Data center proposals are often flush with the lure of economic benefits, promising thousands of jobs, new tax revenue, and major investments in local infrastructure while pledging to limit environmental impacts. Yet while many projects generate large workforces during construction, the number of permanent operational jobs is often far smaller, raising questions about how communities should weigh the full economic benefits the data centers bring.
Employment remains one of the industry's most powerful selling points, particularly as many communities face economic uncertainty and concerns about layoffs in other industries, such as in manufacturing. But a closer look at data center projects shows that the job figures highlighted in development proposals often combine temporary construction positions with a much smaller number of permanent operational roles. In some cases, a facility expected to support thousands of construction jobs may employ fewer than 10 percent of that number once it begins operating, a distinction that is not always apparent in public announcements. As communities weigh new data center proposals, understanding the difference between short-term and long-term employment has become an increasingly important part of assessing their overall economic impact.
Yet measuring the economic impact of a data center is not as simple as comparing construction jobs with permanent payrolls. Supporters argue that the projects generate tax revenue, business for local contractors, and demand for new energy infrastructure, while critics question whether those benefits justify the public incentives and resource demands many facilities require.
How Many Jobs Do Data Centers Usually Create?
Many data center projects propose thousands of jobs. While staffing levels vary by size and function, large hyperscale data centers often employ dozens to a few hundred workers once operational, despite requiring thousands of workers during construction.
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For example, a Meta data center project currently under construction in El Paso, Texas, says that more than 4,000 people will be employed during the peak construction phase of the project, part of a $10 billion investment in the community. However, long-term operation estimates paint a different picture. More than 300 employees are expected to run the facility once it has been built, and while that figure still represents a significant long-term economic contribution, it is less than 10 percent of the major influx of jobs generated during the site's construction.
Newsweek reached out to Meta by email for comment.
In northwest Louisiana, Amazon recently announced it was expanding its planned data center investment in Caddo and Bossier Parishes to a third planned campus in Shreveport, increasing its investment from $12 billion to $18 billion. The announcement said the project would create 2,250 construction jobs and 750 full-time positions. Earlier this year, Amazon also said it planned to invest $25 billion in Mississippi, "with plans to create 2,000 high-skilled jobs across all our Mississippi data center operations," the announcement said.
“Last year alone our data center investments supported more than 270,000 jobs across the U.S. economy, demonstrating the broader positive economic impact we bring to the places where we invest," Roger Wehner, vice president of economic development for Amazon's Data Center Infrastructure, told Newsweek on Friday. "This includes construction workers who build the facilities, technicians who run operations, manufacturers and suppliers who equip it, and local businesses that support the growing workforce. Beyond this, we contribute meaningfully to the communities in which we invest through the tax revenue that funds schools and public safety, the contributions we’re making to upgrade the grid and water infrastructure, and our education and community programs."
In June, Microsoft announced a new data center in Pecos, Texas, that would expand its global capacity by 2 gigawatts and is expected to support over 6,000 construction jobs at peak build-out.
"Microsoft is grateful for the opportunity to become part of the Pecos and Reeves County community," a Microsoft spokesperson told Newsweek on Friday. "While we're still in the early stages, we expect this project to create thousands of jobs during construction and hundreds of long-term operational roles once the campus is running. We look to hire locally wherever we can, and we're working with local leaders, schools, and workforce partners to build career pathways for residents."
Also in June, Google announced a $1.5 billion investment to expand its data center campus in Jackson County, Alabama. The campus has operated since 2019 on a repurposed coal plant site. The expansion will bring in over 1,000 contract jobs, the announcement said, and also will “build on hundreds of full time jobs the Jackson County data center already supports,” although an exact number of operational jobs created by the expansion was not provided.
Newsweek reached out to Google by email for comment about the company’s data center initiatives. A spokesperson told Newsweek they didn’t have enough time to answer the questions about Google’s data centers and instead shared a document detailing the approach, which outlines jobs involved in data center creation. The document said Google hires locally first, supports “training, apprenticeships, and entrepreneurship” in the communities where it operates, and partners “on long-term skilling programs with major labor organizations.”
