Creating Resilience

Data Center Growth Has Economic Ripple Effects

mei 23, 2024 3 minuut Read

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Digital infrastructure has never been more important to providing reliable connectivity for business, commerce and communication. Development of new data center facilities is not only accommodating advanced technologies like artificial intelligence but is also contributing to widespread economic growth.

Data-center-related jobs have increased by 20% nationwide to 3.5 million from 2.9 million between 2017 and 2021, far exceeding the 2% rise in overall U.S. employment, according to accounting firm PwC. Each direct job in the U.S. data center industry helps to create 7.4 ancillary jobs on average throughout the U.S. economy.

On a local and state level, sales and property tax revenues are being fortified by data center growth. In a typical data center, sizable investment in computer hardware and software is required, as well as ongoing maintenance of this equipment. Three U.S. states in particular—Virginia, Nebraska and Ohio—illustrate the outsized impact that data centers are having on tax generation.

Virginia

In Northern Virginia’s Loudoun County, tax revenue from computer equipment purchases for data centers surged by 170% to $582 million in 2023 from $215 million in 2021—two and a half times the tax revenue from motor vehicle sales. This boost in revenue has provided significant funding for public education, infrastructure, public health initiatives, capital improvement programs and parks and recreation amenities.

Figure 1: Northern Virginia Data Center Inventory

Figure 1 bar chart

Source: CBRE Research, CBRE Data Center Solutions, H2 2023.

Nebraska

Dozens of data centers have been developed statewide for cloud-service and third-party colocation providers. Mangum Economics estimates there were 490 people working full-time in Nebraska data centers and over 1,500 construction workers building new data centers in 2022—the combined tax revenue from which totaled $1.3 billion. CBRE estimates that annual property taxes from a data center facility in Nebraska can be 110 times greater than those from agricultural land.

Ohio

The growth of data centers across the state has driven local economic development and job creation. Large-scale data center development in Ohio has generated thousands of construction, operations and maintenance jobs and contributed billions of dollars to the state's GDP. Beyond direct employment, data centers create a network of support positions in telecommunications, software development, facilities management and electricity generation. Data centers also contribute to educational programs, including professional training to meet the high demand for tech talent.

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