{"691073":{"#nid":"691073","#data":{"type":"news","title":"Data Centers Are Booming. Who Benefits?","body":[{"value":"\u003Cp\u003EArtificial intelligence is reshaping how businesses operate and driving a historic surge in data center construction across the United States. These sprawling facilities, sometimes spanning more than 1,000 acres, represent one of the largest waves of capital investment in American history.\u003Cbr\u003E\u0026nbsp;\u003C\/p\u003E\u003Cp\u003EFor communities across the country, this growth hits close to home, and not without controversy. What do data centers actually deliver for the local economies that host them?\u003Cbr\u003E\u0026nbsp;\u003C\/p\u003E\u003Cp\u003E\u003Ca href=\u0022https:\/\/papers.ssrn.com\/sol3\/papers.cfm?abstract_id=6497238\u0022\u003ENew research\u003C\/a\u003E\u0026nbsp;from\u0026nbsp;\u003Ca href=\u0022https:\/\/www.scheller.gatech.edu\/directory\/faculty\/yue\/index.html?_gl=1*22ff1a*_up*MQ..*_ga*NjU1MDU4NDM5LjE3ODM2MTc4Nzg.*_ga_8XJDVR2ZKP*czE3ODM2MTc4NzckbzEkZzEkdDE3ODM2MTc4ODEkajU2JGwwJGgxNzkwMjU1NjAy\u0022\u003EDaniel Yue\u003C\/a\u003E, assistant professor of Information Technology Management at Georgia Tech\u2019s Scheller College of Business, and his co-author,\u0026nbsp;\u003Ca href=\u0022https:\/\/www.scheller.gatech.edu\/directory\/faculty\/zeng\/index.html?_gl=1*1771i5w*_up*MQ..*_ga*MTM1MDIxNjE3NC4xNzgzNjE4MTk5*_ga_8XJDVR2ZKP*czE3ODM2MTgxOTkkbzEkZzAkdDE3ODM2MTgxOTkkajYwJGwwJGgxMTY0MTA2MjA4\u0022\u003EYiyang Zeng\u003C\/a\u003E, examines how data center openings affect local jobs, wages, business activity, and electricity prices. Their findings suggest that geography plays a decisive role in whether communities see meaningful economic gains.\u003Cbr\u003E\u0026nbsp;\u003C\/p\u003E\u003Cp\u003E\u201cEnormous amounts of capital are flowing into specific communities, much of it tied to new construction, while rigorous evidence on the local benefits of these facilities has been thin,\u201d said Yue. \u201cCommunity pushback has organized rapidly across the country. Our paper begins to fill that gap by providing new evidence using detailed, facility-level data paired with county-level economic indicators.\u201d\u003C\/p\u003E\u003Cp\u003E\u003Cstrong\u003EA Historic Investment Wave\u003C\/strong\u003E\u003C\/p\u003E\u003Cp\u003EThere are more than 2,500 data centers, either active or under construction, across the United States. Individual hyperscale facilities often cost more than $1 billion to construct and can consume as much electricity as a small city. Is it all worth it?\u003C\/p\u003E\u003Cp\u003EOn average, Yue and Zeng found that when a data center opens, the host county sees a measurable lift: Employment rises by about 3.5%, wages by 5%, business establishments by nearly 5%, and household income by about 2%. Building permits also increase sharply, reflecting construction activity tied to new facilities.\u003C\/p\u003E\u003Cp\u003EThese are real, economically meaningful gains. But Yue and Zeng discovered that these gains are much smaller than what might be expected from a large investment. And they\u2019re not evenly distributed.\u003C\/p\u003E\u003Cp\u003E\u003Cstrong\u003EWhy Metro Areas Benefit More\u003C\/strong\u003E\u003C\/p\u003E\u003Cp\u003EThe researchers\u2019 clearest finding is that metropolitan areas capture most of the economic benefits from data centers, while rural areas see far fewer spillover effects. While metro counties saw increases in employment and new business growth, non-metro counties saw no measurable gains.\u003C\/p\u003E\u003Cp\u003EThe reason comes down to what economists call \u201cagglomeration,\u201d or economic density.\u003C\/p\u003E\u003Cp\u003EData centers don\u2019t operate in isolation. They rely on construction contractors, engineers, equipment suppliers, professional services, and a skilled workforce. Those connections are far easier to build in places that already have deep labor markets and established business networks.\u003C\/p\u003E\u003Cp\u003EMetropolitan areas are well-positioned to absorb the indirect spending that data centers generate. High-wage technical employees support restaurants, retail, and local services. Suppliers and contractors can scale up quickly. These spillover effects amplify the impact of the initial investment.\u003C\/p\u003E\u003Cp\u003EIn rural areas, that amplification is much harder to achieve. Facilities tend to employ relatively few permanent workers \u2014 often fewer than 100 \u2014 and many specialized services are imported from outside the county. As a result, the broader economic ripple never materializes.\u003C\/p\u003E\u003Cp\u003EThat doesn\u2019t mean rural communities see no benefit at all. The research finds a small but real drop in unemployment rates in non-metro counties, and local governments may still gain tax revenue or infrastructure investments. But the sweeping job and wage growth often promised during local recruitment efforts will not likely arrive on its own.\u003C\/p\u003E\u003Cp\u003E\u201cLocation, not facility size, determines whether the local benefits show up,\u201d Yue said.