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As the world’s largest tech companies move into small towns to build massive datacenters, what does that mean for the people who live there?
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Introduction
Technology has always been a driving force of change, creating new industries and transforming existing ones. The rise of the internet and mobile technologies has had a particularly profound impact, opening up new opportunities for businesses and consumers alike.
One area that has seen significant change in recent years is the data center industry. The explosive growth of data-intensive applications such as streaming video, cloud computing, and artificial intelligence has created a need for larger and more sophisticated data centers. These facilities are typically located in urban areas, where they can take advantage of the talent pool, infrastructure, and other amenities that cities have to offer.
However, the data center industry is also having an impact on smaller towns and rural communities. As companies look to expand their data center operations, they are increasingly turning to these smaller locations in search of lower costs and other advantages. This is good news for these communities, which often struggle to attract investment and create jobs.
There are a number of factors driving this trend, including the availability of land, lower costs, and incentives from state and local governments. These factors are likely to continue to play a role in the future expansion of the data center industry.
Economic Impact
The advent of big tech datacenters in small towns across America has had a profound impact on the local economy. The construction of these facilities has created jobs and brought in much-needed investment. In addition, the datacenters have had a ripple effect on other businesses in the area, from hotels and restaurants to retail stores.
Jobs
One of the most immediate economic impacts of a new datacenter is the creation of new jobs. datacenters require a workforce to build, operate, and maintain them. These are good, high-paying jobs that often don’t require a college degree. For example, Facebook has committed to hiring 200 people for its new datacenter in Sweden.
The indirect effects of these jobs are also important. When workers have more money in their pockets, they spend it in the local economy on things like housing, food, and entertainment. This spending creates even more jobs. Economists call this the “multiplier effect.”
A study by the American Economic Association found that each job created by a datacenter leads to the creation of five more jobs in the local economy.
Investment
This investment by big tech companies has a large economic impact on these small towns. The construction of the datacenter itself creates hundreds of jobs, and once operational, the datacenter will require a small staff to maintain it. These direct jobs have a multiplier effect in the local economy, as workers will spend their wages in the town, supporting local businesses. In addition, the datacenter will likely lead to indirect and induced economic activity as businesses spring up to support the datacenter (e.g., IT services, security, etc.). This investment by big tech companies will have a positive impact on these small towns for years to come.
Community Impact
The migration of big tech datacenters to small towns is having a profound impact on these rural communities. While there are some benefits to this influx of jobs and investment, there are also a number of challenges that these towns face. Let’s take a closer look at the community impact of big tech datacenters.
Housing
The influx of workers has caused a strain on the housing market in Reno and the surrounding area. Home prices have increased, and vacancy rates are extremely low. Some workers are living in RVs or trailers, or commuting long distances from neighboring states.
Schools
The most common community impact that is discussed when big tech companies announce the construction of a new data center is the direct impact on the school system. Big tech companies usually invest money into the school system of the town they are building their data center in. This can be anything from direct financial contributions to initiatives to get more computer science classes into the high school curriculum. While this investment into the local schools is a good thing, it does not always offset the competition for resources that the data center brings.
The competition for resources comes in many forms. The first, and most obvious, is financial. Data centers require a lot of money to build and operate. This means that there is less money available for other things, like schools. The second form of competition is for land. Data centers require a lot of space, which means that they often displace other development, like housing or parks. The third form of competition is for water. Data centers require large amounts of water for cooling, which can put strain on local water resources.
The direct impact on schools is just one aspect of the community impact that big tech data centers can have on small towns.
Environmental Impact
When people think about the environmental impact of big tech, they often think about the huge datacenters that power our favorite online services. These datacenters use a lot of energy, and they generate a lot of heat. But the environmental impact of datacenters goes beyond just their energy use.
Water
What Big Tech Datacenters Mean for Small Towns: Water
Just a few years ago, the idea of a big tech company putting a datacenter in a small town was far-fetched. But as the demand for data storage has exploded, so has the need for datacenters. These massive facilities are now being built in rural areas across the country, often in small towns that are struggling economically.
The datacenter boom has brought jobs and investment to many small towns, but it has also put a strain on local resources, particularly water. Datacenters use enormous amounts of water to cool their servers and other equipment, and they are often located in areas with limited water resources. This can lead to conflict between the datacenters and other users of water, such as farmers or homeowners.
In some cases, the influx of datacenter money has helped to fund upgrades to local water infrastructure. But in other cases, it has simply made the problem worse by driving up the price of water and making it scarce. As more and more datacenters are built in rural areas, this issue is likely to become more common and more contentious.
Electricity
Data centers require a lot of electricity to operate. In fact, it is not uncommon for a large data center to use more electricity than an entire small town. This has a significant impact on the environment, as well as the economy.
Data centers are often located in areas with cheap or readily available electricity, such as coal-fired power plants. This means that the data centers are contributing to the pollution that is associated with these power plants. In addition, data centers typically have a very high PUE (power usage effectiveness), which means that they are not very efficient in their use of electricity.
The high electricity consumption of data centers also has an impact on the economy. Data centers typically sign long-term contracts with utilities, which can lead to higher prices for everyone else in the community. In addition, the construction of data centers can lead to an increase in demand for power, which can lead to blackouts and other problems.
Conclusion
While the construction of a Big Tech datacenter may initially disrupt the flow of traffic and commerce in a small town, the long-term benefits often outweigh the negatives. These benefits can include an influx of high-paying jobs, an increase in tax revenue, and an overall boost to the local economy. While datacenters may not be suitable for every small town, those that are able to successfully attract one can expect to see significant positive changes in their community.
