Michigan’s data center boom offers a lifeline to construction companies post-EV bust

Michigan's construction industry is experiencing a significant pivot from the struggling electric vehicle (EV) market to a burgeoning data center sector. This shift comes as major automotive manufacturers like General Motors, Ford, and Stellantis have scaled back EV production, leaving construction firms seeking new projects. State-level tax incentives and a surplus of electricity are positioning Michigan as an attractive location for data center development, with nearly two dozen proposals, including three "hyperscale" facilities, currently on the table. Key figures in the construction industry are optimistic about this new wave of development. Mike Haller, CEO of Detroit-based Walbridge Group, which is involved in major projects like Oracle's Stargate data center in Saline Township and another in Lyon Township, noted that the timing is favorable as skilled trades workers are available. However, an accelerated buildout timeline is sparking concerns about potential labor shortages. Jonathan Noble, senior director of government affairs and infrastructure at Microsoft, which is developing a large data center south of Grand Rapids, emphasized the long-term career opportunities for tradespeople, countering public opposition arguments that data center construction jobs are only temporary. Economists like Patrick Anderson of Anderson Economic Group highlight the substantial economic output, ranging from $121 million to $5.5 billion per data center project during construction and up to $55.5 billion over their operational lifespan. Tyler Marie Theile, vice president and public policy director at Anderson Economic Group, views data centers as a much-needed economic boost for the state, helping retain workers and grow its population. Despite the optimism, challenges remain in managing the specialized mechanical, electrical, and plumbing (MEP) requirements of data centers and ensuring a sufficient skilled workforce, as discussed by industry leaders like Matt Lentini of Barton Malow Co. and David Volkman Jr. of Motor City Electric Co. Ryan Bennett, business leader for the West Michigan Plumbers, Fitters and Service Trades Local Union No. 174, expressed confidence in the union's ability to meet demand, citing high apprenticeship interest.