> I've been hearing lots of business owners complaining about California's labor laws getting increasingly hostile which leads companies to relocate or move as many resources they can outside of CA
I’m almost 50, and I’ve been hearing and reading lots of this my whole life.
But somehow California’s economy keeps doing well, even without being one of the places that are winning the battle to attract the firms that are optimizing for maximally emoployee-hostile labor laws.
California had just had its net population change going negative for the first time recently. There is a threshold where more businesses leave that it’s starting to reach. The cost of living doesn’t help along with crime. Climate change will also make the situation worse in the coming years, where we eventually lose temperate weather in exchange for forest fires. We’re already experiencing failing infrastructure like regular blackouts and issues with the bridges.
The state’s main saving grace for business is that non-competes are not legal in the state. It’s lucky that no other state is smart enough to do the same thing yet. If Oregon or Washington did it, it would be game over.
I can only add my anecdotal observations for whatever that is worth. When I left California in 2021 it was impossible for me to get equipment from U-haul, Penksy and Budget. I eventually gave up and hired a moving company despite having downsized my assets considerably. Even that was a challenge and the coordinators were spread extremely thin. Every company I spoke to said that they've never seen so many people leaving. I don't know what that translates to in real numbers. I also experienced something odd and unexpected. I would call a friend to say I was moving and they said they were too. This happened several times. Of the people in my circle that didn't leave it was either family or work obligations that was keeping them from relocating despite many wanting to.
> California had just had its net population change going negative for the first time recently
How much was it because of the pandemic causing work from home, which led to new employees joining remotely and not relocating to California, young people who lived here to move somewhere cheaper. The net growth might possibly increase in the coming years.
Were it not for discrepancies I how federal policy effects states, the Supplementary Poverty Measure would be an excellent measure of how well you are doing at distributing the returns of economic activity generated. As it is, it's a decent measure anyway.
California (contrary to a lot of the images people have of what a progressive state would excel at compared to a more conservative one) is excellent at generating aggregate economic activity with great conditions for capital and a narrow elite labor segment, and very bad at distributing those aggregate gains to the rest of society. (To be fair, there is a very significant way in which that compared to other states, is because the more you fail at the first, the more the feds will ship money from the states that succeed at it to you as long as you commit to spend it on the second, so part of why Missippi looks better is that the gains of the strong aggregate economy California generates are skimmed at given to reduce local poverty in places like Mississippi, not based on relative need as measured by the SPM, but based simply on Mississippi’s weaker aggregate performance.
economy doing well? are you telling me that cities that are completely unaffordable and overrun with crime, homelessness, and drug abuse - along with mass exodus - are signs of a healthy economy?
I live here. I'm fighting the good fight - and it isn't working. It's getting worse every day.
So demand massivley outstrips supply. If people aren't living in such horrible circumstances (crime, homelessness, drug abuse), why is demand so high that houses are unaffordable?
I don't know if you've been in California recently, but in the East Bay at least a large number of small businesses have closed down and formerly vibrant places now look like homeless encampments. I used to feel comfortable taking out my phone even after dark on BART, now I don't. The economy might still be chugging along but it's not chugging along on the back of the big cities with ultra liberal takes on crime/homelessness/drugs, it's mostly chugging along due to the suburbs like Newport Beach, Pleasanton, etc. Those places have substantially more conservative views on crime/homelessness/drugs (Newport Beach is actually a Republican district) and don't really tolerate the sort of behavior we see in SF.
Seriously, just check out downtown SF if you don't believe me. It feels dead. There are more beggars than tourists. I recently went to a nice restaurant near the MacArthur BART station and not only was it dead, the area around it felt like I was visiting the hood near USC.
> why is demand so high that houses are unaffordable
It is not that demand is so high but that supply is so low. When you have SFH zoning with massive set back requirements you can't fit many people into the available space.
Downtowns are always kind of dull and empty outside of work hours. They exist to house a temporary population of millions for 8 hours a day, 5 days a week; after those 8 hours, they are totally abandoned ghost towns because it's not like you can use office buildings for some other purpose at night.
Some cities are better at mixing commercial and residential real estate so you feel this effect less. Downtown Chicago always felt eerie to me on nights and weekends. Everything is just closed and there are very few people around. Manhattan is less like this. (There was a time when I would leave work between 11pm and 2am. The bike ride down 2nd Ave was always chaos. The city never sleeps.) I haven't spent a ton of time in San Francisco, but it strikes be as being closer to Chicago than Manhattan. After work, everyone is out in the neighborhoods.
In my non-expert opinion, people in California go to bed earlier than in New York. I feel like everyone thinks they need to be up for work at 5am to "beat the traffic" and be in the office for calls at 9am New York time. This means they are in bed 9pm. Meanwhile, you can stay out until midnight in New York and be sentient again for the same 9am call.
> I don't know if you've been in California recently, but in the East Bay at least a large number of small businesses have closed down and formerly vibrant places now look like homeless encampments.
Despite the positive things I said upthread about the long-term trends, there is a very acute short term issue caused by the interaction of the inadequate response to the aggregate and distributional impacts of the pandemic with the preexisting housing affordability issue that is going to become a major long term problem if it isn't addressed.
> Seriously, just check out downtown SF if you don't believe me. It feels dead.
Wouldn't we attribute this more to COVID, though? This thread is talking about a hypothetical poor economy due to businesses leaving because of employee-friendly labor laws. In early 2020 downtown was pretty vibrant.
> There are more beggars than tourists.
I get that you're exaggerating for effect, but c'mon. I saw plenty of tourists/shoppers in the Powell/Market area in the middle of a weekday last week, out and about, doing their thing.
> Wouldn't we attribute this more to COVID, though?
