The Google Economic Effect
GOOGLE DATA CENTERS: ECONOMIC IMPACT AND COMMUNITY BENEFIT – A Comprehensive Study for the data center developing in Bridgeport (Jackson County), Alabama.
Since 2006, Google has opened six U.S. data center campuses. Each is a state-of-the-art, world-class facility that enables the company to provide the search engine, cloud computing, and other Web-based services on which so much of the modern economy depends. To date, the company has invested $10.5 billion in these facilities.
Prior to the Google announcement of a seventh Data Center was going to be developed and built in Bridgeport, AL, six data center campuses provide the technological infrastructure necessary to power Google’s operations in the United States.
In 2016, Google data centers 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.
New analysis in this report finds that the opening of a Google data center has a significant benefit on the local economy. From the development of the six prior Data enters it is certain that measurable local spillover effects will occur within three years of the data center opening. Most communities experienced employment gains (beyond those at the data center itself) or increases in the number of college-educated residents. Each of these benefits was spurred by Google’s decision to locate a data center in that community
Google Data Centers: $10.5 Billion Invested to Date
Source: Google LLC
Google’s long-term commitment to take power from renewable energy sources has economic as well as environmental benefit. For example, Google’s long-term contract commitments to renewable energy have resulted in $2.1 billion of investment in eight renewable energy generation projects (wind and solar), to date. The construction phase of these projects required an estimated 2,800 direct jobs.
The greatest value of landing a Google data center may come from seeding future economic growth and diversification in regions that need a boost. Google’s impact on its host communities starts with construction spending and data center jobs, but the ripple effects include broad-based workforce development, new revenue streams, and a reputation as a good place to do business, says Deborah Murray, executive director at the Caldwell County Economic Development Commission in Lenoir, North Carolina. When Google arrived a decade ago, the town was struggling with the loss of furniture jobs, which had sustained its economy for generations. Since then, the unemployment rate has plummeted, unused industrial square footage has decreased more than 90%, and median household income growth outpaced the rest of the state in 2016. The economy has diversified to include a meaningful advanced manufacturing component, and the workforce has reskilled to support what Ms. Murray calls “twenty-first and twenty-second century jobs.” “I’m not going to tell you that Google is responsible for all of this, but they helped us learn about our capabilities,” Ms. Murray says. “The world has changed, and Google helped us change with it.” “Google gave us the credibility to compete.” Ms. Murray says.
Similar stories are playing out in other Google communities. In Iowa, Google sparked a big-company, data-center boom with its Council Bluffs operation, and the same dynamic is in effect along the Columbia River in Oregon, where Google’s first data center opened in The Dalles in 2006.
Meanwhile, in Pryor Creek, Oklahoma, a rising generation is finding jobs in a rural area that must compete for talent with nearby Tulsa and other cities. Scott Fry is Director of Workforce Development at Pryor Creek’s Mid-America Industrial Park, home to a Google data center and dozens of other companies. With local school districts bolstered by Google support and the park’s visibility enhanced by its high-profile tenant, students are increasingly aware of opportunities in technical fields and the possibility of good work at Google or neighboring businesses. “We are getting great feedback from employers, with more young talent entering the workforce right out of high school,” Mr. Fry says. “Having Google in our community is a game changer.”
Google’s approach to philanthropy and community involvement
GOOGLE manages its local philanthropic involvement with a light touch, but that does not mean the company shies away from difficult issues. In Berkeley County, South Carolina, for example, the 2015 shooting of Walter Scott by a police officer and the 2015 massacre at Charleston’s Emanuel African Methodist Episcopal Church led Google to grant the College of Charleston Foundation $125,000 to found the Race and Social Justice Initiative (RSJI) at the college’s Avery Research Center for African American History and Culture. This organization’s goal is to promote public awareness and dialogue about race and socioeconomic issues in Charleston and beyond. In 2016, Google increased its support and donated $200,000. Local control matters. “We don’t want to run a grassroots initiative like this with corporate oversight. Google trusts us to run with it,” says Daron Lee Calhoun II, RSJI coordinator. “It’s a blessing for Google to run this the way they do.”
RENEWABLE CAPITAL INVESTMENT
To satisfy its commitment to renewable energy, Google has made long-term contractual commitments that have resulted in $2.1billion of investment in the construction of eight new renewable energy generation facilities. In addition to the obvious and important environmental benefit, these investments also resulted in one-time construction activity that generated additional economic impacts. The recent announcement that wind-generated electricity on 800 acres of land is being developed in Jackson County that will be specifically used by GOOGLE substantiates their commitment.
As reported by the communities themselves, Google’s presence helps ensure that the next generation of community residents is prepared to meet tomorrow’s challenges and opportunities.
Why Bridgeport (Jackson County) was chosen as the 7th Data Center in America
An examination of the existing county locations revealed several “rules” derived from publicly available data that were then applied to all counties in the lower 48 states. These rules were:
• Always locate in a state that allows sales tax exemptions for data center projects.
• Never locate more than 85 miles from a mid-to-large-sized metropolitan area.
• Never locate in a state with above average commercial electric rates
• Never locate in a state that is principally desert or abnormally dry (based upon average annual rainfall).
• Never locate in a county with more than 250,000 people.
• Never locate in a state that already hosts a Google data center.
Counties that satisfied these rules were then further screened to make sure that each had growth rates comparable (parallel) to the target counties.
Report to the Bridgeport Thriving Communities Project
By: __J.P. Parsons____________, Committee Member