California: Bad for Business

Looking for a business-friendly state? You had better skip California. Extensive regulations, high taxes, and high worker’s compensation rates have made California unappealing for resident and out-of-state businesses alike in the past two years. However, according to the business relocation coach, 2010 marks an economic “emergency” as there have already been 84 instances in California of companies either closing their factories, moving their headquarters out of state, or investing heavily in another out-of-state location. This nearly doubles the 2009 total of 44 instances, and more than doubles the 2006-2008 total of 35. California is losing its economic luster at an alarming rate, which does not bode well for job seekers.

Some of the companies moving or hedging their bets by shifting operations elsewhere include Google, Apple, Genentech, Facebook, and Hilton. Orange County, Los Angeles, and Santa Clara counties have suffered the most in 2010 with 25, 19, and 16 company moves respectively. Santa Clara in particular houses some of the big tech names like Google, Hewlett Packard, and Apple. In 2009, Los Angeles had the largest number (and the only county in double digits) of company moves with 12. California is not only losing out economically, but it is also losing some of its character as the technology-hub of the US.

This exodus follows recent trends emerging during the recession. The states benefitting most from California’s high taxes and strict regulations include Texas (with 18 events), Colorado (17 events), Arizona (11 events), Nevada (10 events), and North Carolina (10 events). Increasingly, these states have established themselves as promising havens for job seekers and have fared better during these tough times.

The state that once drew thousands of hopeful migrants during the Great Depression is now stifling growth opportunities. This is a bleak and unfortunate reversal, particularly for a place struggling to stay afloat in the recession.


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this was a good informaation

I never knew that california has a high taxes and high worker's compensation rates this is good for california but not too much for the company or businesses. Good article has a lot of information.

Maybe California should hire

Maybe California should hire Bradley S Cohen to offer some advice on how they could turn things around. The state has already lost some major companies. Do they want to go down that route?

There may be (and likely is)

There may be (and likely is) a correlation, but it seems to me that (1) consumer demand to live in these cities and (2) the availability of credit both play greater roles than planning initiatives (the little game you pointed to sorta hinted at this second point).

It's about time...

California could stand to lose a little of that "economic luster".

For almost all of my 50 years as a California native, I've lived with the crushing growth that came with the economic boom times of this state. I've seen some of the world's richest farmlands that were here in the Bay Area get plowed under for suburban sprawl and high-tech industrial development. I've been priced out of ever owning my own land due to the ridiculous housing speculation of the past thirty years. I've grown up here with a constant flux of strangers moving in and out of the neighborhoods I've lived in, people who have had no stake or desire to build a community.

In all, these boom times have not provided a balanced growth situation for this state, but rather a continuation of the irrational, ill-planned growth policies similar to what my earlier relatives experienced during the gold rush.

To say that "stifling growth opportunities" is "a bleak and unfortunate reversal" shows your true colors: growth is good for the sake of growth and money. Sustainability, balanced growth - all are useless ideas when it comes to making a buck. Contradictory opinions on an urban-planning blog such as this!

If a recession causes people to leave here for gold-digging opportunities elsewhere, I say let them go! Those states can have their own boom-and-bust cycles, as those "growth" corporations will ultimately move on to even more "business-friendly" areas like China and SE Asia.

Now if we can only convert some of that ugly Contra Costa housing back into pastures and farmland....

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