The Human Factor: The Most Underrated Risk in Data Center Growth (Part 2)

People risk is no longer confined to hiring. It's now shaping how data centers are built, commissioned and operated. As workforce gaps widen, people risk is emerging as a critical factor influencing delivery timelines, cost structures and operational resilience across the data center lifecycle.

Site selection: Workforce as a strategic variable

Site decisions are driven by power access, tax incentives and connectivity. However, even at the earliest stage, workforce availability is a critical factor in site selection. Locations with strong infrastructure but limited labor pools introduce hidden risks.

Construction: Workforce mobilization at scale

During the construction phase, workforce requirements are at their peak. Projects operate at a scale more akin to small cities, something many organizations are still adapting to.

Managing thousands of workers, sometimes across multiple trades or even in remote or emerging markets, requires proper workforce planning and coordination. At the same time, with competition intensifying, labor costs are rising rapidly, further pressuring project economics.

Commissioning and transition: The role of experience

As facilities near completion, the nature of people risks shifts. The focus moves from workforce volume to capability, particularly the availability of experienced leaders and specialists to manage complex commissioning and ensure knowledge transfer.

Gaps in continuity at this stage can compromise operational readiness and long-term performance.

Operations: Lean teams, high dependency

Once operational, data centers rely on relatively small on-site teams, numbering dozens rather than hundreds.¹ These teams, however, are highly specialized, covering areas such as HVAC systems, power infrastructure, IT deployment and security.

This creates a new risk. Because teams are lean, the loss of even a small number of critical employees can disrupt operations.

Growth and scale: Organizational maturity

When operators expand portfolios and scale across regions, organizational complexity often increases. Workforce strategy needs to evolve beyond hiring to encompass leadership development, organizational design and scalable HR infrastructure.

Without this, rapid growth can outpace the organization's ability to manage itself effectively.

From turnover to strategy: Rethinking workforce in data centers

If hiring is a visible challenge in the data center sector, retention is a more complex and costly one.

Despite strong compensation, turnover remains high across data center jobs. Approximately 40% of professionals are considering leaving their roles,² and early-career attrition is acute.

The reason is clear: pay alone is no longer enough. "People join companies for compensation and benefit programs. But they stay because of culture, growth and a sense of purpose," explains Russell Paape, area vice president at Gallagher.

"Across industries, significant factors influencing retention are a clear growth trajectory, a strong organizational culture and trust in leadership," adds Heather Haseman, area vice president at Gallagher. "Organizations must focus on fostering a culture of trust, providing leadership support and communicating career growth opportunities to keep employees engaged and committed."

Among younger workers, retention is particularly challenging, with only 18% staying beyond their first year.³ The result is an expensive, disruptive and unsustainable cycle of turnover.

"The younger generation wants to understand how they fit into the organization and how they can make a broader impact," says Haseman. Employees are far more likely to stay when their progression within the organization is clearly mapped out.

Organizations need to place greater emphasis on what the first couple of years of an employee's experience look like, rather than focusing only on retention. By addressing this early stage, they can build a stronger foundation for long-term retention.

Rising expectations

Today's workforce places greater value on flexibility, wellbeing and purpose alongside traditional compensation. Dissatisfaction is often driven not by base pay, but by opaque bonus structures, limited benefits and unclear progression pathways.

This requires employers to shift from viewing compensation as a standalone lever to treating total rewards as an integrated experience.

An unsustainable model

Data center employees cite burnout, limited career development and insufficient total rewards as key drivers of attrition. Many aren't leaving the industry, but moving between employers in search of better conditions.

This creates a cycle of poaching that pushes up costs without expanding the overall talent pool.

Reliance on hiring from competitors is a short-term fix. Industry-wide, it's adding to higher turnover, rising labor costs and underinvestment in long-term talent development.

"If we continue on this path, at some point, there won't be enough people to design, deliver and maintain data centers," says Russell Paape. "To address this, some companies are investing in local high schools, trade schools and other programs to offer students specialized knowledge they'll need when they are employed."

Solutions lie within the right partnership

Effectively managing people risk requires visibility and coordination across every stage of the data center lifecycle.

Gallagher partners with organizations to assess workforce risks early, strengthen operational resilience during delivery, and support scalable growth strategies. Through this integrated view of risk management and resilience building, organizational leaders can anticipate challenges, protect performance and deliver projects with greater confidence.