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The lucky 200

January 25, 2008

Behind a tightly guarded barbed-wire fence, Google's new $600-million data-center complex in Lenoir, North Carolina, is rapidly taking shape, reports the Charlotte Observer:

At the 220-acre Google site, past, present and future coexist. More than 300 construction workers, many from local contractors, have transformed a hill into more of a mountain, moving vast quantities of earth. The surrounding neighborhood, meanwhile, looks much as it did before, with a mix of modest homes and largely shuttered furniture factories. The Blue Ridge Mountains and snow-capped top of Grandfather Mountain loom in the distance.

The first data center has risen at the base of the hill, along N.C. 18, with large cooling units at the side. It's on track to begin limited testing this spring and should be fully up and running by the end of the year ... Google is also excavating the pad for the second building, which is expected to begin operating in 2009.

The company, stung by criticism about the rich tax breaks it wrangled from state and local governments, has been doing a great deal of outreach to ensure good community relations. It's brought in a former Vermont politician, Matt Dunne, to chat with residents about its plans, helped a nearby community college develop a new course of study in information technology, and donated Christmas trees for a holiday display. Google's high-profile investment in the town, which has been depressed since the exit of the big furniture makers and other manufacturers that were once the mainstays of a thriving local economy, has boosted people's morale and given them new optimism about the future, reports the paper. The mysterious new buildings rising near the state highway are a big source of pride for the beaten-down community.

What they won't be, however, is a big source of jobs. Once the construction of the server farm is complete and the work crews leave the site, the actual number of people that Google will employ in Lenoir will be modest. Unlike the old furniture plants, which provided well-paying jobs to many thousands of workers, only about 200 people will end up working in the vast but highly automated Google complex, though the lucky 200 will enjoy all the famous Google perks:

The company's Lenoir offices will look "good and Googly," Dunne said, with bean-bag chairs, lava lamps and a massage chair. A foosball table is already in use in the temporary trailers behind the first data center building. Employees will also receive free food, incentives to buy hybrid cars and to buy homes in Lenoir, and either an on-site gym or subsidized gym membership.

No matter how pampered, such a small cadre of workers won't in itself be enough to turn around Lenoir's fortunes, as Google itself is quick to point out. "We're not here to save the town," the company's local operations chief, Tom Jacobik, told the Observer. "We're here to run a business."

It's a business that bears little resemblance to the manufacturing businesses that spurred the growth of the middle class during the last century. The great plants of the information age are being engineered to run with a whole of computers but very few people.

Comments

Job creation is an area that leaves many economic development agencies struggling to sort out the benefits of data centers. Yahoo and Microsoft have hired about 50 full-time workers apiece at their new data centers in Washington, which in light of Google's 200 jobs per facility, has prompted some discussion in the industry about Google's numbers.


There's been an active debate among public officials in Old Bridge, New Jersey, where there's been a proposal for a $1.4 billion data center campus. Job creation is usually the benchmark in evaluating economic development projects, and some Old Bridge officials have noted that data centers have had limited impact in other NJ towns. But others like the fact that data centers are ratables that don't clog the roads or schools.

Posted by: RichM [TypeKey Profile Page] at January 25, 2008 09:50 AM

Note "bean-bag chairs, lava lamps and a massage chair" are image, not pampering.

I'd much rather be pampered by having a Herman Miller Aeron Chair - have you ever tried to type while sitting in a bean-bag chair?

And why do people make a big deal over a foosball table? It's not an expensive or exotic object. It's like going gaga over a TV in a employee lounge.

"free food, incentives to buy hybrid cars and to buy homes in Lenoir, and either an on-site gym or subsidized gym membership." are good stuff, but we don't know the details, and there's a lot of room for play there.

But, more seriously, I think this is like farming - the problem with "factory farming" is not that the industrialization of farms mean they could now run with very few hired hands. It was how the productivity improvements thereof were spread around - or not - to the general economy.

Posted by: Seth Finkelstein [TypeKey Profile Page] at January 25, 2008 10:15 AM

Since the former furniture town where they put their haunted data center obviously does not have a large labor pool of techies, most of the lucky 200 will probably we guest workers like H1B or L3 transfers rotated from outside the state. They will probably live on site and not even pump rent money into the local economy. Of course, the gardener, security guard and the janitor might be local. Now there are some jobs for the 21st century worthy of a $300/share company!

Posted by: Linuxguru1968 [TypeKey Profile Page] at January 25, 2008 07:34 PM

Yes, but if we believe the Big Switch then the rise of Google and the World Wide Computer can be compared to the build-out of infrastructure in the electric age.

And just how many people did your average hydro electric station employ?

The point with infrastructure like this is that it creates opportunity and employment throughout the reach of its network. Just like electricity. There's nothing to stop the people of Lenoir writing code for the network and profiting, albeit indirectly, from the data centre in their backyard.

