Well, the Texas construction industry has immense work to look forward to, as per an analysis by a Texas-based construction aggregate supplier named Twisted Nail.
The company went ahead and evaluated the national as well as state-level data coming from the U.S. Census Bureau and ascertained that Texas leads the nation when it comes to commercial construction expenditure at almost $90 billion per year. This is more than double as compared to any other state.
This sort of consistent vitality of the construction industry in the state is throttled due to federal incentives, manufacturing investments, and low state taxes, as well as population growth, along with clean energy, semiconductor, and advanced manufacturing projects that comprise much of that activity.
Moreover, the good news comes from the U.S. Bureau of Labor Statistics, which happens to project almost 6% growth for skilled trade workers all through 2034 and even more levels for other construction workers.
This indeed happens to be quite encouraging given how the construction sector employment has been a flat line all across the country for the past six months that led to August 2025.
It is well to be noted that the boom in the data center development is an especially bright star as far as the construction in Texas is concerned.
Interestingly, one of the largest and most interesting data facilities that is planned is the 50,000-acre data center hub built near Laredo that is dubbed the Data City, Texas, as announced by the Energy Abundance Development Corporation based out of Houston this March 2025.
As per the company in a news release, Data City offers a very distinct solution, attaining the holy grail of clean energy ambitions from hyperscalers, offering low-cost 100%, 24/7 green energy at scale.
Although Data City has been powered by Texas-produced natural gas initially, it proposes to transition to green hydrogen that’s sourced from the adjacent 2 TWh Hydrogen City salt dome storage facility of the company. Wind and solar, as well as batteries, are also part of the plan. In such a way, Data City is going to be completely self-powering and also isolated from the state’s energy utility, ERCOT.
It is worth noting that the Data City is going to be built in phases, with the very first 300 MW and one million square feet of data center space all set to be launched in 2026, and could very well expand fast to 5 GW and more than 15 million square feet of leasable space, as per the announcement.
Apparently, even more ambitious happens to be a $300 billion AI campus located near Amarillo, Texas, named HyperGrid, which is planned by Fermi America. If plans go ahead, the 18-million-square-foot facility could very well go on to generate 11 GW of IT capacity, which would be powered by a combination of solar, wind, natural gas, and nuclear energy, thereby making it the largest energy and data complex in the world.
Notably, Texas is getting a good chunk of the $375 billion forecasted by UBS, the investment bank, which is going to be spent throughout the world in 2025 on the AI infrastructure. Almost $500 billion of data center investments happen to be projected in 2026 and a probable $3 trillion by 2028. As a matter of fact, almost 20 data center projects happen to be underway or planned across the Austin area only.
Importantly, the smaller rural communities get excited with regard to the economic prospects that happen to surround the new data centers in Texas that are proposed for their area. But while massive data centers lead to short-term construction jobs and, at the same time, add revenue to the local municipal tax rolls, the longer-term employment picture is not that rosy. Completed data centers do not need a high number of long-term workers.
As reported by the Wall Street Journal, there are around 1,500 people, which includes the likes of site workers and electricians as well as engineers, who are apparently involved in the Stargate Project’s data center construction by way of covering almost 1,100 acres near Abilene in Texas. The Abilene facility happens to be a $500 billion nationwide AI infrastructure venture that involves OpenAI, Oracle, and SoftBank, as well as MGX, which is an investment firm.
But the economic development agency of Abilene says that the Stargate facility is going to hire only around 100 full-time employees, a very small number of people who might work in a similarly sized commercial development such as an office park, factory, or even a warehouse for that matter.
Nonetheless, the booming data center market happens to be very good news for the building industry should there be other areas of construction across Texas that take a pause because of economic uncertainty.
Even if the planned facilities do not get built, data center expansion is most likely going to continue because of demand.
As per a global commercial real estate and investment management company, Jones Lang LaSalle, vacancy rates within the existing data centers happen to be at a record low of 2.3% across the U.S. and virtually zero when it comes to Texas. There is an element of strong preleasing through 2027, which is anticipated to keep the vacancy rates at lower levels.
But this isn’t all very hunky-dory. The Texas data center development future happens to be somewhat contingent on the availability in terms of power as well as water.
It is well to be noted that the data centers in Texas made use of almost 22 million MWh of electricity in 2023, which is 4.6% of the state’s electricity consumption. ERCOT happens to anticipate that by 2031, the state grid is going to require more than double its 2024 capacity, majorly because of the growth of data centers. This suggests the significance of new data centers having self-powering capacity.
What looks more challenging is the water supply that is needed to cool the processing servers, thereby amounting to millions of gallons per day for each facility. In a state which is often jolted with drought conditions, this could lead to conflicts between proposed data centers as well as agricultural and industrial users along with residential communities.
Coming up with new data centers may be important to the future success of the construction industry of Texas. But the limited long-term and large-scale employment potential, in addition to the power generation that’s needed and water supply demands, present complex realities which need to be recognized in the years to come.
