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As tech giants and local data centres operators race to transform Australia into an Asia-Pacific hub for artificial intelligence, they are demanding access to the nation’s energy grid, water supply and prime land, backed in part by a big number: 935,000.
That’s how many jobs some in the industry say they are indirectly supporting. One operator said data centres “underpin” 935,000 jobs; its chief lobbyist said that many roles were “enabled” by the sector. But there’s good reason to be sceptical.
The statistic on data centre employment appears to come from consulting firm Mandala Partners’ October 2024 report Empowering Australia’s Digital Future, commissioned jointly by five of Australia’s largest data centre operators: AirTrunk, Amazon Web Services, CDC, Microsoft and NextDC.
One of the report’s infographics places 9600 data centre operational jobs alongside a figure of 935,000 broader tech sector jobs under a title reading: “Growing Australia’s data centre workforce will meet future demand and support jobs in the broader tech sector”.
The presentation implies the wider tech workforce depends on data centre expansion here.
It does not. The 935,000 figure is simply the Tech Council of Australia’s estimate of total technology sector employment, a count that includes everyone from software developers to graphic designers to HR managers and PR staff at internet publishing companies.
The report does not demonstrate that these roles depend on data centres being physically built in Australia.
Stela Solar, chief executive of Stone & Chalk, Australia’s largest innovation hub, says the nature of those jobs was being misrepresented.
“The data centre jobs described in the report don’t map onto the widely accepted definition of ‘tech jobs’,” Solar says. “The majority of roles created by data centres are in facilities management: electricians, HVAC technicians, clerical staff, admin workers, and executives overseeing building operations.”
The Mandala report’s figures on that kind of job creation are more modest.
It projects 17,900 operational data centre jobs by 2030, requiring 8300 new workers on top of the current 9600 data centre jobs. The report forecasts $26 billion in baseline investment in Australian data centres over that period, equating to roughly $3.1 million in capital for every permanent operational job.
Of course, much of that capital might be foreign investment in Australia, or come from a super fund earning a strong return for Australians’ retirement, so it is being put to a clear use.
Solar argues too that the real economic value for Australia lies not in the data centres themselves but in building a domestic software and AI industry on top of them.
“If the commercial value generated on top of Australian infrastructure flows mostly to foreign owners, Australia will fail to capture the lion’s share of the benefit of having data centres onshore,” she said. “The wealth will only be realised locally if we grow our domestic tech sector and support the next generation of Australian tech companies.”
Tom Sulston, head of policy at Digital Rights Watch, said the industry’s claims warranted scepticism.
“The tech industry in Australia is laying off workers at a rate of knots: Atlassian, WiseTech, Telstra. Largely, employers claim that this is due to AI efficiencies making those jobs redundant,” he said.
Belinda Dennett, chief executive of Data Centres Australia, the industry’s peak body, defended the sector’s broader value in an interview.
“I don’t know that we’ve made the connection that 935,000 jobs are dependent on data centres being built here,” she told this masthead. “But we would say that data centres enable us to have a digital economy in Australia. And if we didn’t have a digital economy, we wouldn’t have those tech jobs.
“If we don’t have that infrastructure here in Australia, then all we are going to do is be importing the tools. And we’ve seen that where we just import tools we don’t capture Australian culture, Australian language, and Australian values.”
Dennett also rejected the premise that opposing data centre construction would protect Australian jobs from AI displacement.
“I get that people are fearful of it and have concerns about [AI], but we’re not going to stop it,” she said. “We’re not going to stop it by not building the infrastructure here. I think if we build the infrastructure here, we are capturing more of that value chain, creating more of the jobs here.”
The Tech Council of Australia, which is responsible for the 935,000 figure, said the statistic did not represent the jobs that are directly dependent on data centres being physically located in Australia, and that many of those jobs would exist regardless of where data centres are located.
Mandala’s managing partner Amit Singh said the firm “firmly stands behind the report and its findings” and that the 935,000 figure was used as “contextual reference only”.
“Our work utilised conservative estimates of data centre construction and operations jobs,” Singh said in a statement. “While there can be legitimate concerns about aspects of data centre development, the evidence is clear that data centres represent a significant economic and technological opportunity.”
The e61 Institute, a non-partisan economic research body, has separately described data centre operators as “capital-intensive and relatively small employers”, citing data showing only around 11,500 data centres workers in Australia nationally.
International research from the US advocacy group Food & Water Watch found that the investment required to create a single permanent data centre job in Virginia – America’s largest data centre market – was nearly 100 times greater than for a job outside the industry.
Sulston raised a broader concern about whether the economic model underpinning the expansion was sustainable. “Will we be left with VC-funded white elephant AI data centres, stuffed with expensive and rapidly depreciating Nvidia chips, that no one can afford to use?” he said.
“We need to proceed with caution, taking care not to sacrifice our land, water, electricity and data to corporations that will either leave us in the lurch or bleed as much money out of us as they can.”
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