Recession Fuels Texas-California Pipeline - NBC 7 San Diego

Recession Fuels Texas-California Pipeline

California's financial troubles has led to a steep population loss, with many of those people fleeing to Texas



    Recession Fuels Texas-California Pipeline
    In a twist, Texas has been luring hordes of Californians with the promise of new opportunity. Last year, the Los Angeles suburb of Vernon took out billboard ads accusing Texas of stealing its jobs.

    When Steve Murdock sees statistics that show the huge streams of people moving between California and Texas every year, he is reminded of an old country song.

    Detroit City” -- with the refrain of "I want to go home” -- was written half a century ago about a Southerner who finds work in the auto industry and longs to return. Murdock, a former chief demographer for the U.S. Census Bureau, thinks the song remains an apt analogy.

    To this day, seemingly disparate parts of the country share deep, historic ties based largely on one’s ability to attract people from the other. The tide of people ebbs and flows according to economic opportunity and family bonds.

    “This sense of going and coming goes way back,” said Murdock, a Rice University sociology professor. “They are long-term patterns, and once they’re established, the flow back and forth continues.”

    Nowhere is this more evident than in the case of California and Texas.

    The thousand-mile migratory route between the two states is among the country’s busiest. For many decades, the movement benefited California, the state traditionally associated with American opportunity and growth. But now the trend has flipped, with California hemorrhaging people to its Southern rival, and Texas taking a lot more than it gives.

    Since 1990, 3.4 million more people have fled California for other states than vice versa,  according to a study by the Manhattan Institute. (Because births continue to outpace deaths, and more people continue to move from other countries, California's total population grew to over 37.5 million last year.) California led all states in total outward migration during that period, while Texas was the second most popular destination state, edged only by Florida.

    California's steep drop includes a net loss of nearly 250,000 people to the Lone Star State. Last year, 59,000 people left California for Texas, while 37,000 did the opposite, according to the census.

    Lately, the trend has been exacerbated by the state’s very different experiences with the recession.

    The downturn was bad for everyone, but California took it on the nose. It suffered disproportionately from the home-mortgage crisis. Many of its local governments are on precarious financial footing; a few have declared bankruptcy. Its unemployment rate has outpaced the nation's.

    Texas, on the other hand, weathered the recession relatively well, analysts say. Taxes are lower than California’s, regulations are fewer, the cost of living is cheaper, and so are wages.

    “The differential has resulted in us continuing to grow economically while California has slowed,” said Lloyd Potter, Texas’ state demographer.

    In addition to the traditionally strong sector of oil extraction and refining, the chemical and natural gas industry are doing well, as are the commodities and financial services sectors, Potter said.

    William Frey, a demographer at the Brookings Institution, analyzed data covering a three-year period that spanned the recession and found that while California sputtered, several Texas metropolitan areas ranked near the top of the country for attracting young college-educated job seekers.

    "These were basically down years for most places, but the Texas metros have attracted these highly prized migrants," Frey said.

    The upshot, prominent Waco economist Ray Perryman points out, is an unemployment rate of about 6.6 percent, below the national average. And while Texas has regained the same amount of jobs it lost during the recession, California has recovered only about a third.

    “The big reason for the migration from California to Texas is quite simple: jobs,” Perryman said in an email.

    With the influx of people inevitably come growing pains, usually in the form of crowded schools and increased infrastructure needs. But Texas doesn't seem to be complaining much about that these days.

    Instead, they sound confident that they’re state will continue to prosper – and keep luring Californians looking for a better way of life.