{"691396":{"#nid":"691396","#data":{"type":"news","title":"Why Better\u2011Off Cities and Towns See More Benefits From Data Centers Than Rural\u00a0Regions","body":[{"value":"\u003Cdiv class=\u0022theconversation-article-body\u0022\u003E\u003Cp\u003EThe fierce backlash against data centers shows no sign of easing up.\u003C\/p\u003E\u003Cp\u003ESince early 2024, more than 1,200 public actions \u2013 including zoning fights, public campaigns and temporary moratoriums \u2013 have been logged by the \u003Ca href=\u0022https:\/\/datacentertracker.org\/\u0022\u003EData Center Tracker\u003C\/a\u003E, a public U.S. database of community responses to data center site selection. \u003Ca href=\u0022https:\/\/www.nytimes.com\/2026\/03\/26\/business\/economy\/ai-data-centers-construction-local-opposition.html\u0022\u003EAmong the concerns\u003C\/a\u003E, grid capacity, water use and transparency around siting appear most often.\u003C\/p\u003E\u003Cp\u003EThis momentum is leading to political action. In Maine, lawmakers \u003Ca href=\u0022https:\/\/www.wsj.com\/us-news\/maine-data-center-ban-e768fb18\u0022\u003Epassed a contested bill in spring 2026\u003C\/a\u003E that would have imposed the nation\u2019s first statewide moratorium on new data centers. Gov. Janet Mills \u003Ca href=\u0022https:\/\/www.maine.gov\/governor\/mills\/news\/governor-mills-announces-decision-ld-307-2026-04-24\u0022\u003Eultimately vetoed the measure\u003C\/a\u003E on grounds that it would scuttle a US$550 million conversion of the closed Androscoggin Mill in the town of Jay into a data center.\u003C\/p\u003E\u003Cp\u003EBut in a nod to the political climate, Mills said she supported in principle a pause in development and signed separate legislation barring state tax incentives going to data centers. She also pledged to create a council to study the industry statewide.\u003C\/p\u003E\u003Cp\u003EMaine\u2019s dispute shows how statewide decisions on whether to promote or curb data centers can come down to one local case. It was no isolated example: Up to \u003Ca href=\u0022https:\/\/www.wsj.com\/us-news\/maine-data-center-ban-e768fb18\u0022\u003E10 other states are considering\u003C\/a\u003E similar measures to contain their expansion.\u003C\/p\u003E\u003Cp\u003EBut lawmakers across the country still lack clear evidence on whether new data centers can boost the economies of the communities hosting them.\u003C\/p\u003E\u003Cp\u003EAs scholars of how \u003Ca href=\u0022https:\/\/scholar.google.com\/citations?user=n1mL35QAAAAJ\u0026amp;hl=en\u0022\u003Etechnological change and innovation\u003C\/a\u003E shape \u003Ca href=\u0022https:\/\/www.scheller.gatech.edu\/directory\/faculty\/zeng\/index.html\u0022\u003Ebusiness strategy\u003C\/a\u003E, \u003Ca href=\u0022https:\/\/www.scheller.gatech.edu\/news\/2026\/data-centers-are-booming-who-benefits.html\u0022\u003Ewe set out\u003C\/a\u003E to produce rigorous research so that policymakers can make better decisions for their communities despite the emotions on both sides.\u003C\/p\u003E\u003Cp\u003E\u003Ca href=\u0022http:\/\/dx.doi.org\/10.2139\/ssrn.6497238\u0022\u003EWhat we found\u003C\/a\u003E was that data center development can boost growth and jobs \u2013 but these benefits are most pronounced when the local economy is more urban and developed. In fact, it turns out that the local economy around a data center matters more than the facility itself.\u003C\/p\u003E\u003Ch2\u003ETesting the Data Center Promise\u003C\/h2\u003E\u003Cp\u003EFor years, state and local governments \u003Ca href=\u0022https:\/\/www.ncsl.org\/fiscal\/subsidizing-servers-how-states-are-competing-to-attract-data-centers\u0022\u003Ehave courted data center projects\u003C\/a\u003E with property tax abatements, sales tax exemptions and other incentives. Some jurisdictions still compete aggressively, but more and more are turning the other way, \u003Ca href=\u0022https:\/\/goodjobsfirst.org\/data-center-moratorium-bills-are-spreading-in-2026\/\u0022\u003Eblocking tens of billions of dollars\u003C\/a\u003E in proposed investments.\u003C\/p\u003E\u003Cp\u003E\u003Ca href=\u0022http:\/\/dx.doi.org\/10.2139\/ssrn.6497238\u0022\u003ETo understand the full economic impact\u003C\/a\u003E, we combined records of when the centers began operating with data on local economic activity. We then compared how those economic outcomes changed before and after a county\u2019s first data center opened relative to similar counties without data centers.