The California Exodus = New Opportunity

The California Exodus is not new… but it has accelerated. You may have noticed for sale signs popping up in the neighborhoods around you, or you know someone whose announced they’re moving to a new county or out of state. Why are people moving and where are they going?

The current climate of California has become shadowed despite its sunny weather. The pandemic, lockdowns, rolling blackouts, fires, high taxes, unaffordable housing, high cost of living, poor education, political atmosphere, and the shrinking job market are among the few reasons Californians are packing their bags and moving elsewhere.  

But California has witnessed a constant stream of people moving out for almost two decades. A study conducted by the state ofCalifornia’s Legislative Analyst’s Officein 2018 found, from 2007 to 2016, about 5 million people moved into California while 6 million people moved out. That’s a net loss of 1 million California residents.

California net out-migration to other states (Photo courtesy of the Legislative Analyst's Office)

A more recent study by the U.S. Census Bureau revealed California had net loss in population of around 138,000 in 2016, 190,122 in 2018, and 173,000 in 2019 according to the Census Bureau’s American Community Survey. 

Businesses are also following the trend. Joseph Vranich, owner of Spectrum Location Solutions, has helped companies relocate for the last 12 years, often out of state. In 2019 he released a report identifying 660 California companies had moved 765 facilities out of state since 2018, including his own company move to Pennsylvania from California. This report follows his 7-year study from 2008 to 2016 identifying 13,000 business relocations out of state (1,800 in 2016 alone) which includes headquarter relocations and opening new operations outside the state of California.  

So, if this departure from California is not new, why is there so much attention on it now? With offices shutting down and employees moving to remote working, the need to stay in a certain geographical area has staggeringly dropped. Those who are still employed have newfound freedom to move to cheaper living, bigger houses, open economies, and in some cases friendlier communities while working remotely for their California based job. Others have had the hardship of losing their job during the pandemic and have struggled to find a new one, especially with the strict pandemic shutdowns impacting businesses. A move to an open economy state has become a necessity for basic living needs. Online groups have also emerged promoting living in other states and encouraging others to follow in their footsteps. FB groups such as ‘Life after California’ and ‘California Exodus’ show pictures of families, their new homes, and their testimonies of a better life. 

What’s the bright side? The California Exodus presents a new opportunity for current residents and future Californians. With less population, California’s overcrowded freeways will become more manageable, cutting down on the traffic headache. The surplus availability of housing should instigate a buyer’s market, driving housing costs down. The absence of companies that contributed to 46% of California’s high income state tax revenue gives California leaders the opportunity to re-evaluate their tax increase trend and instead drive income taxes down along with business costs to help boost the economy with a business friendly market – which will be even more attractive with the decreased competition. California still has people moving into the state, that means new ideas, different perspectives, and the potential for new growth that could only be achieved by a change of neighbors. 

Change can be hard. We are all witness to that after 2020. But change, also, is where the Lord tends to do His best work. He never leaves us where we are, but constantly loves and disciplines us to a new place. “Forget the former things; do not dwell on the past. See I am doing a new thing! Now it springs up; do you not perceive it? I am making a way in the wilderness and streams in the wasteland.” Isaiah 43:18-19 NIV

People may be on the way out, but opportunity is on the way in.