\u003C\/p\u003E\u003Cp\u003E\u003Cstrong\u003EThe Hidden Cost: Electricity Prices\u003C\/strong\u003E\u003C\/p\u003E\u003Cp\u003EYue and Zeng\u2019s research also uncovers an important trade-off. Data centers use a lot of electricity. A single large facility can use as much power as roughly 80,000 homes. In areas where the researchers can cleanly measure price effects, electricity prices rise by about 5% after a data center enters.\u003C\/p\u003E\u003Cp\u003E\u201cWhen the benefits to communities are small, even downsides like higher electricity prices that strain infrastructure will be felt by locals,\u201d Yue shared.\u003C\/p\u003E\u003Cp\u003EWho pays for the increased cost of electricity isn\u2019t straightforward. Yue and Zeng\u2019s research suggests communities should ask specific questions about who pays for new infrastructure and how those costs will be distributed. Local utility companies divide costs differently among homeowners, businesses, and large industrial users, including data centers. Because cost-sharing systems vary by state, each data center development is unique.\u003C\/p\u003E\u003Cp\u003E\u003Cstrong\u003EWhat Communities Should Consider\u003C\/strong\u003E\u003C\/p\u003E\u003Cp\u003EAs states and cities work to attract or push back against data center construction, Yue and Zeng hope their research will encourage more evidence-based decision-making.\u003C\/p\u003E\u003Cp\u003EFor metro areas with strong labor markets and dense business ecosystems, data centers can deliver meaningful, though not transformative, economic gains. For rural communities, the positive impact is more complicated.\u003C\/p\u003E\u003Cp\u003E\u201cIn 10 years, communities will likely wish they had pressed harder on the quality of the decision itself, including whether the debate was evidence-based, whether their local economy was equipped to capture the gains, and whether the fine print aligned with residents\u0027 long-term interests,\u201d Yue said. \u201cIt\u2019s vital that communities look past flashy, headline incentive packages and focus on the details: tax abatement structures, electricity tariff arrangements, and who ultimately pays for infrastructure upgrades.\u201d\u003C\/p\u003E\u003Cp\u003EAs data centers continue to dot the American landscape, understanding where they create shared value \u2014 and where they don\u2019t \u2014 will be critical for community leaders and policymakers alike.\u003Cbr\u003E\u0026nbsp;\u003Cbr\u003E\u003Ca href=\u0022https:\/\/papers.ssrn.com\/sol3\/papers.cfm?abstract_id=6497238\u0022\u003ERead More: The Local Economic Effects of Data Center Entry\u003C\/a\u003E\u003C\/p\u003E","summary":"","format":"limited_html"}],"field_subtitle":"","field_summary":[{"value":"\u003Cp\u003EAs data centers expand across the U.S., new research by Daniel Yue, assistant professor of IT management, and his co-author, Yiyang Zeng, reveals that their economic benefits are real but uneven, shaped largely by local economic conditions and geography.\u003C\/p\u003E","format":"limited_html"}],"field_summary_sentence":[{"value":"Data centers continue to expand across the U.S. Do the communities nearby really benefit?"}],"uid":"36730","created_gmt":"2026-07-09 17:25:59","changed_gmt":"2026-07-09 17:34:51","author":"klowe36","boilerplate_text":"","field_publication":"","field_article_url":"","location":"Atlanta, GA","dateline":{"date":"2026-07-09T00:00:00-04:00","iso_date":"2026-07-09T00:00:00-04:00","tz":"America\/New_York"},"extras":[],"hg_media":{"680584":{"id":"680584","type":"image","title":"The economic impact of data centers","body":"\u003Cp\u003ELead story image for Scheller News story \u0022Data Centers Are Booming. Who Benefits?\u0022 A hazy photo of an electronic board, possibly an internal image of a data center.\u003C\/p\u003E","created":"1783617674","gmt_created":"2026-07-09 17:21:14","changed":"1783617834","gmt_changed":"2026-07-09 17:23:54","alt":"A hazy photo of an electronic board, possibly an internal image of a data center.","file":{"fid":"264862","name":"data-center.jpg","image_path":"\/sites\/default\/files\/2026\/07\/09\/data-center.jpg","image_full_path":"http:\/\/hg.gatech.edu\/\/sites\/default\/files\/2026\/07\/09\/data-center.jpg","mime":"image\/jpeg","size":117567,"path_740":"http:\/\/hg.gatech.edu\/sites\/default\/files\/styles\/740xx_scale\/public\/2026\/07\/09\/data-center.jpg?itok=hj8qj4-z"}}},"media_ids":["680584"],"related_links":[{"url":"https:\/\/www.scheller.gatech.edu\/news\/2026\/data-centers-are-booming-who-benefits.html?_gl=1*3nsm4t*_up*MQ..*_ga*NjU1MDU4NDM5LjE3ODM2MTc4Nzg.*_ga_8XJDVR2ZKP*czE3ODM2MTc4NzckbzEkZzEkdDE3ODM2MTc4ODAkajU3JGwwJGgxNzkwMjU1NjAy","title":"Read More"}],"groups":[{"id":"1188","name":"Research Horizons"}],"categories":[{"id":"194606","name":"Artificial Intelligence"},{"id":"139","name":"Business"},{"id":"135","name":"Research"}],"keywords":[{"id":"168537","name":"Data Center"},{"id":"110561","name":"data centers"},{"id":"336","name":"information technology"},{"id":"602","name":"economics"},{"id":"187915","name":"go-researchnews"}],"core_research_areas":[],"news_room_topics":[],"event_categories":[],"invited_audience":[],"affiliations":[],"classification":[],"areas_of_expertise":[],"news_and_recent_appearances":[],"phone":[],"contact":[],"email":["kristin.lowe@scheller.gatech.edu"],"slides":[],"orientation":[],"userdata":""}}}