\u003C\/p\u003E\u003Cp\u003EOverall, we found that data centers do boost growth. In the first three years after one opened, local employment rose on average by about 0.9%, wages by 1.1%, and the number of business establishments by 1%. Longer term, those effects grew to roughly 3.5%, 5% and 4.7%, respectively. Household income and building permits, meanwhile, increased by 1.9% and 16.1%, respectively. All of these gains accumulate gradually, rather than at once.\u003C\/p\u003E\u003Cp\u003EBut the average effects mask an important pattern. Data centers are more likely to juice the economy when there\u2019s a cluster of labor and capital already nearby, such as construction contractors, equipment suppliers, professional services and a skilled workforce.\u003C\/p\u003E\u003Cp\u003EIn metropolitan counties, where that cluster of labor and capital is thicker, employment jumped by about 4.1%, while wages increased by 5.5%. In less populous counties, by contrast, job and wage spillovers were negligible. This suggests that the host community\u2019s level of economic development matters more than the size of the project.\u003C\/p\u003E\u003Cp\u003EThat said, other factors also affected local economic effects from one area to the next. Facilities operated by major tech companies, for example, raised local wages more than smaller companies. In addition, counties that attracted multiple data centers within five years of the first showed larger cumulative gains than counties with a single, isolated facility.\u003C\/p\u003E\u003Cfigure class=\u0022align-center\u0022\u003E\u003Cp\u003E\u003Cimg alt=\u0022Anti-data center protestors, holding signs, are escorted out of a Georgia Public Service Commission meeting in Atlanta.\u0022 src=\u0022https:\/\/images.theconversation.com\/files\/747019\/original\/file-20260709-71-o4kknq.jpg?ixlib=rb-4.1.1\u0026amp;q=45\u0026amp;auto=format\u0026amp;w=754\u0026amp;fit=clip\u0022 srcset=\u0022https:\/\/images.theconversation.com\/files\/747019\/original\/file-20260709-71-o4kknq.jpg?ixlib=rb-4.1.1\u0026amp;q=45\u0026amp;auto=format\u0026amp;w=600\u0026amp;h=450\u0026amp;fit=crop\u0026amp;dpr=1 600w, https:\/\/images.theconversation.com\/files\/747019\/original\/file-20260709-71-o4kknq.jpg?ixlib=rb-4.1.1\u0026amp;q=30\u0026amp;auto=format\u0026amp;w=600\u0026amp;h=450\u0026amp;fit=crop\u0026amp;dpr=2 1200w, https:\/\/images.theconversation.com\/files\/747019\/original\/file-20260709-71-o4kknq.jpg?ixlib=rb-4.1.1\u0026amp;q=15\u0026amp;auto=format\u0026amp;w=600\u0026amp;h=450\u0026amp;fit=crop\u0026amp;dpr=3 1800w, https:\/\/images.theconversation.com\/files\/747019\/original\/file-20260709-71-o4kknq.jpg?ixlib=rb-4.1.1\u0026amp;q=45\u0026amp;auto=format\u0026amp;w=754\u0026amp;h=566\u0026amp;fit=crop\u0026amp;dpr=1 754w, https:\/\/images.theconversation.com\/files\/747019\/original\/file-20260709-71-o4kknq.jpg?ixlib=rb-4.1.1\u0026amp;q=30\u0026amp;auto=format\u0026amp;w=754\u0026amp;h=566\u0026amp;fit=crop\u0026amp;dpr=2 1508w, https:\/\/images.theconversation.com\/files\/747019\/original\/file-20260709-71-o4kknq.jpg?ixlib=rb-4.1.1\u0026amp;q=15\u0026amp;auto=format\u0026amp;w=754\u0026amp;h=566\u0026amp;fit=crop\u0026amp;dpr=3 2262w\u0022 sizes=\u0022(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px\u0022\u003E\u003C\/p\u003E\u003Cfigcaption\u003E\u003Cspan class=\u0022caption\u0022\u003EData center critics point to soaring utility bills as one of the chief negative effects, given the centers\u2019 huge appetite for power.\u003C\/span\u003E \u003Ca class=\u0022source\u0022 href=\u0022https:\/\/newsroom.ap.org\/home\/search?query=data%20center%20protestors\u0026amp;mediaType=photo\u0022\u003E\u003Cspan class=\u0022attribution\u0022\u003EAP Photo\/Jeff Amy\u003C\/span\u003E\u003C\/a\u003E\u003C\/figcaption\u003E\u003C\/figure\u003E\u003Ch2\u003EWhat About Electric Bills?\u003C\/h2\u003E\u003Cp\u003EElectricity in the United States is delivered through complex regional grids and regulated utilities. In turn, retail prices depend on state and local rules and how costs are allocated among households, businesses and large industrial users.