When the first Google data center was built in Oregon a dozen years ago, it’s fair to say that the future demand for and impact of these behemoth facilities was understood by few. Now, ballooning data storage needs and the expectation for instant access to everything from email, to streaming videos to work connectivity has skyrocketed, making these data centers more critical than ever.
Google recently broke ground on its eighth U.S. data center and released a report, prepared by Oxford Economics, that details the economic impact that data centers have on local communities.
According to the report:
- Google data centers have, as of 2016, generated $1.3 billion in economic activity, $750 million in labor income, and 11,000 jobs throughout the United States. Included in the 11,000 jobs are an estimated 1,900 people directly employed on the data center campuses. In addition, facilities on these campuses are recurrently upgraded and expanded and, on average, this effort employs more than 1,100 construction workers annually.
- Google data centers create economic opportunity well beyond the campus itself. On-campus activity is further supported by an external supply chain that employs nearly 3,500 additional workers. As those employed directly on campus and in the supply chain spend their wages, a further 4,700 jobs are supported in the wider consumer economy, for example, in retail and leisure establishments. In fact, when these channels are considered, each direct Google data center job is found to support an additional 4.9 jobs throughout the U.S. (for a national jobs multiplier of 5.9).
- Beyond the construction and operations of the data centers, Google’s long-term commitment to take power from renewable energy sources has both environmental and economic benefits. Google’s renewable energy efforts have resulted in $2.1 billion of investment in eight renewable energy generation projects for wind and solar. The construction phase of these projects required an estimated 2,800 direct jobs, and the combined maintenance and operation now supports an estimated 520 ongoing jobs.
- The opening of a Google data center has a significant benefit on the local economy. Through regression analysis, the study found measurable local spillover effects within three years of the data center opening, including employment gains that went further than those directly connected to the data center campus as well as an increase in county residents holding a bachelor’s degree.
Kathryn Hamilton is Vice President for Marketing and Communications at NAIOP Corporate.