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With a boon in AI data center growth in the U.S. comes the prospect of thousands of jobs, right? Not necessarily.
Although it requires thousands of workers to build these facilities, “The reality is data centers just don’t employ that many people,’’ wrote Tom Dotan, a reporter for The Wall Street Journal, wrote on LinkedIn about his related WSJ article.
Fact vs. fiction about full-time data center jobs
Data centers have been touted by politicians and business leaders as a new avenue for employment. When President Trump discussed OpenAI’s Stargate AI venture during a recent press conference, he said that more than 100,000 new jobs would be created “almost immediately.” OpenAI echoed that in a blog post, saying Stargate would “create hundreds of thousands of American jobs.”
However, Dotan cited a one million square foot facility in Abilene, TX that OpenAI is planning to use for its Stargate AI venture that will employ 1,500 people to build it but is projected to employ only 100 people full time. “That’s one-fifth the number of people who will be working in a nearby cheese packing plant that is a fraction of the size,’’ Dotan wrote.
“Data centers are very labor-intensive to build, but not as labor-intensive to operate,” according to Jim Grice, a real estate and project finance attorney who focuses on data centers, as quoted in the WSJ article.
Synergy Research Group Chief Analyst John Dinsdale said in Dotan’s WSJ article that, while data centers can employ more than 1,000 people in the several months or years it takes to build them, it is rare for them to need more than 100-200 once they open.
Regional economic impact of these data centers is limited
These sentiments are echoed by Good Jobs First, a Washington, D.C.-based nonprofit that tracks the use of state and local economic development subsidies. “Data centers require large amounts of capital investment, but, unlike manufacturing projects, they create few jobs,’’ the organization wrote in a blog post.
In addition, “Besides electricity and water, data centers buy very little from local communities, so their economic impact on a region is limited,’’ Good Jobs First said.
OpenAI’s estimate of the total jobs resulting from Stargate includes ones created indirectly by company and employee spending in communities, according to a company spokeswoman.