Sunday, August 15, 2010

Utah In The California Business Market

Looks like Utah has joined the list of states competing for California jobs and business, according to the Sacramento Bee. Their efforts seem to be successful with a number of California's high tech companies already moving or expanding to their state. I suspect the number of companies moving there will increase.

Will California consider changing its behavior to try and keep more businesses in the state? I've seen absolutely no evidence of that, so far.



At 10:30 AM, Anonymous Anonymous said...

I don't think High Tech business flight from California has much too do with the tax structure. Housing prices are ridiculous, especially around the High Tech business centers. The Public school systems are an absolute mess. High tech wages are flattened out, or going down - thus people are having a harder time justifying all of these costs. The workers can afford homes in places like Utah or Oregon. The public school systems are more funded (And more white). The dollar goes a little further in these states.

But you wait and see, the influx of millions of new workers in these states will cause new infrastructure problems, new needs to spend money... They will be in the same boat in ten years, as we are now.

At 11:02 AM, Blogger Fred Mangels said...

Maybe, maybe not, but I see what you're saying. Thing is, there are other states that are just a better environment for people and businesses to live in. As people move to those states, they bring more money with them, some of which ends up becoming revenue for the state.

I know a guy- who visits this blog- who lives in Arizona for half the year and summers at his home in Eureka. He has a home in Yuma and was telling me how low the property taxes are there. I think they were about a third of what we pay here, yet I don't believe there's any shortages of government service there.

Made me feeling like moving, if I could afford it, but what's a 54 year old guy gonna do for work once he moves there?

At 11:26 AM, Blogger AJ said...

Of the 5 examples, 4 are of businesses expanding into new areas, not businesses fleeing California.

Expansion is an opportunity to cherry pick a better location, tap a new talent pool, seek new tax incentives, etc. There will always be better places than wherever you are now.

My problem with the doom and gloom scenario is that every time one of these articles come up, the central example is of a business expansion, not a business fleeing California.

And, all 5 of the companies cited are tech companies (probably all sited in the Silicon Valley). Someone could make an argument that this is doom and gloom for the Silicon Valley, but even that sounds like a stretch. The bubble has burst, but the gum still has some flavor in it yet.

At 7:31 PM, Anonymous Anonymous said...

AJ, it doesn't matter if it companies leaving or chosing to expand elsewhere. The fact is that California is an unfriendly place for business. If 1 of the 5 businesses pick up and leave and the other 4 choose to expand elsewhere, it equates to a net loss of private industry in California. These jobs provide income to the state via taxes, fees, and spending. What is left is companies that can't leave due to constraints such as access to shipping ports, and government jobs which are a net loss for creating a prosperous society.

At 7:40 PM, Blogger AJ said...

Of course it matters! Before I consider an opinion to be a fact I like to see evidence. This article did not meet that standard. Evidence is all I ask.

At 8:11 PM, Blogger mresquan said...

The Mormons receive an incredible amount of government subsidies so moving businesses to California where businesses are heavily taxed could allow them a perceived right to collect more government subsidies,essentially writing off the taxes handed to them by the state,while putting a bit more cash into the church's coffers.


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