\u003C\/p\u003E\u003Cp\u003EThis complicated patchwork goes to the heart of one of the biggest criticisms of data centers: Because they\u2019re extraordinarily power-intensive, opponents say, they \u003Ca href=\u0022https:\/\/www.wsj.com\/business\/energy-oil\/ai-data-center-power-costs-bbfcd862\u0022\u003Ehike electric bills\u003C\/a\u003E for consumers. So we looked at counties where a utility\u2019s service area was localized enough to isolate the effects. We found that retail electricity prices rose by about 5% after a data center becomes operational.\u003C\/p\u003E\u003Cp\u003EOur estimate of 5% is not universal, however. Utility territories most often span multiple counties, while rate-setting rules differ by state and utility. And prices are \u003Ca href=\u0022https:\/\/www.eia.gov\/energyexplained\/electricity\/prices-and-factors-affecting-prices.php\u0022\u003Eaffected by other factors\u003C\/a\u003E, such as weather, transmission systems and regulations. That made the electricity effect harder for us to pin down than the other economic outcomes we studied.\u003C\/p\u003E\u003Cp\u003EBut if our estimates stand, our figure is substantially lower than \u003Ca href=\u0022https:\/\/www.njpp.org\/media\/press-release\/ai-data-centers-drive-20-electric-bill-spike-cost-new-jersey-families-billions\/\u0022\u003Esome more sensational reports\u003C\/a\u003E, which may not be correct in attributing bigger hikes in electric bills to data centers.\u003C\/p\u003E\u003Ch2\u003EWhy Tensions are Running High\u003C\/h2\u003E\u003Cp\u003EPushback against data centers has picked up since 2024, as proposed projects have grown larger and more visible. Communities often make decisions amid uncertainty, with little local evidence to draw on.\u003C\/p\u003E\u003Cp\u003EOur findings help clarify part of that uncertainty: Economic spillovers are strong in metropolitan counties, while many rural counties see minimal gains in job growth.\u003C\/p\u003E\u003Cp\u003EWe also find that opposition to data centers is more common where data centers already operate. That pattern suggests local experience may matter, although it doesn\u2019t explain how much opposition reflects direct local experience versus \u003Ca href=\u0022https:\/\/news.gallup.com\/poll\/709772\/americans-oppose-data-centers-area.aspx\u0022\u003Ebroader anxiety\u003C\/a\u003E about the impact of artificial intelligence more generally.\u003C\/p\u003E\u003Ch2\u003EBeyond the Construction Incentives\u003C\/h2\u003E\u003Cp\u003EAs more data center siting decisions come up, lawmakers will need to judge whether a county\u2019s economy will benefit and whether the project\u2019s terms will help all residents even when they don\u2019t share those gains. This means that the details of local subsidy design matter, including tax incentives, electricity tariff arrangements, grid and water upgrades, and whether \u003Ca href=\u0022https:\/\/www.wsj.com\/us-news\/education\/the-teachers-getting-50-000-bonuses-thanks-to-a-massive-meta-data-center-b4631d05\u0022\u003Eany new resulting tax revenue will boost public services\u003C\/a\u003E.\u003C\/p\u003E\u003Cp\u003ETogether, those factors can matter more than the headline investment figure touted in a company press release. While our findings are a starting point to help navigate this emotional debate, more work is needed on how these other decisions shape community outcomes.\u003C!-- Below is The Conversation\u0027s page counter tag. Please DO NOT REMOVE. --\u003E\u003Cimg style=\u0022border-color:!important;border-style:none;box-shadow:none !important;margin:0 !important;max-height:1px !important;max-width:1px !important;min-height:1px !important;min-width:1px !important;opacity:0 !important;outline:none !important;padding:0 !important;\u0022 src=\u0022https:\/\/counter.theconversation.com\/content\/286750\/count.gif?distributor=republish-lightbox-basic\u0022 alt=\u0022The Conversation\u0022 width=\u00221\u0022 height=\u00221\u0022 referrerpolicy=\u0022no-referrer-when-downgrade\u0022\u003E\u003C!