Speculating the demographic impact of the Recession on California: Part I
Who is the most likely to leave California
While the incoming recession could have different implications for demographic trends than the pandemic, during covid, California experienced its slowest growth in recorded history. California actually lost population (a decline of 600k people between 2020 and 22’), from a peak in January of 2020. This decline was due to the exodus, but also covid deaths and declining fertility. Throughout much of the 2010s, California actually gained affluent residents from other states while lower income Californians disproportionately left. However, since the pandemic, enabled by remote work, there has been an exodus among the wealthy, an acceleration of a trend that actually begin around 2018. The Public Policy Institute of California reported that “Most striking, California is now losing higher-income households as well as middle-and-lower-income households.” LA Times’ George Skelton, who had previously been downplaying the exodus, recently admitted that he was wrong, stating that “This is what I wrote two years ago: “More affluent people have been moving here than departing. They can afford our escalating costs of living. Political spin about wealthy people abandoning California is fake news.” On a similar note, Governor Newsom blamed the exodus on Trump’s immigration policies, which is absurd.
Source: New York Times
Looking at stats for California’s metros, Los Angeles, San Francisco, and San Jose metros all lost a significant amount of college educated residents. However, San Diego, Sacramento, and Riverside metros, gained college educated residents, likely from the exodus out of LA and the Bay Area. While LA’s college educated exodus began sooner, the Bay Area was gaining large numbers of college educated residents throughout the 2010s, so the shift was obviously due to the tech exodus. Much of the 2010s in-migration of the wealthy was due to the tech bubble creating a lot of high paying jobs in Silicon Valley.