The double-edged sword of AI data centers

Data center construction is increasingly becoming a political issue, with locals organizing against major tech companies like Meta, Amazon and Google, which are spending billions in a push to create the infrastructure they want to power their artificial intelligence projects.

As backlash to data center construction grows across the country, year-end analyses suggest that the construction boom may be the only thing currently keeping the American economy chugging along. At the same time, the consequences if AI lives up to the promise of replacing huge amounts of human labor could be just as dire.

Opposition to construction often stems from concern over the impact that the giant facilities will have on the environment and local communities, with some projects sprawling across thousands of acres. However, it’s not just environmentalists who are concerned with the impact of these megaprojects, which are expected to drive up electricity prices dramatically while providing a tiny number of jobs, given their outsized footprint and impact on the environment, and even threatening to replace some workers with the very AI programs they are built to facilitate.

The mounting pressure has led some in elected office, such as Sen. Bernie Sanders, I-Vt., to propose a moratorium on new datacenter projects, telling CNN, “Frankly, I think you gotta slow this process down. It’s not good enough for the oligarchs to tell us, ‘It’s coming, you adapt.’ What are they talking about? Are they gonna guarantee health care to all people? What are they gonna do when people have no jobs? Make housing free?”

One complication for advocates of a moratorium, however, is that leadership in the United States has bet the farm on AI, and potentially created a situation where the average person stands to lose whether data center construction continues apace or slows down.

Numerous reports have found that the data center buildout is driving GDP growth in the United States. One October analysis from Harvard economist Jason Furman found that, subtracting growth from data center construction, GDP grew at just 0.1% in the first half of 2025 and that AI was responsible for 92% of GDP growth in the first half of 2025. A September report from JPMorgan found AI-related capital expenditures were responsible for 1.1% of GDP growth in the first half of the year. While it’s difficult to say what growth might have been without this buildout (critics note that without AI investors would have looked elsewhere for opportunities), it’s clear that AI, and the building of its infrastructure, is already a significant part of the economy.

Combined with the possibility that the AI industry could be in the midst of a speculative bubble, AI’s prominence in the broader economy is cause for concern with skeptics, especially as the broader economy grapples with tariffs and inequality.

For now, however, the buildout has been a boon for some areas of the economy, especially construction. According to Meta’s estimates, there will be some 5,000 people employed in the construction of its Richland Parish Data Center in Louisiana.

Jason Dedon, the business manager at the International Brotherhood of Electrical Workers Local 995 in Baton Rouge, said that the buildout had helped to employ a new generation of electricians, who are being trained for data center construction. While Dedon told Salon in an interview that the union doesn’t get involved in the debate on whether to build a data center or not, many members have benefited from the project in terms of employment.

“In a lot of the benefits agreements, they’re guaranteeing trying to achieve prevailing living wages and retirement systems, and paying into health insurance plans and also paying back into training and making sure training is being developed. The next generation is being made on those projects daily,” Dedon said.

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Dedon added that they’ve also taken the data center projects as an opportunity to look ahead, understanding that once a data center is built, many of the people who worked on the project will have to look elsewhere for jobs. He contrasted the construction of a data center with the construction of a power plant, noting that there would be jobs for hundreds of electricians even after the project was finished, which isn’t the case with a data center.

For example, one Texas data center has a team of some 1,500 people working on construction, but is only expected to have around 100 full-time employees working at it once it’s done, per the Wall Street Journal. At the aforementioned Louisiana data center, set to be one of the largest ever, Meta says the facility will employ 500 people total once it’s complete, a fraction of the 5,000 who are working to build it.

“They knew there were these long-term jobs that were created, and you had maybe generations of people that you know went to work and retired from that establishment,” Dedon said. “This isn’t quite that.”

Servaas Storm, an economist at Delft University of Technology in The Netherlands, also warns that, alongside potentially dampening the construction boom, a moratorium on data center construction could have other serious impacts on the U.S. economy.

Storm pointed out that the richest Americans are the ones who overwhelmingly benefit from AI, namely through the rise in asset prices like stocks, and through high wages in the tech and finance industries. At the same time, Storm noted, it’s these same wealthy Americans who are driving consumer spending in the U.S. economy. A downturn in the AI sector, whether through a data center moratorium or otherwise, could result in a pullback in their spending and a decline in stock prices.

Storm added that such a downturn could stand to make economic metrics, like GDP, more representative of the existing economic conditions most Americans are already living in. At the same time, losses, even if concentrated among the rich, could still lead to broader job losses, especially in leisure industries.

“It should tell everyday Americans that the economy is not in good shape and that the AI industry and government are betting the farm (and more) on a very risky and unproven strategy involving the scaling of AI (building ever-larger models based on ever-more GPUs, data centers, electricity and water),” Storm said. “This can — and probably will — go terribly wrong. There is no universe in which the giga-expenditures on GPUs, data center infrastructure and compute will pay off. It means that this particular growth strategy, which has the support of the current administration, is not economically sustainable.”

At the same time, supporters of a moratorium are warning of the dangers that AI could have if it does live up to the promises of the tech giants, specifically, potentially massive job loss.

Sanders has pointed out that major corporations like Walmart, UnitedHealth Group and JPMorgan Chase have already started telling investors that AI will allow them to cut payrolls. A report from Sanders’ senate office also warned that AI could stand to replace as many as 100 million jobs over the next decade, with losses especially concentrated in fast food, customer service, retail and laborers who work in freight and moving materials.

While Sanders has proposed a suite of policies aimed at ensuring AI adoption stands to benefit workers, with provisions like a “robot tax” that raises funds to help displaced workers from companies using AI and automation, the Trump administration has, so far, only worked to protect the interests of the companies developing AI.

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