More than 100 years ago, steel helped transform Pittsburgh into an economic powerhouse, an engine of prosperity.
Now, business leaders and elected officials are banking on artificial intelligence doing the same.
The stakes are high. AI is already transforming industries from health care and finance to aerospace and defense. And state and local governments across the country are now racing to position themselves at the center of the emerging technology — and capture the economic promises that come with it.
By one estimate, AI could contribute more than $15 trillion to the global economy by 2030.
At a joint hearing of the Senate and House planning commissions last month, Republican lawmakers and local business leaders discussed the challenges Pittsburgh faces in attracting AI companies to the region — but also highlighted its unique advantages:
Top-tier universities and research institutions on one hand, and vast natural gas reserves to power data processing centers on the other.
“We’ve got the jockeys here. We’ve got the top research institutions. We’ve got the data,” said Joanna Doven who leads an AI Strike Team that has set the ambitious goal of attracting 100,000 tech jobs and additional AI companies to the region.
Pittsburgh already boasts a small tech sector and growing AI industry, epitomized by a one-mile stretch of road near Bakery Square dubbed "AI Avenue" that is home to several tech giants, including Google, Duolingo and the Carnegie Mellon University Cloud Lab.
For companies starting out, however, the city might be more of a launch pad than a landing pad.
Over the past 15 years, one company after another got started in the Steel City only to relocate or expand out of state.
Mach9 Robotics, which develops AI-powered map making software, spun out of CMU in 2021 and initially set up shop in Bloomfield. But it moved to San Francisco last year after securing more than $12 million in venture capital funding.
AI software startup Solstis, founded by graduates from CMU and the University of Pittsburgh, is expected to join them to be closer to their lead investor, Afore Capital.
Agility Robotics, whose co-founders met at Carnegie Mellon, still has a small office in Lawrenceville, but the company chose a site 2,600 miles away in Salem, Ore., to build its manufacturing plant — a 70,000-square-foot facility that is expected to employ 500 workers.
“We have these strengths, but we’re not commercializing these strengths into jobs,” Ms. Doven said.
Federal funding cuts can reduce startups
To change that, business leaders say state and local governments need to double down on programs and policies that help startups grow here, including federal funding for research and development, private-public partnerships, tax credits and investments in infrastructure that improve the quality of life in the region, including public transit.
Earlier this year, Hellbender, a Pittsburgh-based company that manufactures AI-powered smart cameras, announced it was moving back into the city, in part to make it easier for employees to commute to work. The company was struggling to build out its workforce at its plant in Harmar, said CEO Brian Beyer.
The announcement came days before Pittsburgh Regional Transit proposed major cuts to public transportation, citing a lack of state funding.
“I wince every time I read in the Post-Gazette that the bus routes are changing, and we’re shrinking services from [PRT],” Mr. Beyer said. “We should be doing the opposite. We should be increasing our public transportation, increasing our bikeways through the city.”
Recent cuts to National Institutes of Health funds are another major concern.
In March, the NIH terminated 10 research grants for the University of Pittsburgh, which were valued at $16.2 million, the Post-Gazette reported last week, bringing the university’s total loss in federal research dollars since February to $44.7 million. Pitt also lost $3 million in research funding from the National Science Foundation in recent weeks and $25.5 in research funding in February when the U.S Agency for International Development was shuttered.
“Protect America’s seed fund, protect the small business innovative research grant and the small business tech transfer research funding tools that are available through the Department of Defense, the Department of Energy, Department of transportation … Protect the NIH funding,” Mr. Beyer said. “If you dry those up, if you just attack that research funding, then you are reducing the lifeblood of a lot of these startups, especially the startups that directly came out of Carnegie Mellon and Pitt.
“One of the results of reducing that funding will be a reduction in the number of small businesses that spin out of our universities in Pittsburgh.”
Doing what no one else is doing
Ms. Doven said the AI Strike Team is also busy luring venture capital funds — largely concentrated in Boston, New York and San Francisco — to the region.
At the same time, policymakers are exploring ways to make it less expensive for AI-based companies to grow locally by cutting operating costs.
One of the biggest is computing power: the processing capacity required to run and train advanced AI models, which often demands specialized hardware and enormous amounts of electricity.
The AI Strike Team is working with key stakeholders, including state lawmakers and data center operators, to craft a “competitive compute” policy aimed at reducing those expenses for companies that choose to grow in Pennsylvania.
Ms. Doven could not share details about the proposal until it is finalized, but said a plan to lower computing costs for AI companies would set Pennsylvania apart from other states competing to attract AI companies and investors.
“If we can incentivize companies through ensuring they have competitively priced compute, we’d be doing something that no one else is doing,” Ms. Doven said.
Another asset lies beneath our feet: the Marcellus Shale, the largest natural gas reserve in the country.
AI relies on powerful, electricity-hungry data centers to store and process massive troves of information, contributing to a surge in energy demand.
Over the past decade, the amount of electricity consumed by data centers across the country has more than tripled, according to a recent study from the U.S. Department of Energy. That amount could triple again in the next three years.
By 2028, data centers are projected to consume up to 12% of all electricity used in the U.S. — more than any other energy-intensive industry, including steel and aluminum production.
At the national level, President Donald Trump is responding to rising power demand by rolling back environmental protections in a bid to boost coal production — a move that undermines global efforts to lower carbon emissions.
Citing the energy needs of AI, the president earlier this month signed a series of executive orders weakening emissions standards for coal-fired power plants and fast-tracking mine permits on federal lands.
In Pennsylvania, lawmakers and industry leaders are already using the state’s vast energy resources — and promises of cheap, reliable energy — to lure data center operators to the region. Since January, three data centers have been announced in Western Pennsylvania, all expected to be powered by natural gas — TECfusions in Lower Burrell, Fort Cherry Development District in Washington County and a sprawling complex at the former Homer City Generating Station.
Ms. Doven expects that increasing investments in Pittsburgh’s tech sector, reduced operating costs for AI-based companies, and a burgeoning data center industry will rebrand Pittsburgh as a center for innovation and growth on par with Silicon Valley and Austin, Texas.
“When you go to South by Southwest or you go to New York or Silicon Valley and you say you're from Pittsburgh, people look at you and are kind of shocked,” she said. “Why Pittsburgh, right? And so I think what needs to happen — and what the Strike Team is focused on — is putting out AI signals that communicates in a sort of wow factor way that the Pittsburgh region is open for business.”
First Published: May 4, 2025, 8:00 a.m.
Updated: May 5, 2025, 6:44 p.m.
