Why is California Losing Good Jobs to Other States? It’s Not Rocket Science
For a century, it worked, and brilliantly. The “California model” rested on massive investments in higher education, development of industrial zones in places such as the South Bay and Silicon Valley, and persistent upgrading of basic infrastructure.
Yet the system that made California dynamic and prosperous for so long is now broken and backward-looking. The state still provides ample opportunities for technological and financial elites but leaves behind a broad spectrum of the middle and working classes.
This failure is reflected in the state’s poverty and unemployment rates (both the highest in the nation), and its tepid job growth. Meanwhile other states — Texas, Florida, Arizona, the Carolinas and Tennessee, for example — have copied the California model and they have done it, as Californians once did, based on the goal of lifting up all classes. Long reactionary in their politics and social structure, these states’ business-friendly policies now have something to teach the progressive Golden State.
The defense and aerospace industries are showcases for California’s problem and missed opportunities. The state still leads in numbers of aerospace engineers and creates cutting-edge technologies. But once companies develop products based on all that innovation, they’ve tended to move the manufacturing, with its high paying blue-collar jobs, elsewhere, chasing fewer regulations, cheaper energy and a less expensive cost of living.
Take Jet Zero, which makes fuel-efficient planes. The company, based in Long Beach, is ready for prime time, with large orders for its new planes. But those jets will be built in Greensboro, N.C., in a $4.7-billion plant employing more than 14,000 people over the next decade. The company also plans to move its headquarters to Greensboro when the plant is finished.
Elon Musk’s story is well-known. The space economy is expected to be worth trillions, but Musk’s rocket company has already decamped in large part from California to Texas. Space X and Jeff Bezos’ Blue Origin have built large test facilities in Brownsville and Van Horn, Texas, bringing a blue-collar bonanza to traditionally poor regions.
Even companies that plan to stay headquartered in California are making big investments elsewhere. Anduril, a fast growing tech-driven defense company, designs its systems in Orange County but has announced plans to build a 4,000-job plant in Ohio and is also expanding its operations in Mississippi.
This pattern should alarm the state’s leaders who seem more concerned with boosting green energy, fighting Trump and saving Hollywood. Assemblyman Al Muratsuchi has been pushing for a space commission, as exists in Texas and Florida, but so far to no effect. The California Coastal Commission’s recent rejection of Space X’s request to double launches at Vandenberg Space Force Base, ostensibly over environmental questions, is another sign that the state’s focus is anywhere but on aerospace.
Read the rest of this piece at: Los Angeles Times.
Joel Kotkin is the author of The Coming of Neo-Feudalism: A Warning to the Global Middle Class. He is the Roger Hobbs Presidential Fellow in Urban Futures at Chapman University and and directs the Center for Demographics and Policy there. He is Senior Research Fellow at the Civitas Institute at the University of Texas in Austin. Learn more at joelkotkin.com and follow him on Twitter @joelkotkin.
Photo credit: SpaceX launch of Iridium-4 from Vandenberg AFB by Kevin Gill, via Flickr, under CC 2.0 License.