It's been my anecdotal experience that hot areas in other cities like New York and Chicago are not dead like SF and the East Bay are. Nor are they as sketchy - I'd feel comfortable walking around Millennium Park at night and be pretty confident I wouldn't get robbed. Can you say the same about the Embarcadero?
> hypothetical poor economy due to businesses leaving because of employee-friendly labor laws
Tons of small businesses are dying out and you think the poor economy is hypothetical? Just because Chipotle and McD's can afford to pay every surcharge CA/SF imposes through labor laws doesn't mean small businesses can afford to. It's ironic, because despite all those surcharges the suburbs are still more affordable for a low skill worker than SF is, primarily because the supply of housing is so much better.
2 coffee shops in my local area have closed down recently for good. Starbucks is still going strong, but that doesn't mean the local economy is vibrant.
> I saw plenty of tourists/shoppers in the Powell/Market area in the middle of a weekday last week, out and about, doing their thing
Hmm, I went last week on a weekday and I'd put it at 50/50 homeless/beggar vs tourist. Powell St. BART/Union Square area. In any case, it was certainly a lot worse than a few years ago when it would be more like 95% tourists. I saw multiple homeless sleeping in Union Square which would have been unimaginable 3 years ago.
> It's been my anecdotal experience that hot areas in other cities like New York and Chicago are not dead like SF and the East Bay are.
The Bay Area experienced a massive internal-to-California (largely
to the Sacramento area) outmigration during the pandemic, which removed a lot of support for businesses from locals, and tourism hasn't recovered from the pandemic and related restrictions.
This has been (on paper) great for me as a Sac area homeowner, but more to the point here it makes judging California economic health by looking at Bay Area brick-and-mortar business district vitality potentially very misleading.
> In any case, it was certainly a lot worse than a few years ago when it would be more like 95% tourists.
Federal COVID-related domestic air travel restrictions (other than masking, which continues) only just ended, and federal international air travel restrictions still exist. This impacts tourism, obviously.
> cities like New York and Chicago are not dead like SF and the East Bay are
I haven't been to SF, but I have been to New York. I was shocked how dead the area around the WTC was on a Monday morning (I'd just arrived and walked arround for an hour or so absorbing the city and trying to find a hardware store to get a UK-US plug as it had been so long since I travelled internationally). My local town in rural UK was busier than 8AM Monday morning downtown New York. That can't be healthy. This was about 7 weeks ago.
I ate dinner at Co Nam on the corner nearest MacArthur BART last night and it was absolutely jumping with a huge wait. On my way there I rode down Telegraph through Temescal and there were ridiculous crowds of people on every block. On my way home after East Bay Bike Party (1000+ people easily) there was still a big line of people waiting to get into Marufuku Rame even at 10PM. And there was the typical crowd at Kingfish Pub.
The idea that the East Bay somehow died in the last two years is ridiculous.
If downtown SF is dead, then people aren't living there, demand is very low and thus apartments are very cheap through simple supply and demand.
You may want to increase density in downtown SF, and that's a reasonable decision, but you are claiming fewer people are there now then there were a few years ago. I don't believe there's been any drop in the number of housing units in the city, so that must mean apartments are empty. Is that the case?
I think from a politics standpoint yeah I’m kind of a doomer. I identify as liberal but the people running on liberal platform are really dumb and their opponents are insane/dumb in other ways. There’s no good options to vote for. Idk how we will manage to wade through that.
I kinda think part of the problem is the pervasive expectation that there should be someone to vote for with a Platform They Believe In And You Should Too. That's fundamentally at odds with the mechanics of our system, where you need to build coalitions of people who can at least agree that this set of compromises is better than the set pitched by the other candidates.
And actually, I think finding compromises is fundamentally what this tech is for, right? "How do we make decisions with neighbors we disagree with, mostly without shooting?"
But because platforms are compromises, the demand for leaders that Truly Believe in their platform gives us people pretending to be crazy and stupid. With maybe some genuinely crazy and/or stupid mixed in (but I'm not confident that I can actually distinguish) and lots of layers of "it's complicated" on top.
> I kinda think part of the problem is the pervasive expectation that there should be someone to vote for with a Platform They Believe In And You Should Too. That's fundamentally at odds with the mechanics of our system
Yeah, our systemic duopoly and the associated requirement for backroom coalition building (and the associated papering over of differences for marketing purposes) to build viable parties is a significant defect in our structure of government compared to many other modern democracies.
Hah! I identify as [Republican] but the people running on [Republican] platform are really dumb and their opponents are insane/dumb in other ways. There’s no good options to vote for.
Weird comment. Could you define gentrification? For decades, "Gentrification" has the go-to for the people that applaud tesla leaving and Amazon being rejected by New York. Ironically, those same people are strong proponents of zoning and centralized planning of the whole state. Pretty fed up with their outsized control and demonization of anyone that tries to make things better.
> are you telling me that cities that are completely unaffordable and overrun with crime, homelessness, and drug abuse - along with mass exodus - are signs of a healthy economy?
The parts of that that are real long term issues, particular unaffordability problems (of which homelessness is an effect) absolutely are an effect of a strong aggregate economy that the pro-labor and redistributive policies haven't been enough to keep with; so is the “mass exodus“ (that is, the domestic out-migration mostly in lower-income segments that has for a long time been slightly above domestic in-migration that has had substantially higher average income, that only became net overall outmigration with recent federal policy and COVID-related curbs on international immigration.)
Unaffordability is a result of the enormous wealth of capitalists and elite labor that aggregate economic strength has produced driving up costs.
I’m almost 50, and I’ve been hearing and reading lots of this my whole life.
But somehow California’s economy keeps doing well, even without being one of the places that are winning the battle to attract the firms that are optimizing for maximally emoployee-hostile labor laws.