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The California exodus is the late 20th century and ongoing 21st century mass emigration of residents and businesses from California to other U.S. states or countries.[1][2] The term originated in the late 20th century; it resurged in use to describe demographical trends that resulted from the COVID-19 pandemic in California.[3][4][5] Common reasons for residents leaving California include the high cost of living, crime, politics and traffic,[6] as well as comparatively high tax levels and a complex regulatory environment for businesses.[7] Texas is the leading destination of California's former residents,[6] followed by Arizona.[8]

Origins of the term

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Cultural, demographic, and economic shifts in the late 20th century resulted in a perceptible trend of California residents and business emigrating to other states, particularly to Texas, Arizona, Nevada, and states in the northwestern United States.[9] Articles published in 1989 by the San Francisco Examiner and Knight Ridder, as well as in 1991 by the Los Angeles Times dubbed the phenomenon the "California exodus"[9][10] and "Great California Exodus".[11] A 1995 study published in Geographical Review attributed various causes for mass emigration from California:[12]

Military base closures, businesses abandoning a state regarded as overregulated and tax-unfriendly, and growing unease about the attainability of an idyllic life along the Pacific Slope began a trend that has gained volume and velocity. By late 1992 quality-of-life surveys found residents' perceptions of California had reached an all-time low, with only 30 percent considering the state "one of the best places to live". Social disorders and natural disasters in both southern and northern California further unsettled an economy that had been little more than dyspeptic since 1988 ... Symptoms of more than a substantial malaise, they indicate a great change. The causes of change may be subject to debate, but their galvanizing effect is beyond challenge: Californians began to emigrate.[12]

According to the San Francisco Examiner, most of those leaving California were people born in the state.[13] In 1993, the level of emigration from California was the highest in its recorded history.[14] Consequences from the Dot-com bubble and its ensuing crash also motivated further mass emigration during the late 1990s and early 2000s.[15] Although the numbers of emigrants exceeded those of immigrants from within the United States, the continued arrival of immigrants from outside the United States led to a general increase in California's population during the 1990s.[16]

Demographics

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Net domestic migration, California[17]
Year In-migrants Out-migrants Net
2010 444,749 573,988 –129,239
2011 468,428 562,343 –93,915
2012 493,641 566,986 –73,345
2013 485,477 581,679 –96,202
2014 513,968 593,308 –79,340
2015 514,477 643,710 –129,233
2016 514,758 657,690 –142,932
2017 523,131 661,026 –137,895
2018 501,023 691,145 –190,122
2019 480,204 653,551 –173,347
2021 433,402 841,065 –407,663
2022 475,803 817,669 –341,866
2023 422,075 690,127 –268,052
Main article: Demographics of California

California joined the United States after the Mexican–American War. Like much of the land ceded from Mexico in the war, California had only a small non-Native population.[18] However, the California Gold Rush led to a population boom, during which California gained statehood in 1850. Between the 1850 and 1860 censuses, its population more than quadrupled. It saw a second period of growth after World War II thanks to the aerospace and defense industries, and a third during the 1980s and early 1990s because of the Silicon Valley tech industry. Population growth slowed in the mid-1990s as the federal government cut aerospace spending after the end of the Cold War, and again after the Great Recession.[citation needed]

The state has had a net loss of domestic migrants every year since about 1989.[19][17] According to Census Bureau estimates, 6.2 million people left the state in the 2010s decade, while 4.9 million moved in: a net loss of 1.3 million residents.[20] In 1955–1960, the ten largest state-to-state migration flows involving California all had the state as a recipient of people, while in 1995–2000, nine of the ten largest flows involving the state had California as a net loser, with only New York sending more people to California than it received in return.[21]

According to the California Department of Finance, the state had 135,600 more people move out than moved in from July 2019 to July 2020, marking the third straight year of net migration losses.[22] After peaking just shy of 40 million Californians,[23] by 2020 into 2022 onward this slowing had crossed the zero population growth mark into outright negative population growth for the first time in over a century.[24]

The exodus worsened in 2021,[25] when more than 360,000 people moved out of California, especially going to states like Texas, Arizona, Washington, Idaho, and Utah. Some are also moving to Mexico to avoid the 2021–2023 inflation surge, as Mexico's cost of living is lower.[26] Between April 2020 and July 2022, the state's population dropped by more than 500,000 people.[27]

In July 2023, California Department of Finance reviewed its population forecast for 2060 and concluded that the state's population would stay constant at about 40 million people, instead of reaching 53 million as estimated in 2013.[28][29] In October 2023, the Stanford Institute for Economic Policy Research found that California was "hemorrhaging residents to neighboring states like Texas, Arizona, and Nevada" at "higher levels than ever before", across all income levels, and especially among college graduates.[25][30]

