AI data center growth raises Pittsburgh-area hopes, but job gains and community benefits aren’t guaranteed

Pittsburgh's Public Source is an independent nonprofit newsroom serving the Pittsburgh region. Sign up for our free newsletters.

The artificial intelligence boom transforming parts of the country and emerging in the state is bringing to Pittsburgh expectations of new jobs, fears of employment losses and concern about how communities can exercise control.  

Western Pennsylvania has around a dozen data centers going back more than a decade. Today, though, the AI wave is leading to investments in new data centers statewide, often repurposing previous industrial sites. 

In places like Loudon County, Virginia, where the data center boom is further along, development has brought debates on high-powered lines in populated areas, water consumption and power needs. 

In Pennsylvania, the terms of engagement can sometimes be set before construction even begins.

“Local officials need to educate themselves and have honest, binding dialogue with companies looking to locate in their backyards,” said John L. Augustine III, president and CEO of Penn’s Northeast, during a recent state Senate policy hearing on data centers. Penn’s Northeast is a nine-county economic development organization. 

State Sen. David Argall, R-Schuylkill, Carbon and Luzerne; and Rosemary Brown, R-Lackawanna, Monroe and Wayne, held that hearing with AI experts, lawyers and investors to better understand the developing industry’s aims, and explore ways to leverage these investments for public benefit. On the federal side, Sen. David McCormick’s AI summit previewed a possible future for the state as the demand for computing power rises. Another Pittsburgh AI strategy session is set for Sept. 11 and 12. 

The Fourth Industrial Revolution and a Global AI Race

“I want to introduce you to and welcome you to our fourth industrial revolution,” Augustine said at the hearing. “Because of things like e-commerce, cloud computing, apps like Google Maps and Twitter, the phenomenal growth of AI we are presented today with [is] our fourth generational opportunity. Our fourth industrial revolution: data centers.” 

He called it “a high-tech industry that brings high-paying jobs that so many of us have worked so long and hard to attract. Listen to the facts, not the hype.”

Far from hype, interest in AI infrastructure is closely tied to American defense interests and the search for the next evolution in computing — artificial general intelligence, with human-like capabilities. 

“If artificial general intelligence is created then there's going to be artificial super intelligence. And people who have that can control conventional, non-conventional warfare,” said Rich DiClaudio, president and CEO of the Energy Innovation Center Institute, a nonprofit dedicated to training people in Western Pennsylvania and beyond. “I don't know if that will happen but two countries are saying if that's going to happen, we need to be in charge of it. And those countries are the U.S. and China. So now they're off to the races.”

DiClaudio and others are seeking to train people for that race — fast. But they’re starting from behind.

The Allegheny Conference on Community Development counts eight coming data center projects and related gas and nuclear energy developments that “could support nearly 200,000 jobs throughout Southwestern Pennsylvania on a direct, indirect, and induced basis” and have an estimated economic impact of $20 billion.

The problem: Western Pennsylvania, along with parts of Ohio and West Virginia, is facing a 10,000-person skilled infrastructure workforce gap by 2029, DiClaudio said. The Pittsburgh region has lost 23% of its skilled trades workforce ages 25-to-44 since 2012. 

The institute’s goal is to close that workforce gap by offering free education to appropriate candidates. “We're focusing on people with disadvantaged backgrounds,” he said. Over 11 years, the institute focused mostly on infrastructure training, recently emphasizing AI. “We've trained over 5,500 people; 86% of graduates get jobs they trained for.”

The institute will be training high school students starting this fall to be able to adapt to a quickly changing job market. 

“What are going to be the jobs that are AI-enabled and what are the jobs being AI destroyed?” DiClaudio asked. “Low-level white collar jobs — accounting, legal, logistics — a lot of that is at risk and is already happening.”

DiClaudio wondered if there’s a way to manage this disruption by creating pathways for employees to transition into other positions and to help people read the trends and stay ahead of expected job loss.  

“Companies are laying off low-level employees now,” he said. “And those people who get laid off have to find new careers. It's very disruptive. I don’t believe it can be stopped. But it can and should be curated.”

He doesn’t know who would “curate” the disruption here. “No one is trying to organize a group to tackle these issues.”

Allegheny County Executive Sara Innamorato’s office noted they weren’t aware of any county-wide initiatives to help employees avoid losing their jobs by retraining them in other fields or furthering their education to gain more AI-resistant skill sets.

Earlier this month leaders at Indiana University of Pennsylvania held a regional call to action for educators in an attempt to address the workforce gaps. Christina Koren, the university's director of strategic partnerships, said that with a data center slated for the county’s Homer City area, many in the region have wondered how they could get involved in the economic benefits. 

In an attempt to “align education and industry," Koren said, the university hosted about 160 people on Aug. 7 to speak with representatives of the Homer City development about how educators can help students prepare for an emerging market. 

​​”People are chomping at the bit, this is gaining attention in Harrisburg and D.C.,” Koren said. “We recognize the investment and potential impact on workforce development.”

Eastern Pennsylvania Ahead on Preparation

During the state Senate hearing, Luzerne County Community College President John Yudichak noted that community colleges across the state are “collaborating and combining resources like never before to build a new and historic statewide technology and trades workforce consortium” to address a workforce gap identified in a 2024 report by the state Department of Education.

