The recession and collapse of the housing industry in the United States is causing many Americans to move in search of jobs and a cheaper place to live. But a researcher at the University of California says there has been an unexpected decline in overall state to state migration since the recession. He calls it the “staying home phenomenon.” Of those who did move, many are moving between California and Texas.
Boxes of every size can be seen in the Pappas house.
“It’s exciting, looking forward to getting out there and it’s a new adventure," said Taki Pappas. He and his family of four are packing and leaving the western state of California for the south central state Texas. After being laid-off more than six months ago, Pappas recently got a job in Austin. His wife Mabyn says housing in Texas is half of what it costs in California. “The biggest thing is that we’re not buying immediately but we can actually afford to buy in Austin where as we really can’t afford to buy out here," she said.
“There’s no state income tax there which also helps," said Takki Pappas.
The Pappases are not the only family leaving California because of the economy. The state currently has one of the highest unemployment rates in the U.S.
Michael Stoll at the University of California in Los Angeles studies migration within the United States. “People who have been out of work and the duration of unemployment longer historically now than in the past, so people are moving in part to find employment," he said.
The most recent U.S. Census Bureau figures, from 2007 to 2009, show that more than two million people moved out of California, the most populated state in the U.S. That was when the housing market crashed and the economy declined. Their top destination, the second most populated state, Texas.
Ross DeVol is the executive director of economic research at the Milken Institute. “In Texas’ case, it has energy it has oil and natural gas, did very well throughout the recession. Also Texas exports more to Mexico, which wasn’t hit as hard," he said.
Close to 12 percent of Californians who moved away went to Texas. But more than one million Texans also moved. “Of the places that Texans are moving to who have moved since 2007, CA is the top state," said Stoll.
Just over 10 percent of Texans who left Texas went to California.
Michael Stoll says real estate and construction have suffered in California, but the state is seeing growth in technology, manufacturing and trade.
But Milken Institute’s Ross DeVol says he is concerned that potential jobs are not being created in California because of the business climate there. “A permit to build a new mall in Texas might take three to four months tops. It can take three years in California to get the same permit," he sid.
DeVol is concerned that California-based firms are choosing to expand in other states such as Texas. “Apple, they acquired a supplier to the iPad of about 100 employees in the Austin area a year ago and they’ve announced they are going to expand.”
But there is a positive trend for California. In the first quarter of this year, more than half of all the venture capital funds invested in the U.S. took place in California. And Michael Stoll says, overall, when Americans move, they are heading for the southern and western parts of the country.