California's population grew in 2023 for the first time since 2020, driven by lower mortality and higher legal foreign immigration.[31] However, net domestic migration was still negative (91,189 people left for other states)[32] and the population growth was low (+0.17%).[33]

Causes

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For individuals

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The primary cause of the exodus is the high cost of living (and especially the cost of housing), followed by issues such as crime, politics, pollution, and traffic.[6][25][27] Kenneth P. Miller said in 2022 that taxes, as well as rising costs on housing, food, and other needs and wants, are the biggest reason for Californians leaving the state.[34] The rise of remote work also made it easier for people to leave California.[35]

Housing and infrastructure

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California has repeatedly been ranked as one of the country’s most expensive states to live in. The median asking price for a house was $797,470 in California in 2022, which only a quarter of households in the state can afford.[26]

Economists have cited restrictive zoning policies and lack of investment in transportation infrastructure that has resulted in sprawl, constrained housing supply, high housing prices, and severe congestion. They also cited over-reliance on sales tax, fees, and disproportionate property taxes on new residents caused by 1978 California Proposition 13.[36]

In a December 2020 column for the Los Angeles Times, journalist Michael Hiltzik argued that California's slowing population growth was a cause for concern but not a full-blown crisis. Hiltzik quoted demographer Hank Johnson from the Public Policy Institute of California as saying that recent data "is just an incremental change from what we've been seeing over a couple of decades." According to Johnson, California's population trends don't compare to the "hollowing-out" of Rust Belt cities such as Cleveland, Detroit, and St. Louis, which have lost more than half their populations in the last 50 years. Hiltzik instead says that a lack of affordable housing is California's main problem, as it has pushed young people out of the state, and that concerns about over-regulation are being exaggerated.[19]

Environmental policies and mandates

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According to the Stanford Institute for Economic Policy Research, the climate change policy of California could increase exodus to more lenient states like Arizona and Texas.[25]

For businesses

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Several businesses, particularly Silicon Valley companies, have moved their headquarters out of California in recent years. Some of the largest businesses that have announced moving their headquarters include Charles Schwab, Oracle, Palantir, and Hewlett Packard Enterprise.[37] Though they have moved to a variety of other states, Texas has received many of the new headquarters, including those of Hewlett Packard Enterprise and Oracle. In 2024, Chevron announced it would move its headquarters to Houston, Texas from San Ramon, California.[38]

Businessman Elon Musk moved from California to Texas in late 2020.[39] Frustrated by California's Covid-19 lockdown policies, Tesla relocated its headquarters to Austin, Texas in 2020 next to the company's gigafactory.[40] However, in 2023 Tesla announced that it was opening its engineering headquarters back up in Palo Alto.[41] In 2024, Musk also moved SpaceX's headquarters from Hawthorne, California to Brownsville, Texas, though the company maintains its Hawthorne facility.[42]

According to research by the Hoover Institution, factors leading to business relocations are "taxes, regulations, litigation costs, labor costs, energy and utility costs, and employee cost of living".[43] Shopping mall operator Westfield commented that: "A growing number of retailers and businesses are leaving the area due to the unsafe conditions for customers, retailers and employees, coupled with the fact that these significant issues are preventing an economic recovery of the area".[44] Nordstrom, Whole Foods said they were abandoning San Francisco because of changing economic conditions or employee safety.[45]

Consequences

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The exodus has cost California one seat in the House of Representatives after the 2020 U.S. Census.

In the 2020 redistricting cycle based on the 2020 census, California lost a seat in the House of Representatives for the first time in its history, going from 53 to 52 seats.[46][47] In the aftermath of the COVID-19 pandemic, the continued negative growth of the state saw predictions of up to 4-5 seat losses for California in the House of Representatives for the upcoming 2030 redistricting cycle, which would shrink its delegation from 52 to 47 seats. This would be the largest decline recorded by any state in one cycle.[48][49][50]

According to data from the Internal Revenue Service, migration of the taxpayers out of California resulted in California being the biggest income loser ($24 billion) in 2022.[51]

By location

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San Francisco

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San Francisco is suffering from the opioid crisis, with the second highest rate of drug deaths of any large city in the country.[52] Like many other large cities in California, San Francisco also has a large homeless population.[53] Following the COVID-19 pandemic, many tech workers have embraced remote work, causing about a third of the commercial real estate in downtown San Francisco to be empty.[54] For example, between 2020 and 2023, nearly 40 retail stores have closed in Union Square’s zip code.[44] Northface, Zara, and Macy’s closed some of their stores.[55]

