Data Centers
- Russell Withers
- 2 days ago
- 2 min read
There is no challenge presented by data centers that cannot be addressed by good policy.
House Committee on State Affairs
Texas should welcome new industry, and data centers are no exception. They create jobs, attract large sums of capital, and produce a host of direct and indirect economic benefits.
In terms of jobs, data centers require construction, which includes a broad range of contracting expertise and labor. Like any construction, they require plumbers, steel workers, concrete contractors, HVAC contractors, electricians, roofers, and more. All of those professionals need materials, and the state’s economy benefits from this activity.
Virginia—the nation’s leading state for data centers—commissioned a 2024 report on the impacts of data centers. That report found considerable positive economic impacts, but it emphasized the greatest benefit during the initial construction phase. Indeed:
Data centers provide positive benefits to Virginia’s economy mostly because of the industry’s substantial capital investment. The primary benefit comes from the initial construction of data centers. Most construction spending likely remains in the state economy because much of it goes to Virginia-based businesses providing construction materials and services.
Like any new facility, the construction phase reaches a conclusion and the next phase is one of planned, ongoing operations. While construction can take 12-18 months and employ approximately 1,500 workers at peak, the ongoing operations—like that of many industries—require less manpower. The ongoing operations of a standard 250,000 square foot data center can employ roughly 50 employees, and many of those jobs are high paying.
While the ongoing operations of a data center require fewer employees than the construction phase, that should not be viewed as a negative. Every industry has its demands and requirements that it knows must be met. To argue that a data center does not directly provide jobs to thousands of people in an ongoing basis would amount to a criticism of many industries in Texas. Indeed, the Texas Legislature recently made a $1.5 billion commitment to the film industry with economic incentives for projects that are temporary by their very nature. In contrast, a data center is a long term proposition.
Read the full testimony in the link above.
