天美传媒

Employment is moderate and housing prices slump when data centers come to town.

With technology companies expected to , many local governments are attempting to woo such investments with tax breaks and other incentives, in the hopes of creating jobs, raising fiscal revenue and fueling regional economic development.

But backlash against the projects is increasingly fierce 鈥� and politicized. Faced with the prospect of farmland and other natural spaces being converted into vast tracts of windowless warehouse-like structures, opponents warn of massive energy and water consumption, strains on other infrastructure and industrial-strength noise pollution.

滨贰厂贰鈥檚 Carles Vergara and Christoph Loch contribute to the debate over the net benefits of data centers to local communities with two pieces of research measuring the impact on employment and housing markets, with complementary information on indicators such as electricity prices and municipal bond yields.

Evaluating data centers presents unique challenges. Though hugely capital-intensive investments, they require relatively few direct employees once short-term construction workers have finished building them. The places where they choose to locate, normally with comparatively low-cost power and available land, may already be on a path to growth. In addition, facilities are drastically different in size, from hyperscale campuses to micro sites.

Still, what emerges from the research will likely disappoint the most gung-ho politicians. , though not immediately and only in a narrow range of sectors, according to the Vergara research. , the Loch study shows, while electricity prices and consumption climb. And neither study detects widespread economic benefits to local economies.

How data centers create employment

In a working paper published by the MIT Center for Real Estate Research, Vergara and coauthors examine 1,584 U.S. data centers between 2000 and 2023, decades in which developments, once concentrated in California and the Northeast, spread across the country.

Since data centers require few workers to operate, tracing their effect on the job market involves examining local suppliers of services such as maintenance and security. Strong demand for those kinds of jobs may then have a knock-on effect on local restaurants, retail and other services. The centers, connected to fiber networks and power infrastructure, could also potentially serve as magnets for other companies to set up shop nearby, which could conceivably generate jobs.

But do they? In general, the employment benefits are limited to the industries that supply the centers, and only accrue after two years. The research finds that:

• For the first two years after a data center becomes operational, local non-construction employment changes little.
• Around the third year, the response becomes more noticeable. From three to five years after opening, counties with data centers have, on average, about 1,000-1,300 more non-construction jobs than control counties. The delayed response may be due to the time it takes for local companies to respond to new demand, for workers to relocate gradually and for more capacity to be added to initial investments.
• By year five, the employment impact is approximately 2.74 jobs created per megawatt of installed capacity.

The employment gains are concentrated in two sectors:

• transportation and warehousing.
• professional and technical services.

In contrast, consumer sectors, such as local retail or restaurants, see little new hiring. Data centers generate jobs closely linked to their specific needs, rather than serving as broad-based consumption multipliers.

Turning to whether data centers draw new businesses to the area, the research finds that follow-on investment comes mostly from incumbents expanding their own campuses, rather than from new and varied entrants arriving on the scene.