Some observers have theorized that San Francisco could enter a "doom loop", with the downtown portion of the city having only 32% of the cell phone activity as pre-pandemic levels.[56] Others argue that doom loop claims are exaggerated and that the crisis is isolated to downtown San Francisco rather than citywide and that San Francisco has always been a "boom and bust" city.[57]

According to US Census estimates, San Francisco's population declined by more than 60 000 people, or more than 7%, from 2020 to 2022.[44] In 2023, the city's population increased, with the AI boom cited as a contributing factor.[58]

See also

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References

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Citations

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  1. ^ "Golis: True or false? People are leaving California in droves". Santa Rosa Press Democrat. 2021-12-05. Retrieved 2023-06-16.
  2. ^ "'Cal Exodus' debunked? UC survey finds Californians aren't leaving the state any more than usual". ABC7 Los Angeles. 2021-07-08. Retrieved 2023-06-16.
  3. ^ "California Exodus? Growth Rate At Record Low As More People Leave". KPIX 5 CBS San Francisco. CBS Broadcasting Inc. 16 December 2020. Retrieved 27 January 2021.
  4. ^ Song, Sharon (5 January 2021). "Study shows California exodus, with more people leaving the state despite the pandemic". KTVU FOX 2 (San Francisco). FOX Television Stations. Retrieved 27 January 2021.
  5. ^ Molinski, Michael (8 January 2021). "Coronavirus May Be The Tipping Point In New York And California Exodus". Investor's Business Daily. Investor's Business Daily, Inc.
  6. ^ a b c "Droves of Californians are moving to Texas. Here's the life they are finding". Los Angeles Times. 2023-11-06. Retrieved 2023-11-08.
  7. ^ Lin, Summer (2022-07-29). "California exodus continues, with L.A., San Francisco leading the way: 'Why are we here?'". Los Angeles Times. Retrieved 2023-06-16.
  8. ^ Leonard, Christian (2023-10-22). "California exodus: Charts show huge shift in which U.S. states most people are moving to". San Francisco Chronicle. Retrieved 2023-11-08.
  9. ^ a b Fernandez 1989, p. 14.
  10. ^ Nussbaum 1989.
  11. ^ Secter, Bob (May 19, 1991). "Getting Out: Tired of Sigalerts? Fed Up With Smog? Afraid to Go Out at Night? Pack Your Bags and Join the Great California Exodus". Los Angeles Times Magazine: 745 – via Newspapers.com.
  12. ^ a b Starrs & Wright 1995, p. 418.
  13. ^ Fernandez 1989, p. 3.
  14. ^ Starrs & Wright 1995, p. 420.
  15. ^ Girion 2001, p. 475.
  16. ^ McCormick 2000, p. 3.
  17. ^ a b Bureau, US Census. "State-to-State Migration Flows". The United States Census Bureau. {{cite web}}: |last= has generic name (help)
  18. ^ "The California Gold Rush | American Experience | PBS". www.pbs.org. Retrieved 2023-06-03.
  19. ^ a b "Column: California isn't 'hemorrhaging' people, but there are reasons for concern". Los Angeles Times. December 24, 2020.
  20. ^ "653,551 folks left California in 2019. Where did they go?". The Orange County Register. November 9, 2020.
  21. ^ "Net Migration Between California and Other States: 1955-1960 and 1995-2000". United States Census Bureau. March 7, 2013.
  22. ^ "California's growth rate at record low as more people leave". CNBC. December 16, 2020.
  23. ^ Beam, Adam (23 December 2019). "California's Population Stalls Just Shy of 40 Million". AP.
  24. ^ Avalos, George (4 May 2022). "Exodus: Bay Area, California population dropped in 2021 as people exited". BANG.
  25. ^ a b c d "Study: California population drain is real; State is "hemorrhaging" residents to other states - CBS San Francisco". www.cbsnews.com. 2023-10-26. Retrieved 2023-11-08.
  26. ^ a b Dymond Green (13 June 2022). "The California exodus continues as residents head south of the border". CNBC.
  27. ^ a b "California's population dropped by 500,000 in two years as exodus continues". Los Angeles Times. 2023-02-15. Retrieved 2023-03-04.
  28. ^ "California Looks Into the Future — and Sees Fewer Californians". Bloomberg.com. 2023-07-22. Retrieved 2023-11-08.
