One of the persistent urban legends surrounding state policy debates is that numbers of jobs are leaving the state for more “business friendly” locales. A new policy brief by Jed Kolko of the Public Policy Institute of California (PPIC) succinctly dismisses this frequently heard claim:
“Rhetoric aside, California loses very few jobs to other states. Businesses rarely move either out of or into California and, on balance, the state loses only 11,000 jobs annually as a result of relocation – that’s just 0.06 percent of California’s 18 million jobs. Far more jobs are created and destroyed as a result of business expansion, contraction, formation, and closure than because of relocation. Business relocations, although highly visible, are a misleading guide to the overall performance of the California economy. The employment growth rate, which takes into account job creation and destruction for all reasons – not just relocation – is a much better measure of the state’s economy.”
The full brief is a “must read” for anyone seeking an easy, fact-based overview of the issues and challenges facing the state’s economy. We also recommend an earlier PPIC report to Budget Bites readers in search of an in-depth exploration of the question of whether jobs are moving and why. While it might not push the latest blockbuster mystery out of your beach bag, it will arm you with the facts to refute oft-heard claims that we expect to hear repeated as we move closer to election day.
— Jean Ross