California, net exporter… of residents

posted at 8:41 pm on March 4, 2013 by Erika Johnsen

Pro golfer Phil Mickelson found himself in a heap of PR trouble for having the audacity to tell the simple truth about his motivations for looking for an out from California’s onerous tax-code additions, and he isn’t the only upper-income earner thinking about pursuing mitigating financial options — but the bulk of the mass exodus from California in recent years hasn’t actually been comprised from members of the wealthier echelons. A net 3.4 million people have fled California over the past two decades, largely including the young and the restless because of the lack of jobs and affordable living situations — which could quickly be trending towards an accelerated demographic crisis for the heavy welfare state, said Conn Carroll over the weekend:

According to a 2012 University of Southern California study on state demographics, you have to go back to the early 1990s to find a time when more Americans were moving to California than leaving it for other states. Thanks to high housing prices and a weak job market, California is now a net exporter of U.S. citizens to other states.

As a result of this shift, native Californians became a majority of the state’s population only in the last decade. Their numbers will continue to rise. And since foreign immigration is also expected to level off, the report predicts growth will occur “almost all among native Californians, many but not all of whom are the children of immigrants.”

Unfortunately for California, this local-born population is not increasing fast enough to replace the disappearing immigration. The number of Californians under age 18 will virtually halt over the next 20 years, while population growth among those 65 and older will quadruple. The current ratio of one senior for every five working-age residents will become a 3-to-10 ratio by 2020, and 4-to-10 by 2030.

As Allysia Finley adds in the WSJ, California’s outward-bound aren’t mostly the wealthy, but rather a heck of a lot low-education, low- to middle-income earners working in agriculture, construction, manufacturing, hospitality, and etcetera looking for greener pastures away from the economic desert left by the state’s progressive, expensive policies. Sure, California is still a high-tech haven, but their manufacturing industries and labor base are in a steady decline:

But it is ironic that many of the intended beneficiaries of California’s liberal government are running for the state line—and that progressive policies appear to be what’s driving them away. …

Housing in California is on average 2.7 times more expensive than in Texas. The median house costs $459 per square foot in San Francisco and $323 in San Jose, but just $84 in Houston, according to chief economist Jed Kolko of the San-Francisco based real-estate firm Trulia. Housing in California is cheaper inland than on the coast, but good luck finding a job. The median home in Fresno costs $95 per square foot, but the unemployment rate is nearly 15%, compared with 6% in Houston.

California’s staggering labor and energy costs—it has the nation’s most stringent fuel and renewable standards—have helped kill hundreds of thousands of manufacturing jobs in California’s interior. Note: Those are jobs that traditionally served as entry points to the middle class. The Golden State has shed a third of its manufacturing base over the past decade. …

Meanwhile, small businesses that can’t leave California so easily have been slow to invest because they are financially squeezed. Rents are prohibitive, and Sacramento takes 9.3% of every dollar over $49,000—and 13.3% over $1 million—that an individual or small business owner earns.

Funny how all of those progressive policies are having unintended consequences that hit the hardest the very people they’re intended to help — and that liberal model is getting plenty of stiff competition from more business-friendly, low-tax, economy-boosting states in the meantime.


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