  29. ^ "California Exodus: Once growing rapidly, state population projected to remain the same through 2060". Santa Cruz Sentinel. 2023-07-26. Retrieved 2023-11-08.
  30. ^ "California's population drain | Stanford Institute for Economic Policy Research (SIEPR)". siepr.stanford.edu. Retrieved 2023-11-08.
  31. ^ "California's population grew in 2023 for first time since 2020". Reuters. 2024-04-30.
  32. ^ "California's population grew in 2023, halting 3 years of decline, state estimates". AP News. 2024-04-30. Retrieved 2024-05-16.
  33. ^ Castleman, Terry (2024-05-14). "California exodus left a gaping population hole. Can the Golden State finally bounce back?". Los Angeles Times. Retrieved 2024-05-16.
  34. ^ Miller, Kenneth P (23 March 2022). "What is causing californians to leave the state?". San Bernardo Sun. Retrieved 29 September 2022.
  35. ^ Sen, Conor (2023-10-30). "Exodus From New York and San Francisco Is Far From Over". Washington Post.
  36. ^ "'California Exodus': Why Are So Many People Leaving The Golden State?". www.wbur.org. 11 February 2021. Retrieved 2021-06-28.
  37. ^ "What companies have left California since COVID?". KRON4. 2022-06-23. Retrieved 2023-05-26.
  38. ^ Elliott, Rebecca F. (August 2, 2024). "Chevron, in Snub to California, to Move Its Headquarters to Houston". The New York Times. Retrieved August 2, 2024.
  39. ^ "Column: California isn't 'hemorrhaging' people, but there are reasons for concern". Los Angeles Times. December 24, 2020.
  40. ^ Chokshi, Niraj (2021-10-07). "Tesla Will Move Its Headquarters to Austin, Texas, in Blow to California". The New York Times. ISSN 0362-4331. Retrieved 2023-05-27.
  41. ^ Bushard, Brian (February 22, 2023). "Tesla Shifts Its Engineering Headquarters Back To California". Forbes. Retrieved 2023-05-27.
  42. ^ Clark, Stephen (17 July 2024). "Elon Musk says SpaceX and X will relocate their headquarters to Texas". Ars Technica. Retrieved 22 August 2024.
  43. ^ Vranich, Joseph; Ohanian, Lee E. (2022-09-14). "Why Company Headquarters Are Leaving California in Unprecedented Numbers". Economics Working Paper (21117). Hoover Institution.
  44. ^ a b c Delouya, Samantha (2023-08-30). "It's not just crime: What's really going on with San Francisco's shrinking retail district". CNN. Retrieved 2024-06-19.
  45. ^ Kavilanz, Parija (2023-05-23). "Why retail theft is soaring: inflation, the economy – and opportunity". CNN. Retrieved 2024-06-19.
  46. ^ Ronayne, Kathleen (2021-04-27). "California losing congressional seat for first time". AP News. Retrieved 2023-12-02.
  47. ^ Skelley, Geoffrey (2021-04-26). "Which States Won — And Lost — Seats In The 2020 Census?". FiveThirtyEight. Retrieved 2023-12-02.
  48. ^ "2030 Apportionment Forecast - 2022". The American Redistricting Project. 2023-03-08. Retrieved 2024-06-19.
  49. ^ "California, New York in danger of seeing House delegations shrink further". 2023-12-22.
  50. ^ "How Congressional Maps Could Change in 2030 | Brennan Center for Justice". www.brennancenter.org. Retrieved 2024-06-19.
  51. ^ "The Blue-State Wealth Exodus Continues". Wall Street Journal. July 3, 2024.
  52. ^ Hammond, George; Kinder, Tabby (2023-05-18). "What if San Francisco never pulls out of its 'doom loop'?". Financial Times. Retrieved 2023-06-03.
  53. ^ "Homeless Populations Are Rising around California". Public Policy Institute of California. Retrieved 2023-06-03.
  54. ^ Hammond, George; Kinder, Tabby (2023-05-18). "What if San Francisco never pulls out of its 'doom loop'?". Financial Times. Retrieved 2023-05-26.
  55. ^ "S.F. downtown exodus: Map shows every major retail closure since 2023". 2024-05-16.
  56. ^ Feng, Alice (May 5, 2023). "Downtown San Francisco continues to struggle as more businesses leave". Axios.
  57. ^ Shultz, Alex (2023-05-19). "Media's SF 'doom loop' obsession has turned into a doom loop". SFGATE. Retrieved 2023-05-26.
  58. ^ "Is pandemic exodus over? SF population slightly increasing, Census Bureau numbers show". ABC7 News.

Sources

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