Data centers are preventing a US recession, NMSU economist says
Data centers are preventing a US recession, NMSU economist says
Despite a weak housing market, data center growth has buoyed the US economy, New Mexico State University economics professor Chris Erickson tells KOAT.
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Data centers are preventing the U.S. from falling into a recession, a New Mexico State University economic expert told KOAT on Saturday.
“Data centers are keeping the economy growing at this point; they are the main drivers of the economy,” said Chris Erickson, a professor of economics at NMSU.
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“Its investment in data centers has kept the economy buoyed up. The housing sector has been quite weak for a while. Usually when the housing sector is that weak, you can expect either slowdown or even a recession to follow that because construction is such an important source of jobs. But because the data centers have taken up all the slack in construction, that hasn’t happened,” Erickson explained.
Data center growth in New Mexico is not uncontroversial, and Erickson said he believes there could be a slowdown in new data center development. The controversy surrounding them might make it difficult for companies to secure funding for new projects, he said.
Three New Mexico counties have placed moratoriums on data center development, and a fourth is currently considering one. Democratic lawmakers in Santa Fe are proposing a statewide moratorium for the 2027 legislative session.
Opponents are wary of the environmental impacts and financial costs of data centers.
Still, there are major data centers currently operating or in development across the state, including an operational Meta data center in Valencia County and a major Oracle data center under construction in Doña Ana County. Google is also exploring a potential site in Lea County.