Make sure to be on the lookout in the coming days for our follow-up on this topic from Texas reporter Amy Sorter.
SACRAMENTO-This morning, GlobeSt.com reported that Texas Gov. Rick Perry recently released a radio ad in California criticizing the Golden State’s business climate and encouraging businesses to relocate to Texas, but we pointed out that Kish Rajan, director of the CA Governor’s Office of Business and Economic Development, says not to worry, noting that business relocations only account for 0.03% of annual job losses in the State.
And while not all of the local sources we spoke with were keen on the State, with many having some suggestions for improvement, Vic Montalbo, president and partner of Epsteen & Associates, who tells GlobeSt.com that California continues to remain a top destination for business with its port, agriculture, entertainment, education, bio-tech, energy and medical industries leading the growth. “Despite state migration, the state’s population continues to increase, with an anticipated continued growth to 50 million by the year 2050.”
According to Montalbo, “with Northern California and Southern California providing different amenities, services, and business venues, and if the world’s best minds consider climate, lifestyle and the physical features found no other place in the country, California will remain as strong, if not stronger than today, despite the increase in the popularity of other growing parts of the country.”
A recent forecast written by Los Angeles-based Beacon Economics‘ Jordan Levine, economist and director of economic research, points out that both the media and policymakers alike have called California’s economy “broken” and have pointed to the performance of other states—most notably Texas—as evidence that California is losing a competitive battle with other states. But Levine points out that there are a few studies out there by two-non-partisan research groups—the Public Policy Institute of California and UCLA—that indicate that California is not losing out to Texas.
“Although Texas is commonly thought of as a faster growing economy relative to California, in real terms, California has tracked economic growth in Texas quite closely, and California consistently outperforms Texas and the rest of the nation in terms of manufacturing output,” he says.
“Texas beats California hands-down in real estate,” Levine says in the forecast, pointing out that the median price for a single-family home in California’s most expensive region is more than three times the price for a single-family home than Texas’ most expensive metropolitan area, the Austin-Round Rock MSA.
Undoubtedly, Levine says, “there are efficiencies that could increase the ‘bank for our buck’ in terms of our return on government spending, says Levine, but there relative economic performance of California and Texas hinges more on cost of living and structural economic differences than it does on ‘business friendliness.’”
And how about hearing it from the ones doing business here? Sister publication, Real Estate Forum recently broached the subject of doing business in California with Edwards LifeSciences, a medical device company that continues to keep Irvine, CA as its home base despite other state’s calls.
Tom Porter, vice president of real estate at the company, told Forum that while California isn’t always known as the easiest place to do business, “[It] is home based on the intellectual talent that we have here, is a great place to work, has quality schools, and we are able to attract and retain the talent required to run our business.”
Aside from the cost and the ease of business, Porter says that people want to work in California due to the climate. “Also keep in mind that having a number of quality universities bringing in business. Think of the Silicon Valley or the tech industry in general that was created out of people coming out of school and wanting to stay where they attended college.”