Do Data Centers Deliver on Job Creation Promises in West Michigan?
Remember when Switch moved into the Pyramid building in 2015 and promised to create 1,000 new jobs by 2026? Each data center project brings lofty promises of job growth, including the projections by Switch, but Michiganders have heard these promises before.
We know that the construction of data centers creates temporary jobs for contractors, but what about permanent, full-time jobs for local residents?
Switch Data Center Jobs in Grand Rapids
In 2017, Switch reported that more than 700 people have been employed for construction and site development. But as of 2023, Switch only has 26 permanent employees at the Pyramid in Grand Rapids, far from the 1,000 jobs they projected with salaries ranging from $60,000-$100,000.
“Those temporary jobs are kind of long term temporary jobs,” Gaines Charter Township Community Development Director Dan Wells said.
In 2019, Switch did not respond to questions about its transformational promise regarding how many of the projected jobs would be permanent employees or temporary contractors. Switch is required to report its job creation numbers to the Michigan Economic Development Corporation annually, but we were unable to find data for 2024 and 2025 on the MEDC’s website.
Back in 2015, Governor Rick Snyder signed legislation that exempted Switch and all co-located data centers from sales and use taxes. Switch demanded these tax breaks, and local nonprofit The Right Place also pushed for them. Then CEO of The Right Place Birgit Klohs called the Switch data center an “incredibly game changing project.”
To receive these tax benefits, Switch had to create at least 400 new jobs in Michigan by 2022 and 1,000 jobs by 2026. Switch initially created 43 jobs in 2023, but 17 of those jobs were transferred to other locations, leaving only 26 permanent jobs remaining in Grand Rapids.
Do data centers deserve state tax exemptions when they only deliver on 2.6% of their projections?
Data Center Sales and Use Tax Exemptions in Michigan
New data center sales and use tax exemptions were signed into law in January 2025 by Governor Gretchen Whitmer and extended until 2050. Data centers can qualify for these sales and use tax exemptions by creating only 30 new jobs with an annual wage of at least 150% of the prosperity region median wage, which for West Michigan is about $40/hour.
If promises of major job growth are being made, why are the requirements so low?
Data Center Property Tax Benefits
Qualified data centers are also not supposed to receive local property tax benefits unless voted upon by the township, although FOIA documents reveal initial discussions of a potential 50% reduced tax rate for the hyperscale AI data center in Solon Township. The project has an estimated cost of $1 billion.
Not only have we heard these lofty job creation projections from data center projects before, we’ve also heard them from The Right Place.
The Gotion battery plant project near Big Rapids was projected to create 2,350 jobs. The Right Place was quoted in 2022 saying they’re “honored to have played a role in bringing this transformational project to the Big Rapids area.”
$23 million dollars from the MEDC’s Strategic Site Readiness Program was disbursed through The Right Place to prepare the land in Mecosta County for the new plant. After five board members from Green Charter Township were recalled and the project abandoned, Gotion is refusing to pay back the $23 million in state grants it received.
Rural Communities Push Back on Proposed Hyperscale AI Data Centers
On February 12th, The Right Place launched its three-year strategic plan, where CEO Randy Thelen addressed the pushback townships are receiving on data center projects. He said they’re trying to “find ways through this moment of anti-growth where we can continue to welcome investment.”
Are the residents who oppose having a hyperscale AI data center in their backyard really “anti-growth?”
Or are they rightfully skeptical of the promises being made?