AI data centers delay Texas housing projects as electrician shortage hits construction timelines

Exploding number of AI data center build-outs delay Texas housing projects -- data centers' high demand for electricians prices out contractors, homes now take two months longer to complete

Data centers pay 75% more and offer overtime and bonuses -- something that home builders cannot afford. The AI industry's massive push to build data centers and deliver more compute has found another unsuspecting victim -- home construction contractors. According to The Texas Tribune, data centers are hiring electricians en masse, resulting in a shortage of workers for housing projects. The Lone Star State is currently in a two-pronged boom: it's adding more residents, with more than 2.6 million people migrating into the region from 2020, and it's also playing host to hundreds of new data center projects. This means that a lot of construction projects are competing for specialized electrical workers from the same pool of about 71,000 electricians. These specialists are required for every construction project -- both homes and data centers -- as electricity can be dangerous if not set up properly. Unfortunately, AI hyperscalers have deeper pockets than the typical contractor, meaning they can pay electricians much more. For example, Scotty Wristen, who owns WE Electric in Abilene, Texas, (the same site as the first Stargate data center), told the publication that he can only afford to pay his workers $20 an hour. By comparison, data centers are able to offer up to $35 an hour, plus over time and additional benefits. The International Brotherhood of Electrical Workers told The Texas Tribune that, out of a data center's entire construction budget, nearly 45% to 70% are earmarked for electrical work. This is because of the massive amounts of electricity that these sites consume. The megawatts and gigawatts that tech executives easily throw around will have to be taken from the grid and distributed throughout the various buildings, facilities, floors, rooms, and individual servers in a single data center campus, and it takes professional electricians with years of experience to do that safely and efficiently. No one can blame the individual for finding better wages and gaining a more secure future for themselves and their families. But it's also putting a strain on the timeline of other construction projects, which are now struggling to find workers to fill the gap. This, in turn, causes delays in the turnover of housing projects, with some contractors saying that it is now taking up to two months longer to finish a single structure. Shortages like this could also lead to delays in data center projects. An analytics group said that 40% of AI data construction sites have possibly been delayed, despite many hyperscalers denying this. Aside from labor shortages, the build out is also facing constraints in the power supply chain, with half of planned projects affected. This massive push to build as many data centers as possible is just pushing available resources -- in chips, energy supply, labor, and everything else related to building and running them -- to the brink. However, hyperscalers do not want to stop pouring money into it, and so AI is now an arms race funded by very deep pockets. Now, aside from AI competing against contractors, time is also taking a toll on the workforce. It's estimated that 20,000 electricians across the country retire annually, accounting for about one in three workers between 50 and 70 years old. While the state has on-going training to bring more professionals into the field, it takes years of apprenticeship and experience before they can be licensed. Texas took steps to alleviate this by easing the licensing requirements for out-of-state practitioners from Iowa, Alabama, and Arkansas late last year, but it's still too early to see if this will influence the current shortage of workers. Follow Tom's Hardware on Google News, or add us as a preferred source, to get our latest news, analysis, & reviews in your feeds.

AI data centers are delaying Texas housing projects by hiring away electricians

Serving tech enthusiasts for over 25 years. TechSpot means tech analysis and advice you can trust. A hot potato: The AI data center gold rush is now colliding with one of Texas' other major problems: a shortage of homes. Builders say projects are taking up to two months longer to complete because data center operators are hiring away the electricians needed to wire new houses, duplexes, and apartments. According to The Texas Tribune, Abilene builder Gene Lantrip has seen his construction schedules slide since work began on the massive Stargate AI campus nearby. The 4 million-square-foot project, backed by OpenAI, Crusoe, and Oracle, is part of a wave of facilities spreading across Texas, which already has more than 300 data centers in operation and around 100 more in the pipeline. The problem is not that electricians are choosing data centers out of their love of AI; these jobs simply pay more. Scotty Wristen, owner of WE Electric in Abilene, told the Tribune he can afford to pay workers around $20 an hour. Data center jobs, on the other hand, can offer $35 an hour, plus overtime and per diem benefits. That's a 75% premium, which is difficult for smaller contractors to match. It's easy to see why the workers are moving. Electrical work can account for 45% to 70% of a data center's entire construction budget, according to the International Brotherhood of Electrical Workers. These facilities require enormous amounts of power to be distributed safely through buildings packed with power-hungry servers, cooling systems, backup equipment, and networking hardware. A house, unfortunately for builders, cannot compete with an AI campus on margins. The timing could hardly be worse for Texas. The state has added more than 2.6 million residents since 2020, creating heavy demand for new housing. At the same time, the electrician workforce is aging. Around 20,000 electricians leave the trade nationwide each year, and one in three is between 50 and 70 years old. Texas has roughly 71,000 employed electricians, but new workers require years of apprenticeship and hands-on experience before they can become licensed. State officials are trying to ease the squeeze by loosening license-transfer rules. Since November, Texas has made it easier for electricians from Iowa, Alabama, and Arkansas to transfer their licenses, and training programs are expanding. That won't help builders who need homes finished today, of course. The situation adds another item to the growing list of complaints about AI data centers. Communities have already pushed back over electricity demand, water use, noise, tax breaks, and relatively few permanent jobs.