What Kind of Jobs Do Data Centers Typically Create?
During a data center’s construction, which can last for years, tradespeople will dominate the workforce, Darrell West, a senior fellow in governance studies at Brookings Institution, told Newsweek.
“Many skilled tradespeople are hired for data center construction such as electricians, plumbers, and HVAC specialists, among others,” West told Newsweek.
That demographic shifts once the center is up and running. Jobs needed to operate a data center include network operators, cybersecurity people, maintenance individuals, and security officers.
In the best case scenario, the employees for the construction and operations of a data center will come from the local community, West said, but that isn’t always the case.
“Companies like to hire local because it helps them build good will with area communities,” West said. “But if they cannot find the workers they need, they will look outside the local area.”
Data centers currently being built in the U.S. are providing many more jobs than those built years ago, West said, because the facilities are much larger with a more impressive scope. Still, the largest economic benefit posed by data centers is not the boom to a local community’s workforce, but the generated tax revenue.
“Towns can earn a lot in sales taxes from data centers as long as they don't have tax abatement clauses providing tax breaks for companies,” West said.
How the US Economy Is Changing With Data Center Construction
While there is often a stark difference between the number of workers needed to build a data center and those required to operate one, federal labor projections suggest the industry's economic impacts extend beyond the facilities themselves. As AI adoption accelerates and demand for data center infrastructure grows, the U.S. Bureau of Labor Statistics (BLS) expects electricity consumption to rise as well, according to a report published in August.
The BLS projects that four of the nation's 10 fastest-growing industries will see employment growth driven in large part by increasing demand for electricity, including demand associated with AI and data centers. Although those power-generation industries remain relatively small, BLS estimates they will add about 35,800 jobs through 2035, highlighting how thousands of jobs tied to data center expansion may occur outside the facilities' own payrolls.
The impact extends beyond jobs needed to support the electricity demand, the BLS report showed. Employment growth is also expected for computing infrastructure providers, data processing, web hosting, and similar industries.
“As a result, this industry is projected to grow 25.1 percent and add 120,400 new jobs over the projections period,” the report said. “Other electrical equipment and component manufacturing, which includes production of batteries used for energy storage and in electric vehicles, is projected to grow 25.9 percent from 2025 to 2035. Rising demand for fiber optic cables, used for the transmission of data across AI infrastructure and in telecommunications infrastructure, is also expected to contribute to strong employment growth in this industry.”
Do the Costs of Building Data Centers Outweigh the Benefits?
Despite the economic benefits touted by companies seeking to build data centers across the United States, lawmakers and community members have increasingly pushed back against the wave of proposed projects, citing concerns about strain on local electric grids, water use, environmental impacts and quality-of-life issues for nearby residents. Critics argue that while data centers can bring construction jobs and tax revenue, they can also place significant demands on power and natural resources, particularly as electricity consumption rises alongside the growth of artificial intelligence.
Those concerns have prompted some states to pause or reassess new data center development. In Texas, Governor Greg Abbott temporarily halted approvals for new data centers seeking to connect to the state's electric grid while officials conducted an audit of pending projects and their potential impact on electricity reliability. In New York, Governor Kathy Hochul announced a moratorium on new hyperscale data center proposals in July, saying the state needed additional time to study the industry's potential effects on utility costs, environmental resources and grid capacity.
The moves reflect a growing debate playing out across the country as officials weigh the economic benefits of attracting data center investment against concerns over infrastructure, energy demand and local community impacts.
Data center proposals vary widely from one community to the next, as do the concerns they raise. Whether the economic benefits ultimately outweigh the costs remains an open question, and one that local officials and residents are increasingly weighing as they consider new projects.
Contact Newsweek editors on this story: Jenna deJong and Emma Lee-Sang