“We have an acute workforce shortage by 2032 of 218,000 Pennsylvania workers who will lack post-secondary credentials and skills to meet the demands of the job market,” Yudichak said. “Currently there's a skills gap of 12,200 workers in the trade and maintenance workforce cluster. [That] gap will grow exponentially if unaddressed as data center development grows in Pennsylvania.”

Yudichak said that the state’s community colleges, with their relatively affordable education options, are the best suited to closing this workforce gap “and lead the AI technological revolution.”

So far, this effort is being led by community colleges in Luzerne, Northampton, Bucks and Lehigh and Carbon counties, according to Yudichak. 

The Community College of Allegheny County is not currently involved in any workforce development programs for AI data centers, according to a spokesperson. 

The eastern colleges are revamping their programs by including educational partnerships between community colleges and career and technical high schools. Luzerne’s community college recently received a $1 million dollar grant from the state’s Department of Education to fund these partnerships and provide free tuition to students looking to further their education for the data center industry, according to Yudichak.

Building and construction trade unions are creating similar partnerships intended to streamline data center workforce development in fragmented Pennsylvania.

Do Communities Have a Choice?

Emerging AI data center developments in Western Pennsylvania all share some commonalities: They are resource hungry, and the unclear effects on employment leave municipalities with more questions than answers. 

Augustine said communities need to have binding conversations with developers because every data center project is unique and comes with its own set of challenges and benefits.

Municipalities that set up formal agreements with planned data centers will be well positioned to reap the benefits of renewed economic activity. Many of these data centers, Augustine and others at the hearing said, can revive abandoned industrial sites. 

During the state Senate hearing, Esch McCombie, a real estate lawyer, said many of his clients are organizations looking to construct data centers in Pennsylvania. 

“Municipalities can put regulations on data centers but they have to allow them somewhere,” McCombie said during a follow-up interview. “They are coming to Pennsylvania whether we like it or not.”

As municipalities across the state consider their options, McCombie said leadership can encourage or discourage data center development using zoning and regulations.

“If they want to encourage, they need to put in regulations and zoning that protect public health, safety and welfare but are more open and allow data centers to come in with the size and shape to meet their needs and in a manner that can happen fairly quickly,” he said. 

But time is everything, he said, with development largely set to happen over the next two or three years, but implications extending out decades.

“My belief, data centers aren't going to be in a flash pan. Once it's built it's going to be there for a long time.”

Municipalities that want to attract data centers should quickly spell out clear rights for them in some zones, with reasonable regulations, within months, he said.

And those that don’t want data centers?

“To discourage, create regulations to make it more difficult. They can't exclude them but they can make it more difficult,” McCombie said.  

Small Towns Face Big Questions

Earlier this year a New York-based financial firm demolished the Homer City Generating Station, in Indiana County’s Center Township, to make room for a  $10 billion natural gas-powered plant expected to be running in 2027. Plans also call for a data center around the plant, but specifics haven’t been released. 

The plans were announced by Homer City Redevelopment LLC last year and their press releases contain disclaimers about job creation claims. They estimate operational data centers will employ 1,000 direct and indirect workers.

But the disclaimer notes it contains“statements related to future events that by their nature address matters that are, to different degrees, uncertain.” 

For Center Township, residents and leaders will have to be content with this uncertainty, as the redevelopment project will not require any of the zoning variances that are giving other municipalities a chance to negotiate, according to Center Township Supervisor Matt Housholder. 

One way that communities can counter uncertainty is to enter into a community benefits agreement, according to Kristopher Gazsi, a staffer with the Local Government Commission of the Pennsylvania General Assembly. 

“In this environment of challenges and opportunities, I think that our local governments and our local communities are really at a position where they are yearning for communication — communication from the industry, communication from the commonwealth, and to dispel rumors and concerns they have,” Gazsi said.

He said an agreement should seek to “work out some of these issues so that everybody walks away happy and you have the ability to earn the enthusiastic support of the community as a whole.” 

A spokesperson for Lancaster confirmed that the city is considering the use of a community benefits agreement with an AI data center developer but declined to share details, noting, “we are in the preliminary stages of work regarding the development of a community benefits agreement, so I’m not currently able to provide details.”

In Springdale Borough, in the Allegheny Valley, a proposed data center doesn’t yet have a data center operator. Nonetheless, community members will have an opportunity to make demands and ask concessions from any AI company looking to build in their community, according to Manager Terry Carcella. 

Carcella noted that the development is still in the preliminary stages but so far the plans are for a “hyper large data center” to be built on an old coal burning power plant. 

Because the area’s zoning doesn’t permit construction of tall structures, the developers will have to ask the borough for a conditional use. 

“So we have a chance to set reasonable conditions to protect residents the next street over,” Carcella said. “We're concerned about noise so we want them to know they have to comply with residential noise levels. As far as support for it, there's a lot of support, it will create jobs and become a water customer.”

The public will have an opportunity to comment during a Sept. 24 planning commission meeting.

If approved, a large-scale data center in the area would bring many temporary construction jobs, and 80 to 100 long-term jobs, Carcella said. 

“It will require both highly skilled employees but also those who don't have high technical skills, with things like security and maintenance,” Carcella said. 

Overall, “it's a win-win for the borough,” he said.

Eric Jankiewicz is Pittsburgh Public Source’s economic development reporter and can be reached at ericj@publicsource.org or on Twitter @ericjankiewicz. This story was fact-checked by Katherine Wilkison.

This article first appeared on Pittsburgh's Public Source and is republished here under a Creative Commons Attribution-NoDerivatives 4.0 International License.