Republicans constantly rail against job killing bills out of the Democratic-controlled legislature.Ã‚Â A new study shows that these claims aren’t holding water.
See this story from ABC7:
Oct. 26 – There’s interesting new information out about California’s economy. We’ve heard a lot the last few years about how businesses are fleeing our state for less costly places to do business. It turns out, that may not have hurt us as much as we thought.Ã‚Â
Yes, companies have been leaving California over the decade. As many as 1,300 in a single year. It made it seem like a stampede or mass exodus.
But a new study by the Public Policy Institute of California says the impact was negligible – at worst, just one-tenth of one percent of all jobs in the state.
David Neumark, Ph.D., Public Policy Institute of California: “People, including the media, latch onto these stories. They use the anecdote not just to make an illustrative point, which is how anecdotes should be used, but they used the anecdote as an argument this really is the state of the world.”
Neumark is an economist who took a fresh look at statistics compiled by a private research firm that tracked business relocation.Ã‚Â
He says previous studies overlooked the number of companies that moved into California from other states and the number of newly created businesses. Nevada was the most aggressive suitor enticing companies to cross over with tax incentives.
So, when a company didn’t take the bait, it was considered a victory, such as the groundbreaking for a new Genentech facility in Vacaville.Ã‚Â
Gov. Arnold Schwarzenegger (R) California (April 2004): “They have decided not to move to another state and not to move to another country, but to build their future right here in our golden state.”
Dennis Conaghan’s job is to create and retain jobs in San Francisco. He says companies take relocation seriously.Ã‚Â
Dennis Conaghan, Center for Economic Development: “I think they pay serious attention to these other opportunities, but they drill down and then they think about where are all the advantages, how does it line up?”
What the study suggests is that California should put its emphasis on creating new businesses and retaining existing jobs instead of going after companies thinking about moving out of state.Ã‚Â