ten or so years ago.
So my entire cooking career and I think for the first time I'm comfortable calling it a career.
Um you've earned it.
Thank you, thank you.
Uh, has been here in this building at Mercado La Paloma.
Like literally right there at Chichenica with your palace.
I I should have you describe this place.
Yeah.
Give give it give it the radio description for people who can't see it.
So Mercado La Paloma is this beautiful community center in South LA where you walk in and there's six independently owned restaurants.
Uh there's four shops, and then there's nonprofits on the second floor.
And I think Mercado La Paloma is unique in that all of these places truly reflect somebody's story.
Uh Chichenitsa is the culmination of my parents' lifelong dream.
And uh Holbosh is mine.
Tell me about your parents.
My parents.
Um Gilberto and Doña Blanca.
Um, from Yucatan, as as am I.
We emigrated to the United States for the first time in nineteen eighty five.
I was five years old.
And uh like most immigrants, we came because uh things were tough in Mexico.
Uh they were looking for better opportunity for my sister and myself.
And um again, like most immigrants, uh, my parents had lots of different jobs.
My dad focused on culinary jobs and did his passion, which was cook traditional Yucatecan food as a side hustle.
Eventually, that side hustle got my mom involved into it.
My sister and I uh we were the little helpers shredding chicken for tamales for Sunday sales after church.
Wow.
My dad is my only chef mentor that I've ever had.
He was really great at connecting with customers and telling his story of his upbringing, his culinary roots through through food.
And um, I learned how powerful that was, and that's really what we try to do at Holbosch.
I I w I want to get to Holbosch in a minute, but but it occurs to me it's um this is kind of an interview and a story yours anyway about place.
Literally about Yucatan, but also about this place.
Yeah.
Uh Mercado La Paloma.
And and also this place, LA and South LA.
I don't know.
Am I making that up?
No.
No, that's really what the story is about.
Um Mercado La Paloma is instrumental in everything that has happened to me.
It was the only place my dad could open a restaurant.
He didn't choose Mercado La Paloma amongst other options.
This was a project started by nonprofit, Esperanza Community Housing.
And the idea was let's bring people that have something to tell through their food, but don't have the resources to do it, and let's help them out.
So the nonprofit helped us out, my family out with loans, small business training, basic accounting, these things that we didn't have and were outside of the reach of our resources.
They co-signed loans for my dad to buy equipment.
So it's huge, and it formed a really strong relationship, which we continue to carry.
Is is place why you're still here.
I mean you're having amazing success.
You could franchise, you could go to New York, you could go to I mean, almost anywhere, right?
On the strength of your name and what you've built, and yet you're you're still here.
I I I plan on staying at Mercado La Paloma.
I love the idea of Holbosh being born here in this place, and that its entire lifespan be here.
Um that's not to say that I won't take on new projects, but they will not be Holbosh and they will not be in LA.
Let me let me get serious for a second and and ask you about this moment in this country uh and you and your community and the challenges that you're having.
Um that's a freebie, it's a it's a softball.
We're going through a very difficult and uh quite honestly a moment in this country that I I didn't think.
I didn't I I could have never imagined we would go through.
It's heartbreaking to see that the color of your skin, where you come from, the language that you speak, the food that you eat at home, is so divisive.
Um I was under the impression for many years that we lived in a country that was a little more accepting and tolerant of differences and and and that actually embraced it.
And I I think that's the that's always been the beauty of the United States, right?
That you're able to come to this country uh with a dream, and if you do things right and work hard enough, you're able to achieve it.
There's been a systematic change.
Um I mean, I won't shy away from saying it.
This administration is doing things to this country that it's gonna take a really long time.
I think generational to revert.
And it's really heartbreaking.
Are you seeing that in your business?
Do you see fewer people in the door?
Are you having tough time getting people to work for you?
Right?
Because we will work for you.
Come from around here, South LA.
We we in particular here at Hol Bosch, Chichenitza, here at Mercado La Paloma, we're in an extremely fortunate position.
The amount of uh recognition local and and national that Holbosh has had in the last three years specifically has made it so that we have been able to thrive despite everything that's happening.
