According to the Tax Foundation, California currently ranks next-to-last (only New York is worse) among U.S. states for “business tax climate”. When a state, or nation for that matter, is hostile to businesses within its borders, business leaves. So do the jobs. Because, as economist will often say, when you tax something, you get less of it. Check out the graphic to the left showing the number of companies leaving California weekly before reading the analysis of consultant Joseph Vranich below.

Today, California is experiencing the fastest rate of disinvestment events based on public domain information, closure notices to the state, and information from affected employees in the three years since a specialized tracking system was put into place.

Out-of-state economic development officials are traveling through the state to alert frustrated business owners and corporate executives to their friendlier business climate versus California’s hostility toward commercial enterprises.

  • From Jan. 1 of this year through this morning, June 16, we have had 129 disinvestment events occur, an average of 5.4 per week.
  • For all of last year, we saw an average of 3.9 events per week.
  • Comparing this year thus far with 2009, when the total was 51 events, essentially averaging 1 per week, our rate today is more than 5 times what it was then.

The top five destinations are (1) Texas, (2) Arizona, (3) Colorado, (4) Nevada and Utah tied; and (5) Virginia and North Carolina tied.

Graphic from the Tax Foundation.

Note: Click to enlarge.