People Are Leaving California
It’s not just companies that are leaving California, as individuals and families are also leaving the Golden State in favor of living elsewhere. Millions have left since 2020, and that number keeps on rising.
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In the first six months of 2024, 17,824 people left California to go somewhere else. The main reason was the high cost of living, thanks to California being the second most expensive state in the US.
Chevron Is the Latest Company to Leave California
Chevron is the latest in many large companies to have left California for Texas. It is the second-largest oil company in the US and is moving from San Ramon to Houston.
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One of the main reasons for moving to Texas is wanting a more business-friendly environment, which Chevron feels California doesn’t have. It is also due to a lawsuit filed by California against big oil companies because of climate-related issues. This is an issue that Texas doesn’t have.
Charles Schwab
Charles Schwab is another company that has left the Golden State. This is all part of a $26 billion merger with TD Ameritrade, and part of the deal means relocating to Texas.
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Part of this move is to help save on costs. It is believed that they could save 10-15% by moving to Texas, as the Lone Star State only imposes a 0.75% franchise tax on business margins, compared to the 8.84% that California charges.
CBRE
CBRE is the largest commercial real estate firm in the US. It has been based in California for over 100 years, with it first starting in San Francisco in 1906. However, like many other companies, CBRE decided it was time for a change.
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5000 of its employees are based in California, but as it is a global company, it assured that most jobs wouldn’t be moved as it was just the headquarters that would be moving to Texas. The main reason for this move is due to the impact of COVID-19 on real estate.
Hewlett Packard Enterprise
Hewlett Packard Enterprise was the company that started Silicon Valley, all from a garage in 1939. Almost nine decades on from starting in the Golden State, the company has decided to make the move to Texas.
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This is due to various job policies, high taxes, and regulatory enforcements, which made Hewlett Packard Enterprise feel it would be better off being based in Texas.
AECOM
AECOM is a Fortune 500 engineering and construction company. Despite being based in California for many years, the company has decided to follow the trend of other large companies and move to Texas.
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While it plans to keep its 2500 employees in its Los Angeles and other California-based offices, the headquarters will be moved to Dallas and other Texas locations. This is all due to Dallas becoming the place for corporate headquarters and being a corporate talent magnet, something they believe will significantly benefit the company.
Tesla
Various new laws in California have led Elon Musk to decide to move many of his companies to California, including Tesla. While its headquarters are in the Lone Star State, much of its engineering work is still based in the Golden State.
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Some of the reasons Musk claims have caused this move are because Texas offers better commute times and affordable housing for his employees. It also offers the company lower operating costs, lower taxes, and fewer regulations.
Space X
Space X is another of Musk’s companies leaving California for Texas. One of the main reasons for this move is a difference in politics, as Musk disagrees with some new laws made in California.
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This is all due to Assembly Bill 1955, which bans schools from telling parents about their child’s gender identity. However, a dislike for California laws first started with the COVID-19 lockdowns, which he strongly disagreed with.
X (Formerly Twitter)
X is the latest of Musk’s companies to move to the Lone Star State, much for the same reasons as he has moved his other two companies. This is a recent decision, with the move set to happen over the next few weeks.
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The company is working on transport for those in the San Francisco area who will be moved to other areas in California. Meanwhile, the main headquarters will be moved to Austin, Texas.
Oracle
In 2020, it was announced that Oracle was moving out of California and into Austin, Texas. This was due to taxes and non-business-friendly practices, with the pandemic sealing the deal for the company to make the move.
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The hope was that it would give employees a flexible work-life balance. However, four years on from this move, the company has decided to move yet again, this time to Nashville. This is a strategic move, as the company plans to head deeper into the healthcare industry.
Can California Get Its Companies Back?
Even though California used to be the main place for large companies to base their headquarters, many have been making their way to Texas. Texas state officials have been trying to do this for years, and they are finally succeeding.
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The main question on most people’s lips is whether California can get its businesses back. Oracle has already proven that businesses don’t stay in Texas forever, since it moved to Nashville. We will just have to wait and see whether they decide to move back to the Golden State.