So, no data at all? I think you've really shown your whole ass to everyone by citing an ALEC position paper. ALEC has rated California as having either the #1 or #2 "worst business climate" in America every year it has published it's rankings, which are merely propaganda for a certain political viewpoint. ALEC's "Rich States, Poor States" paper has been reporting from Oppositeland for decades.
There's also the fact that California is regularly at the bottom of rankings of "business friendly" states. I'd rather locate my business in a state that wants me there.
Compared with the other states I've lived in, California seems to have the least corrupt and most reasonable regulations. Sure I can find plenty of ridiculous stuff (the boneheaded 8-hr/day vs 40 hours/week rule) but by and large it's a great place to do business.
Those ALEC, Heritage foundation etc clowns are welcome to stay in DC and screw up other states. Their arguments are always data-free.
I have been hearing how California has been business unfriendly for the last 20 years, only for our economy and job growth to crush all other states. I mean just look at VC investment and IPO creation and the last decade and decide which state creates more business. By all objective stats, California seems to be the most business friendly state
no need. they compare California (high competition from private sector) with other states without such competition.
they could manipulate it to proove any point. with the same data I could say that with sunnier days lead to more employee attrition. any point that California differs from the other state can be blamed, after the author ignored the private sector salaries, and he chose to pick a competing state without salary transparency to make their point.
Surely decades of producing multiple businesses leading the world in pretty much all business metrics is more indicative of business climate than 1 year.
Maybe whatever laws in the past year dethroned California, but I am not willing to bet on it.
I love hearing all this stuff about how California is so business unfriendly when it routinely ranks near the top for largest economies in the entire world.
If anything, it’s massively underegulated when put up against to comparably-sized economies in the developed world.
Is that data (New businesses/yr/capita) available for California specifically?
For example, measures of economic mobility (ability for persons to traverse up the economic class system) are dismal for the U.S. as a whole. But for California specifically we're more-or-less on-par with the best nations. At least, that's what I remember from the RadioLab podcast on the subject. I've always been more skeptical of U.S. wide statistics since then.
That's my beef with this report too. Business leave and come all the time. It's important to clarify how many are created in the same period, and what types of business left/prospered.
As much as I wish California had a better check and balance in its government and particularly policies, the report does not necessarily show that California has lost its way.
I'm always curious in these things how they will cherry pick the data to achieve their narrative.
In 2018 California had 954,000 businesses[1] according to the Census bureau. If we take the "13,000 have left between 2009 and 2016" (why stop there?) that would represent nearly 1.4%. However the Hoover Institute doesn't actually tell you if they were "small business" or "regular businesses".
That can be important because there are nearly 4 million small businesses in the state[2] and a departure is a departure, small, medium, or large. If use 3.9 million as the total number of businesses that is just .3%.
Every year people argue "California taxes too much, businesses are leaving in droves" but that isn't supported by actual business license data nor employment data. Over the last 10 years California consistently has the largest economy of all 50 states.
Nobody likes taxes, and I personally don't like misleading articles.
A good measure of business friendliness is to take a look at how the US Chamber of Commerce ranks the states in this regard. I did a while back. California is dead last. And don't even get me started on the tax rates that are about to explode beyond their already bloated level.
We don't assume all startups are in California, we just have the best dataset for CA (since that is where we operate). We look forward to showing analyses like this for other states as information becomes available.
Compare the success of Nevada's businesses with those of California's. Can you think of any major Nevada success stories outside of the casinos or Zappos? (Even Zappos found success as a Cali company before it moved to Nevada.)
As it turns out, having one of the "best business climates" is usually not correlated with actual business success. States with "favorable" business climates have such climates precisely because businesses would not otherwise succeed in those states. This puts such businesses at a disadvantage when they try to expand to non-favorable states: without the tax subsidies, they simply aren't efficient enough to succeed in a cutthroat, capitalist environment.
Tax Foundation's "best business climates" ranking is based purely on tax rates. It doesn't even take into account tax incentives! If they're going to rank states based on tax policies, they should be ranking based on effective tax rates, not hypothetical maximum marginal tax rates. The other major flaw with the rankings is that they don't take into account the other factors that matter far more to a small business: such as market opportunities, customer availability, employee quality, and support services, none of which you will find in any meaningful qualities in any of the states ranked in the top 10 of the Tax Foundation rankings.
Its amazing how california with all its advantages (climate, tech industry, hollywood etc) can be in such a financial mess...Think how great the state would if its atleast 10% as business friendly as Texas
When people talk about California regulations driving away business it's always an immediate sign to me that they either watch too much Fox News or they're simply talking the book.
First off, $800 is probably too low. It's in California's interest to drive away low margin businesses. If your business really struggles to pay $800 then you should move to Texas or Wyoming. $800 is unlikely to get you even a parking space.
Second, all actual data, actual evidence, not handwavy whining about regulations, indicate California is still far and away the most dynamic economy in the US with the best business growth [1]. Now you might argue California's growth would be even more extraordinary with less regulations (though again, if people ever bother to open a book and learn from the past they'd see most deregulation efforts eg electricity have done more harm than good) but this is a far cry from what may be the most dynamic economy in the world hosting a "small business assassination program."
https://www.gradingstates.org/alecs-rich-states-poor-states/...
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