New research from Georgia Tech suggests the economic benefits of data centers are real but uneven, with metropolitan counties capturing most of the gains while many rural communities see only limited improvements despite hosting billion-dollar facilities.
The study, released last week by Georgia Tech researchers Daniel Yue, assistant professor of IT management, and Yiyang Zeng, a postdoctoral fellow, analyzed how data center openings affect employment, wages, business activity and electricity prices across U.S. counties.
Our paper begins to fill that gap by providing new evidence using detailed, facility-level data paired with county-level economic outcomes,” Zeng said, referring to growing community opposition and limited evidence on the local impact of data centers.
Metro Areas Capture Most Of The Benefits
The researchers found counties hosting new data centers generally recorded measurable economic gains. During the first three years after a facility opened, employment rose 0.9%, wages increased 1.1%, business establishments grew 1% and household income climbed 0.7%. Over the longer term, those gains expanded to 3.5%, 5%, 4.7% and 1.9%, respectively, while building permits also increased.
However, the study said those benefits remained modest relative to the scale of investment and varied widely by location. Metropolitan counties saw the biggest gains because they already had larger labor pools, suppliers and business networks to support data centers.
“It’s the characteristics of the host community, not just the facility opening there, that determine whether the local benefits show up,” Zeng said.
Rural counties, meanwhile, saw limited spillover benefits because data centers typically employ fewer than 100 permanent workers and rely on outside contractors and suppliers. While unemployment fell slightly, broad job and wage growth largely failed to materialize.
Higher Electricity Costs Remain A Trade-Off
The study also found a trade-off: retail electricity prices rose about 5% in areas where the impact could be measured after a data center became operational.
“When the benefits to communities are small, downsides like higher electricity prices and added pressure on local infrastructure will be felt by locals,” Zeng said.
The researchers noted utility bill impacts vary by state and provider because electricity costs are allocated differently. They said communities should closely examine infrastructure costs, tax incentives and electricity pricing before approving new projects.
AI Infrastructure Expansion Faces Growing Scrutiny
Earlier reporting highlighted that Goldman Sachs expects global data center electricity demand to surge 220% by 2030, with roughly 60% of the additional demand coming from the U.S. Data centers currently account for about 6% of U.S. electricity demand, a figure the investment bank expects could rise to 11% by the end of the decade.
The rapid AI infrastructure buildout has also fueled record investment, with U.S. technology companies committing more than $850 billion toward data center leases during the first quarter of 2026.
At the same time, opposition to large data centers has intensified nationwide. Earlier reporting found at least $130 billion worth of U.S. data center projects were blocked or delayed during the first quarter. Earlier this week, New York Gov. Kathy Hochul announced a temporary pause on new hyperscale data centers consuming 50 megawatts or more as the state develops new environmental and grid standards.
The Georgia Tech researchers said their findings suggest policymakers should focus less on headline investment figures and more on whether local economies are positioned to capture long-term benefits.
“In 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’ long-term interests,” Zeng said. “It’s 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.”
Disclaimer: This content was produced with the help of AI tools and was reviewed and published by Benzinga editors.
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