Why is so many big tech companies leaving California? Is it the high taxes? The strict COVID-19 shutdowns? Many of the wealthiest residents are leaving for states like Texas, Arizona, and Florida. Recently Elon Musk, Larry Ellison, Hewlett Packard enterprises have all left California, and that’s just a few of them.
Part of the reason the high profile people may be leaving is because of growth of companies like Facebook, Apple, Google, etc… are growing at a large rate. Those companies are crowding out other businesses due to terms of real estate prices and trying to get talented workers.
Larry Ellison, Drew Houston, and Joe Lonsdale recently announced they were packing up and leaving the Golden State. California’s job market is slowing down due to the threat of rising taxes, cost of living increase, plus the heavy regulations. During the COVID-19 pandemic and most places shut down, there has been a rise in remote workers. Now with people being able to work from home ver 135,000 people have moved out of California, this is the third-largest population loss ever recorded for the state. A recent survey has shown that two out of three Bay Area workers would leave permanently if they could work from home indefinitely.
A quote from Elon Musk says it pretty well “If a team has been winning for too long, they do tend to get a little complacent, a little entitled, and then they don’t win the championship anymore. California has been winning for too long and I think they’re taking them for granted a little bit.”
The cost of living in California is extremely high, which means there is also a high cost of employment. The average salary for someone working as Facebook is roughly $300,000 a year, this is due to the cost to live in Silicon Valley.
If you leave California then you can work remotely, keep your job, and your cost of living will decrease. Many are moving to Texas because there are no state income taxes, real estate costs less than in California, If a company wants to buy a large area of land and build a new headquarter, it’s a lot cheaper to do it in Texas.
Florida, like Texas, does not have state income taxes. It has a lower cost of living than California with a similar weather pattern. Also like Texas you can buy large acres of land and build a new headquarter with a lower cost of livings.