Posted by: whiteheron [TypeKey Profile Page] at January 25, 2008 08:40 PM

whiteheron:
>> can be compared to the build-out of
>> infrastructure in the electric age.
Seems more reminiscent of the massive overcapacity fiber-optic build out circa 2002. I'd still like someone to show me that infinite supply guarantees infinite demand.
>> And just how many people did your average
>> hydro electric station employ?
Hydro electric plants have parts that wear out and require physical maintenance. These haunted Krell data centers are pretty much self maintaining. I don't see them generating the kind of jobs that power utilities do.
>> There's nothing to stop the people of Lenoir
>> writing code for the network and profiting
What kind of code? A new router OS? Due to the software as services model, no one really "sells" code anymore – only sell services. They might be able to develop a service to deliver over the web – until someone else copies it and steals their customers!

Posted by: Linuxguru1968 [TypeKey Profile Page] at January 25, 2008 11:09 PM

George Dyson, beanbag chairs, and "free" food has me wondering if there will be a data center plunked down in Grover's Mill, N.J.

-t

Posted by: Tom Lord [TypeKey Profile Page] at January 26, 2008 01:58 AM

Tom Jacobik is correct. Google is not there to "save the town". Why do these communities think otherwise?

Google places these data centers in non-urban environments for many reasons. Job creation is not one of them. Yet as Whiteheron notes, the Net is the environment that can spur job creation everywhere. I agree. That said, young people that stay in these communities are seldom contributors to such "growth". Most American small towns are analog in culture and the digital tsunami of the coming "Big Switch" renders them irrelevant.

mike whatley
altadenam, ca

Posted by: Mike Whatley [TypeKey Profile Page] at January 26, 2008 01:39 PM

>> beanbag chairs, and "free" food has me
>> wondering .....

Netscape was the same way circa 1996 - you could even bring your pet to work. Now, Netscape is just a few offices at AOL. It just part of the "window dressing" for these kind of scams ....

>> Google is not there to "save the town".
>> Why do these communities think otherwise?

IMHO, it goes deeper. The purpose of the corporation is not the re-distribution wealth. The purpose of a corporation is to provide products and services NOT employ people making money for the stockholders. I still don't understand why people think a corporation’s purpose is to employment. Its not. Employment is just a side-effect that in order to produce product and services they are going to co-incidentally employ people. Tweaking it to just employ people is called socialism and it’s alive and well at the US Pentagon.

Posted by: Linuxguru1968 [TypeKey Profile Page] at January 26, 2008 02:18 PM

@linuxguru1968

Tired old debates about socialism and your reducing it to "just emply people" misses a larger point.

Especially in a globalized economy, holders of dollar-denominated assets have a strong self-interest in the economic health of workers in the U.S.

Obviously it should work like "Well, Google touched the town last so they're holding the bag." That's not the point.

The overall trend of under-investment in real domestic productivity: that is the problem.

-t

Posted by: Tom Lord [TypeKey Profile Page] at January 26, 2008 04:08 PM

TomLord:

>> Tired old debates about socialism and your
>> reducing it to "just emply people" misses a
>> larger point.

No. I said people’s misconception that the corporation is designed to redistribute wealth through employment was wrong. I'm not a socialist, so I cannot comment on how it operates. People seem to be giving Google, Intel and Microsoft all these "perks" under the misconception that they are creating jobs for which they can compete. I think they are mistaken.

>> Especially in a globalized economy, holders of
>> dollar-denominated assets have a strong self
>> -interest in the economic health of workers
>> in the U.S.

Sure. As consumers. But, as workers, corporate is looking for the cheapest worker it can find. Beyond basic paying enough to cover basic needs like shelter and food, corporate is not really overtly interested in spreading out the wealth. In the US, after age 30, the interest is almost non-existent.

>> The overall trend of under-investment in real
>> domestic productivity: that is the problem.

Duh! If you go to the store and look at the back label of all most all items, you will see "Made in China". As long as corporate can get a better deal putting production in cheap labor countries like China or India what is the incentive to invest here and pay living wages? If you can get a accountant in India for $300/month why spend $100K/year in New York? Or a textile worker for 50 cents/day in Bangladesh, why invest here?

Posted by: Linuxguru1968 [TypeKey Profile Page] at January 26, 2008 05:52 PM

People seem to be giving Google, Intel and Microsoft all these "perks" under the misconception that they are creating jobs for which they can compete. I think they are mistaken.

Ah. Yes, I totally mis-read you and you make a point that I agree with.

But, as workers, corporate is looking for the cheapest worker it can find.

Yeah, that's a strategic error. "Real productivity" (the definition of which we can haggle over) is important.

Your last 'graph ("duh [....]") is the title for a good round-table to have with people unlikely to actually show up for the event :-) :-(

-t

Posted by: Tom Lord [TypeKey Profile Page] at January 26, 2008 07:48 PM

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