How many jobs are leaving CA?

The supposedly large number of companies high-tailing it to other states has been a reliable rallying cry among pro-business groups who insist that California politicians and regulators aren't friendly to their kind. Trouble is, the statistics have not backed up the rhetoric. The Public Policy Institute of California Entering just released a study that found the state lost, on average, a paltry 9,000 positions a year between 1992 and 2006, or 0.05 percent of labor force. That works out to 25,000 jobs leaving and 16,000 coming. The data doesn't reflect the impact of the just-ended recession, but it does cover two other recessions, as well as two booms. Jobs leaving the state never rose above 2.3 percent of total job losses in any given year, said the report. That makes a pretty compelling case that the concerns have been much ado about not much.

Very few California businesses can relocate to another state without having to replace most of their workforce, making relocation out of (or into) California more costly than in most other states. Of course, because California is the most populous state, more businesses move out of (and into) California than out of (and into) most other states, in absolute terms; but as a share of total job losses, job displacement resulting from establishments leaving the state is less common in California than in most other states.

Not everyone is signing off on the PPIC findings. Irvine relocation consultant Joe Vranich says "the report is so deficient that if I were running PPIC, I'd order it pulled off the Internet" (it's still up there). From Vranich's blog (h/t OC Register):

The pace of businesses disinvesting in California has accelerated. In a period just shy of the first three quarters of this year, 144 companies have engaged in California Disinvestment Events - nearly three times the level detected for all of 2009. Quite clearly, the exodus of businesses out of California continues. It makes sense for companies to reduce their California footprint considering the ample supply of attractive, lower-cost alternative locations. Unless California reduces its hostility toward business, we will see more commercial enterprises seeking friendlier locations in which to relocate entirely or at least place facilities there that used to be located here.

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Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
Mark Lacter, business writer and editor was 59
The multi-talented Mark Lacter
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