Monday, February 22, 2010

California's Hostile Business Climate:
100 'Moving-Out-of-State' Events


It's no mystery what causes companies to leave California -- high taxes, undue regulation, workers’ comp costs, a legal environment stacked against businesses, and lengthy and costly construction permitting requirements.

Other contributing factors include agencies being staffed with individuals unsympathetic or even hostile to business concerns. Wildly excessive government spending contributes to unpredictable government behavior at the state level and also the local level.

Apparently, No state agency keeps track of enterprises that move out of California or which companies elect to expand in other states even though they are headquartered here. That lack of knowledge is quite convenient for elected officials who deny that state's anti-business attitudes and policies hurt commercial enterprises. Hence, without a central repository, it's difficult to determine how many jobs are lost specifically because of California's unfriendly business environment.

In this blog, I've attempted to note facility moves and disinvestments in California on a catch-as-catch can basis based on incomplete media reports. Below is a roundup of activity that I've been able to find since I started this blog in July, 2009. This imperfect and incomplete list of 100 moving-out-of-state events is the "tip of the iceberg" about the loss of commercial enterprises in California:

Abraxis Health, a unit of Los Angeles-based Abraxis BioScience Inc., opened a new plant that will create 200 jobs in 2010 -- in Phoenix. This follows the company's Phoenix expansions that occurred in 2007 and 2008.

Alza Corp. in 2007 eliminated about 600 jobs in drug R&D while also exiting its Mountain View, Calif., HQ. At the time the company said that its 1,200-person Vacaville facility will continue to operate. But the Vacaville Reporter on Oct. 23, 2009 revealed that the plant is being offered for sale by J&J, its parent company. It's unclear if more layoffs are in the facility's future.

American AVK, a producer of fire hydrants and other water-related products, moved from Fresno to Minden, Nevada.

American Racing moved its auto-wheel production to Mexico, ending most of its 47-year operation in California.

Apple Computer has expanded in other states, most recently with a $1 billion facility planned for North Carolina.

Audix Corporation relocated from Redwood City, Calif., and to accommodate growth moved to a 78,000-square-foot facility in Wilson, Oregon.

Apria Healthcare Group of Lake Forest is shifting jobs from California to Overland Park, Kansas, a K.C. suburb.

Assurant Inc. cut 325 jobs in Orange County and consolidated positions in Georgia, Ohio and South Carolina.

Automobile Club of Southern California placed 1,100 jobs in Texas.
Barefoot Motors, a small "green" manufacturer, moved from Sonoma and will grow in Ashland, Oregon.

Bazz Houston Co. located in Garden Grove, has slowly been building a workforce of about 35 people in Tijuana. In early 2010 the company said it expects to move more jobs to Mexico, citing cost and regulatory difficulties in Southern California.

Beckman Coulter, a biomedical test equipment manufacturer headquartered in Brea, relocated part of its Palo Alto facilities to Indianapolis, Indiana, two years ago. In early 2010, it's making a multimillion-dollar investment to expand and create up to 100 new jobs in Indiana. The company said the area offers a "favorable business environment and lower total cost of operations, plus a local work force with strong skills in both engineering and manufacturing."

Bild Industries Inc., which specializes in business news, directories and market reports, moved to Post Falls, Idaho, from Van Nuys, a part of the San Fernando Valley in Los Angeles.

Bill Miller Engineering, Ltd., suffering under the "hostile business climate" in California and Los Angeles County, moved from Harbor City to Carson City, Nevada.

BMC Select has conducted an unusual relocation. The company, which had shifted its headquarters from Idaho to San Francisco, relocated its H.Q. back to Boise in January 2010. The building materials distributor said that regaining its footing in Boise retained access to high-quality employees while reducing wage and occupancy costs.

BPI Labs, which formulates, manufactures, and fills personal care products for the health and beauty industry, relocated from Sacramento to Evanston, Wyoming, a move the company's owner called "very successful . . . . It felt good and I’ve never looked back.â€