Jobs Leaving the State? Not Really says New Study

Republicans constantly rail against job killing bills out of the Democratic-controlled legislature.  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. 
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. 

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. 

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. 

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. 



  4 comments for “Jobs Leaving the State? Not Really says New Study

  1. DP Resident
    November 9, 2007 at 2:45 am

    But….. the press would NEVER get statistics wrong, would they???? What about all the statistics coming out of Iraq? They NEVER mess those up do they?

    Most members of he press are under a deadline, opinionated, ill informed, and sometime just plain lazy. Their ultimate goal is to attract attention to make money, not report the truth or inform the public.

    The amount of information left OUT of the above article is laughable. Did they compare the types and compensation of the job that left the state vs the new jobs? You don’t need to be a genius to know that a lot of good paying manufacturing jobs have left the State -autos & aerospace to name a just a few. What kind of work has replaced them?

    Try digging up all the facts, and let people decide for themselves. If you can’t or wont do that, then I guess this is just a purely political blog with no real interest to inform or foster intelligent debate.

  2. Dan Chmielewski
    November 9, 2007 at 2:40 pm

    This isn’t a press issue of reporting; its a study conducted by the Public Policy Institute of California. The press is accurately reporting the problem of job loss which many Republicans cling too is not at all that serious. A reporters can’t be expected to print ever detail of the study when its so readily available with a quick Google search.

  3. DP Resident
    November 9, 2007 at 11:34 pm

    If all they were doing was announcing the study, that might have been alright, but don’t they have an obligation to challenge the findings. At least provide some additional sources or facts to back up the conclusion. If not, they should have placed it on the Editorial Page.

    A “quick” look at did not return a story, but I did find it on PPIC site. Looking for the words “salary”, “income”, or “pay” did not turn up anything. The story treated a $100k a year job the same as a $30k one. Not only does that short the employee, but the tax coffers of the state.

    Isn’t this the same attitude the Republicans took so much heat for when pushing NAFTA and all the new “jobs” it would create?

  4. Dan Chmielewski
    November 10, 2007 at 1:09 am

    It’s actually the same defense the Bush administration uses to show their version of job growth.

    I always thought it was Bill Clinton and Al Gore who took heat from NAFTA

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