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

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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.