“California Dreaming” is a household phrase, California is a place with huge potential for businesses to thrive, with a large audience always ready to buy products, and the location’s population always growing. It seems like the perfect hotspot to move your business to. Which begs the question, what’s causing the massive outbreak of companies leaving their business settlements, and families who have been living here for generations to suddenly leave?
According to Motorbiscuit’s “10 States Where Tesla Sells the Most Used Cars”, California has 45% of all new Teslas registered, and 30% of all used Teslas registered. However, on May 9th, 2020 Elon Musk announced that he has had it with California and would be leaving immediately to Texas & Nevada. There were two main issues Musk had with his current location. For one, authorities in Alameda forced him to close his Fremont factory temporarily because they were not following Covid-19 protocols. He however took it upon himself to reopen without permission, which caused some of his staff to contract Covid-19. Along with this, California has an 8.84% tax rate for Corporations other than banks, which in Texas the tax rate for retail and wholesale is 0.375%. The tax margins between the two are huge, likely causing Texas to be the first place businesses move to when leaving California.
A widespread move has been seen in California. People who have been living here for years and years, people who have established their families & careers here are suddenly moving out, in massive groups. It’s a trending pattern.
People can no longer afford to live here due to the cost of living. San Jose is now the 31st most expensive city to live, in the entire world! With the median cost of living prices being $610 per square foot, average prices of homes currently listed are $925,000 and rent are $3,400. While minimum wage is $13 per hour for small businesses and $15 per hour for larger businesses, the price of everything else is going up along with it. Adding to this, San Jose & California is rich in technology involved jobs, however only those. Causing those with the jobs here, stuck here as these jobs are difficult to find anywhere else, making it difficult for people without those jobs to stay afloat. For example, a former San Jose resident who lived here for over 35 years just decided to move out. She goes by Nai, and she explained to me how the need to stay somewhat in the Bay Area stems from her special needs daughter with a heart palpitation, however she also went on to tell me that they would have moved out of California completely if it were not for that. Nai said how “even with one person working full time at a manager’s salary and help from the government for the kids you just can’t get your money’s worth here.”