California may end up losing about 40,000 people when the population is counted for the next census, yet another sign the state’s high cost of living and housing market are having an impact.
Lawmakers say the solution must come from both the state and federal governments.
For the first time since 2010, more people moved out of California than moved in. “California has the highest personal income tax rate. They have the top 10 highest corporate income tax rate,” said Adam Michel, a senior policy analyst with the Heritage Foundation.
He says California’s high taxes and regulations have discouraged developers from working in the state. “These things make it harder to add new units. When there’s fewer houses being built, fewer apartments, it means the price has to go up,” Michel said.
“In reality what we need is middle-class relief,” Rep. Judy Chu, D-Calif., said.
But Chu points to other factors, including California’s failure to meet housing goals. She says Congress should do more to help. “There has to be an increased effort on building affordable housing, that’s really where our efforts should be,” Chu said.
California’s Department of Finance estimates about 197,000 people moved out of the Golden State this year. Most are moving to states like Texas, Nevada and Arizona.
All this is happening as California’s economy is growing and the unemployment rate is at a record low.
But Rep. Doug LaMalfa, R-Calif., says that growth doesn’t reach all corners of the state. “That’s all on the coasts, man. The inland here, we’re still suffering,” he said.
LaMalfa says middle-class Californians don’t feel the benefits of the state’s growing economy. “It’s really two different worlds. That’s why so many that have the ability to are getting out,” he said.
In the short term, LaMalfa expects people to continue moving out of state in big numbers.