-- End of code. If you don\u0027t see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: https:\/\/theconversation.com\/republishing-guidelines --\u003E\u003C\/p\u003E\u003Cp\u003E\u0026nbsp;\u003C\/p\u003E\u003Cp\u003E\u003Cem\u003EThis article is republished from \u003C\/em\u003E\u003Ca href=\u0022https:\/\/theconversation.com\u0022\u003E\u003Cem\u003EThe Conversation\u003C\/em\u003E\u003C\/a\u003E\u003Cem\u003E under a Creative Commons license. Read the \u003C\/em\u003E\u003Ca href=\u0022https:\/\/theconversation.com\/why-better-off-cities-and-towns-see-more-benefits-from-data-centers-than-rural-regions-286750\u0022\u003E\u003Cem\u003Eoriginal article\u003C\/em\u003E\u003C\/a\u003E\u003Cem\u003E.\u003C\/em\u003E\u003C\/p\u003E\u003C\/div\u003E","summary":"","format":"full_html"}],"field_subtitle":"","field_summary":[{"value":"\u003Cp\u003EData center development can boost growth and jobs \u2013 but these benefits are most pronounced when the local economy is more urban and developed.\u003C\/p\u003E","format":"limited_html"}],"field_summary_sentence":[{"value":"Data center development can boost growth and jobs \u2013 but these benefits are most pronounced when the local economy is more urban and developed."}],"uid":"27469","created_gmt":"2026-08-03 13:42:23","changed_gmt":"2026-08-03 13:50:42","author":"Kristen Bailey","boilerplate_text":"","field_publication":"","field_article_url":"","location":"Atlanta, GA","dateline":{"date":"2026-07-10T00:00:00-04:00","iso_date":"2026-07-10T00:00:00-04:00","tz":"America\/New_York"},"extras":[],"hg_media":{"680751":{"id":"680751","type":"image","title":"file-20260709-57-1gq2i8.jpg","body":"\u003Cp\u003EAfter a rush to attract data centers with incentives, more communities are pushing back against their development. \u003Ca href=\u0022https:\/\/newsroom.ap.org\/home\/search?query=data%20center%20construction\u0026amp;mediaType=photo\u0022\u003EAP Photo\/Ted Shaffrey\u003C\/a\u003E\u003C\/p\u003E","created":"1785764604","gmt_created":"2026-08-03 13:43:24","changed":"1785764604","gmt_changed":"2026-08-03 13:43:24","alt":"After a rush to attract data centers with incentives, more communities are pushing back against their development. AP Photo\/Ted Shaffrey","file":{"fid":"265061","name":"file-20260709-57-1gq2i8.jpg","image_path":"\/sites\/default\/files\/2026\/08\/03\/file-20260709-57-1gq2i8.jpg","image_full_path":"http:\/\/hg.gatech.edu\/\/sites\/default\/files\/2026\/08\/03\/file-20260709-57-1gq2i8.jpg","mime":"image\/jpeg","size":390013,"path_740":"http:\/\/hg.gatech.edu\/sites\/default\/files\/styles\/740xx_scale\/public\/2026\/08\/03\/file-20260709-57-1gq2i8.jpg?itok=2XEWrALn"}}},"media_ids":["680751"],"related_links":[{"url":"https:\/\/theconversation.com\/why-better-off-cities-and-towns-see-more-benefits-from-data-centers-than-rural-regions-286750","title":"Read This Article on The Conversation"}],"groups":[{"id":"658168","name":"Experts"},{"id":"1214","name":"News Room"},{"id":"1188","name":"Research Horizons"},{"id":"1274","name":"Scheller College of Business"}],"categories":[],"keywords":[{"id":"187915","name":"go-researchnews"},{"id":"194974","name":"go-theconversation"}],"core_research_areas":[],"news_room_topics":[{"id":"71881","name":"Science and Technology"}],"event_categories":[],"invited_audience":[],"affiliations":[],"classification":[],"areas_of_expertise":[],"news_and_recent_appearances":[],"phone":[],"contact":[{"value":"\u003Ch5\u003EAuthors:\u003C\/h5\u003E\u003Cp\u003E\u003Ca href=\u0022https:\/\/theconversation.com\/profiles\/daniel-yue-2723889\u0022\u003EDaniel Yue\u003C\/a\u003E, assistant professor of business, \u003Ca href=\u0022https:\/\/theconversation.com\/institutions\/georgia-institute-of-technology-1310\u0022\u003EGeorgia Institute of Technology\u003C\/a\u003E\u0026nbsp;\u003Cbr\u003E\u003Ca href=\u0022https:\/\/theconversation.com\/profiles\/yiyang-zeng-2723891\u0022\u003EYiyang Zeng\u003C\/a\u003E, postdoctoral fellow of business, \u003Ca href=\u0022https:\/\/theconversation.com\/institutions\/georgia-institute-of-technology-1310\u0022\u003EGeorgia Institute of Technology\u003C\/a\u003E\u003C\/p\u003E\u003Ch5\u003EMedia Contact:\u003C\/h5\u003E\u003Cp\u003EShelley Wunder-Smith\u003Cbr\u003E\u003Ca href=\u0022mailto:shelley.wunder-smith@research.gatech.edu\u0022\u003Eshelley.wunder-smith@research.gatech.edu\u003C\/a\u003E\u003C\/p\u003E","format":"limited_html"}],"email":[],"slides":[],"orientation":[],"userdata":""}}}