That being said, the food industry in Los Angeles is suffering greatly.
Taco vendors, small mom and pops, all the way to large award-winning restaurants, they're all having a really hard time.
So let's start with Chichen Itza.
Let's go with the house brand here.
We continued our lap around the Mercado, past a Thai restaurant, a retailer selling, all kinds of sports where Dodgers and USC mostly.
And then this is Komal.
So Chef Fatima and Conrados project.
I mean, just look at it.
It just screen, even the wall looks like corn, right?
I can confirm it does indeed.
All different shades of yellow tile make that happen.
Gilberto was sort of a mentor for Kamal's chef Fatima Juarez.
She worked at both Chichenitza and Holbosh, still supplies their masa, actually.
Kamal opened in 2024.
On the morning we visited, Chefátima had just been nominated for a James Beard Award, actually, for emerging chef.
And now is a threat to us because of the massive amount of success they've had.
Hilberto, we should say, also nominated for his third James Beard Award that morning, this time for Outstanding Chef.
So we're gonna end at Holbosch.
We end at Holbosch.
Uh when I come down here, uh, what should I have?
So I'm not gonna say specific menu item.
When you come here, find a seat at the bar.
Okay, preferably over on the side next to the lobster tanks.
All right.
Not specifically to like have a conversation with the lobsters or anything, but that's where the cevicher's are working.
Sit down and ask them what should I get today.
Okay.
So our menu, we print the menu out daily because it changes daily.
Because that is what I personally enjoy about going to Mexico.
You go to a little coastal town and you eat whatever's being caught.
And uh, but yeah, order the ceviche, whatever fish ceviche is is recommended by cevicheros.
All right, and then ask them one to ten.
How are the sea urchins today?
They say anything over a seven, you have to get it.
Okay.
All right, done deal.
Sure Beto, thank you so much.
I really such a pleasure.
Thank you.
I have to come.
This is now all right.
All right, I'm coming.
Full disclosure, I haven't been back yet, but you know, soon, the new thing, the city of the city of the city of the city of the city of the city of the city of the .
Coming up.
This one was kind of more just plain old bad guys watching trucks.
It's the wild west out there, gang.
But first, let's do the numbers.
Down Industrials up 260 points today.
That's a half percent, 49,501.
The NASDAQ dropped 350 points, one and a half percent, 22,904.
SP 500 down 35.5%, 68 and 82.
The personally owned by Jeff Bezos, Washington Post laid off more than 300 journalists today, as you have heard.
The New York Times had a kind of mixed earnings report today.
Shares down six and three tenths percent.
Amazon, just for the heck of it, slid 2.4% on the day.
Bonds down, yield on the tenure, T note rose, 4.28%.
You're listening to Marketplace.
This is Marketplace.
I'm Kai Rizdall.
Two data points on the way to this next story.
Number one, there's a nonprofit called Global Energy Monitor that reports proposals for new natural gas burning power plants in these United States tripled in 2025 compared to a year earlier.
Data point number two, a report from the energy data company CleanView says much of that increase is because AI data centers are building their own natural gas power plants.
Marketplace's Megan McCarty Carino has more now on the data center electricity demand curve.
Enough to power every home in America and about a hundred million more, according to research analyst Jenny Martos at Global Energy Monitor.
She tracks projects that have been announced and those already under construction.
Big tech is spending hundreds of billions of dollars to build out the infrastructure of AI, and they want it up and running ASAP.
So natural gas has been like the only real solution in the near term.
He says getting energy from a local utility has been getting harder with up to a five year wait.
So a lot of data centers are going behind the meter, building their own power plants on site.
Hyperscalers are investing in clean energy solutions like small modular nuclear reactors.
That's seven, ten, twelve years out.
Natural gas generation can fire up in a fraction of that time.
That is, if you can get your hands on the required turbine.
The lead time has exploded to as long as five or seven years.
Michael Thomas is the founder of CleanView Market Intelligence.
He analyzed permits and site plans for dozens of data center generation facilities.
