Moving Out

Posted by Jack

Is it time to pack up and head East? Some small companies in Southern California are moving logistics operations to Texas and other neighboring states to reduce overhead. (iStockphoto)

California is the great role model for America, particularly if you read the Eastern press. Yet few boosters have yet to confront the fact that the state is continuing to hemorrhage people at a higher rate, with particular losses among the family-formation age demographic critical to California’s future.

Since the recovery began in 2010, California’s net domestic out-migration, according to the American community survey, has almost tripled to 140,000 annually. Over that time, the state has lost half a million net migrants with the bulk of that coming from the Los Angeles-Orange County area.

In contrast, during the first years of the decade the Bay Area, particularly San Francisco, enjoyed a renaissance of in-migration, something not seen since before 2000. But that is changing. A recent Redfin report suggests that the Bay Area, the focal point of California’s boom, now leads the country in outbound home searches, which could suggest a further worsening of the trend.

Who’s leaving?

One of the perennial debates about migration, particularly in California, is the nature of the outmigration. The state’s boosters, and the administration itself, like to talk as if California is simply giving itself an enema — expelling its waste — while making itself an irresistible beacon to the “best and brightest.”

The reality, however, is more complicated than that. An analysis of IRS data from 2015-16, the latest available, shows that while roughly half those leaving the state made under $50,000 annually, half made above that. Roughly one in four made over $100,000 and another quarter earned a middle-class paycheck between $50,000 and $100,000. We also lose among the wealthiest segment, the people best able to withstand California’s costs, but by much smaller percentages.

The key issue for California, however, lies with the exodus of people around child-bearing years. The largest group leaving the state — some 28 percent — is 35 to 44, the prime ages for families. Another third come from those 26 to 34 and 45 to 54, also often the age of parents.

The key: Too expensive housing, not enough high-wage jobs

Our analysis? California is in danger of pricing itself out for moderate wage earners, and particularly families. Taxes, poor educational performance, congestion and signs of slowing growth are no doubt contributing factors. But the big enchilada in California — by far the largest source of distortion in living costs — is housing. Over 90 percent of the difference in costs between California’s coastal metropolises and the country derives from housing. Coastal California is affordable for roughly 15 percent of residents, down from 30 percent in 2000 and 30 percent in the interior, from nearly 60 percent in 2000. In the country as a whole, affordability hovers at roughly 60 percent.

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13 Responses to Moving Out

  1. RHT447 says:

    Hey! That stretch of road looks familiar. I we used that Penske truck too.

      • Lone Star says:

        Well boy howdy RHT447, and welcome, ifn’ y’all came this away.

        Jes shed any of them Cali habits forced on ya in the desert to die and blow away, ifn’ you would please.

        • RHT447 says:

          Well now, thet’s right neighborly of y’all, Lone Star. We jest might swing your way.

          As to any of them thar “Cali habits”, my ma a pa done shaped my habits ‘long about 1960, give or take. As for the rest, well, if you look close, and the lights jest right, y’all can still see where they made a big ‘ole splat mark on that there sign sayin’ yore now leavin’ Cali.

  2. Peggy says:

    Once known as the Golden State with streets paved with gold we’re now known for poop and needles covering those same streets.

    It’s not the just the people moving out it’s also vacationers avoiding our state and taking their kids to someplace safe/er. I hear even the movie industry moved to Georgia, at least for awhile. Guess they’re looking for a new location again.

  3. J Soden says:

    Buy stock in moving companies. They’re having a boom in their business heading East.

  4. Harold says:

    I am going to repost this here, it fits.

    It is not only Corporations leaving, but the very workforce that helps supported California’s economy as well, leaving behind the entitlement populatlation.

    But if your leaving be forewarned, California politicians are enacting some clawback laws, especially on real estate gains, so do your financial homework because same LiberaL politicians that are driving good people out of California are noting the exodus.

    And if you don’t take the required steps to avoid it, they’ll attempt to fleece you again.

    Not only Corporations but a very skilled workforce that helped supported California’s economy, leaving behind all the entitlement populatlation, and those that can’t leave.

    “Yes people are leaving, good people, entrepreneurs and big corporations, even middle class that contributed to and created jobs or paid taxes. Sadly it not because they want to leave, they are being driven out by the failed ideology of far left socialist liberals in charge of California today.

    So the question might also be , how is California going to replace that major source of tax revenue, and who next on their list is going to pay for their socialist programs that don’t equally favor all classes of their citizens.

    My thinking is they don’t know or even care yet, and will only create more and higher taxation on any viable industry left, maybe the left leaning film industry is going to step up.

    But when you get down to the majority of their remaining citizens, how do you tax the people you solicited and created, and then pay for programs that favor a majority of people on social programs. It’s going to be hard when you don’t have others weath to redistribute isn’t it.

    The model of decay called Detroit does not seem that far off for California’s future.”

    • J Soden says:

      When we left Taxifornia in 2000, the DMV snatched our $225 state tax refund for vehicle registration they claimed we owed. We had already licensed all our vehicles in NV, which they could’ve found out with a simple VIN run. After 3 times submitting our proof of NV residency to DMV with a list of ALL of our vehicles with valid NV registration with no response, we had to write to The Governator to get our $$ back.

      And then they did it again 3 years later snatching $400 out of the one remaining $$ account we had in Taxifornia – on a vehicle that we had sold 2 years previously! Again, we had to write to Gray Davis to get our $$ back.

      Moral of the story: Don’t leave any $$ behind in Taxifornia or the DMV or other state office will confiscate it. And make a personal appearance at the DMV with written proof of all vehicles re-registered elsewhere to prevent bureaucratic hassles.

      • Libby says:

        Eighteen years and you’re still not over it? Get over it. Furthermore, it sounds suspiciously like NV was the culprit. How is CA supposed to know you’re re-registered, if the re-registering state don’t report it? You don’t wanna pay taxes … you don’t get services. That’s what you get for moving to an economic backwater.

        Me, I just paid my vehicle reg ONLINE ! … oh, joy … oh, bliss. Now, we’ll just see if the tags show up.

    • Libby says:

      “… leaving behind the entitlement populatlation.”

      You mean you and Jack !

  5. RHT447 says:

    And the hits just keep on comin’.

    “High-speed rail route took land from farmers. The money they’re owed hasn’t arrived”

    “California moves to let felons serve on juries”

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