As we continue our economic recovery from the pandemic, it’s worth considering the promising strides Pennsylvania has made toward embracing the role that global technology companies will play in transforming our economic future. The technology revolution is occurring in every professional field including: health care, life sciences, finance, manufacturing and nearly every facet of our daily lives.
In recent years, Pennsylvania fell behind neighboring states like Virginia in attracting private investment from the world’s top technology companies. Since 2017, Virginia built over 200 enterprise data centers, created more than 45,000 new technology jobs, and averages more than $1.6 billion in annual data center development.
In the last decade, Pennsylvania has failed to attract the development of a single enterprise data center to our Commonwealth. What are Pennsylvania workers missing?
Technology companies invested $60 billion in 2019 alone to build new data centers across the United States, the single largest capital investment in the creation of new jobs made by any industry in the country. Pennsylvania missed out on every one of these economic development opportunities to rebuild our struggling communities, to put skilled construction trade unions to work, and to retain our talented technology workers to build our 21st century economy.
Pennsylvania has all the assets to compete for these technology jobs: a highly skilled workforce, diverse energy resources, and talented building trade unions who can construct and maintain these marvels of modern technology. However, our state was missing one critical component in this competition for 21st century technology jobs – a competitive tax policy that could attract global technology giants to Pennsylvania.
After being named chair of the Senate Community, Economic & Recreational Development Committee earlier this year, I hosted a series of statewide committee hearings to highlight the critical need for Pennsylvania to invest in its technology infrastructure and to stress the importance of advancing smart tax policies that attract private investment - tax policies like a sales and use tax exemption on the purchase of computer data center equipment that was used so effectively to position Virginia as a global technology leader.
A broad coalition of statewide building trade unions, tech industry leaders, and a bipartisan group of legislators quickly rallied around the ideas produced at our committee hearings, and forged a ground swell of support for building out Pennsylvania’s technology economy through responsible and effective tax incentives.
Earlier this summer, the General Assembly passed a sales and use tax exemption for computer data center development that Governor Wolf signed into law as Act 25 of 2021. The new bipartisan law sets Pennsylvania tax policy on a course to encourage billions of dollars in private investment that will unleash the creation of thousands of new jobs at data centers across the Commonwealth.
The bill represents a promising step forward in recognizing the considerable investments that technology companies have made in Pennsylvania over the last decade, and signals to investors that Pennsylvania is ready to do more to attract technology investment.
In the Pittsburgh region alone, recent data from the Computing Technology Industry Association found that the technology industry directly employs over 60,000 workers, with another 60,000 technical workers employed in industries across the economy. These numbers are a direct result of the hard work and ingenuity of local startups and entrepreneurs, and investments made by the world’s most successful technology companies right in our back yard.
Equally important, jobs driven by the technology sector are not limited to individuals with a graduate or even bachelor’s degree. While Pennsylvania is of course home to some of the world’s leading institutions of higher education, we’ve seen technology companies drive employment across all education spectrums of skilled employees.
Despite the political hostility and division that we often witness in Harrisburg and Washington D.C., it’s refreshing to see Pennsylvania’s legislative leaders come together in a joint effort to build a better economic future for all Pennsylvanians who seek to be a part of the global technological revolution.
Policymakers will continue to debate the role of technology in our lives, and rightfully consider the pros and cons of each new technological advancement. But at this critical economic juncture, as we look to emerge from a global pandemic, it is important Pennsylvania continues to encourage investments in our technology infrastructure and extend our partnerships with leading technological innovators.
The partisan extremists who often rail against Pennsylvania’s investment in technology companies do so for short-term political gain, but their opposition only serves to hamstring our economic recovery and results in Pennsylvania families being denied an opportunity at securing good, high-paying technology jobs.
If our economy is going to rebound stronger than ever, it will take all the tools in our economic toolbox to make it happen. Technology companies must be included in the pursuit of a better economic future for Pennsylvania. Great things can be accomplished when we set aside our partisan differences, and when we recognize the people of Pennsylvania want exactly what they deserve from their state government – a fair shot at economic opportunities that make their lives and their communities better.
Sen. John Yudichak represents Pennsylvania Senate District 14.