Most of the equipment was natural gas powered, and many developers are getting creative to get online as quickly as possible.
We found plans of data center developers that are gonna strap gas engines and turbines to semi-trucks.
We found plans to use turbines that are built for jet engines and for uh, in some cases, warships, uh, in other cases, cruise ships.
These are less efficient means of generating power from a fuel that is not the cleanest at baseline, says Emily Grubert, associate professor of sustainable energy policy at the University of Notre Dame.
It is less greenhouse gas intensive than coal, but it's still greenhouse gas intensive enough that if we need to take climate seriously, it needs to be phased out as well.
She says even if data centers switch to clean energy in the future, someone's going to buy up that surplus natural gas capacity for decades.
I'm Megan McCarty Carino for Marketplace.
Retail theft, shrinkage, as they call it in the trade, comes in many forms.
A smash and grab, perhaps, a little sleight of hand at the self-checkout.
But the crime that's perhaps affecting companies the most right now happens before any products make it to store shelves.
Cargo theft.
People stealing pallets off trucks or even whole trucks full of stuff, anything from TVs to lobsters.
As marketplaces Kristen Schwab reports, the American Trucking Association says last year was likely the biggest for cargo theft on record.
The cargo was loaded in Indiana, Kentucky, and Ohio.
Trucks full of Oculus headsets, bow speakers, and products from Bath and Bodyworks destined for warehouses all over the country.
But they never made it there.
When drivers took breaks to eat, sleep, or refuel, thieves swooped in.
They stole the trailer, obviously changed the identifying markers on the trailer.
And drove the goods down to Florida to be resold.
Timothy O'Malley, a special agent at the FBI in Indianapolis, says over 18 months, a group of men staked out warehouses and tracked drivers.
In total, they swiped more than a dozen trucks.
Now, these were not like the dramatic heists you see on TV.
O'Malley says cargo thefts usually aren't.
No ski masks, no weapons.
This one was kind of more just plain old bad guys watching trucks and then waiting for an opportunity to steal those loads.
Cargo theft increased more than 90% between 2021 and 24.
And Scott Cornell, chair of the Transported Asset Protection Association, says the nature of the crime has changed.
It went from fathers, sons, uncles, cousins, brothers, all making up the crew, to now massive international crime rings.
As logistics technology has gotten better, so have thieves.
And every time goods exchange hands, it creates an opportunity to steal.
It's why cargo theft is most common near major logistics hubs, places with ports and warehouses like California and Texas.
And thieves, they steal really anything and everything, from pharmaceuticals to livestock.
Cornell says the most popular category is food.
Easier to sell and easier to hide.
Most stolen goods end up on third-party selling sites, think eBay and Facebook Marketplace, or they get shipped overseas.
Often the big boss is somewhere abroad operating online.
David Mitsui, director of risk and compliance at Freight Brokerage Total Quality Logistics, says this kind of theft, called strategic theft, is becoming more common.
We had a carrier.
It was a legitimate carrier that we contracted for a load.
The driver was hired to move a truck full of copper, but while on the road, he got an email from someone he thought was from Total Quality Logistics.
They said, Hey, I know that this load is supposed to be going to X.
Instead of delivering there, we're gonna have you take it to this warehouse that's really close to where you are right now.
The copper was eventually recovered, but even in this best case type of scenario, there are consequences.
Baked into the price of, say, a warm vanilla sugar candle from Bath Body Works.
I'm Kristen Schwab for Marketplace.
This final note on the way out today, a punctuation mark of sorts on a lot of the AI coverage that has been out there lately.
Google reported quarterly profits today, did fine, made billions of dollars, lather, rinse, repeat, you know the drill.
Here, though, is the kicker.
The company said it is going to double its capital expenditures this year, the overwhelming majority of which is going to AI.
They're going to double them to somewhere between 175 and 185 billion American dollars.
Our media production team includes Brian Allison, John Focky, Montana Johnson, Drew Josset, Gary O'Keefe, and Charlton Thorpe.
I'm Kyle Risdall.
We will see you tomorrow, everybody.