California exodus

California became part of the United States after the Mexican–American War. Like much of the land ceded from Mexico in the war, California had only a small non-Native population.[9] However, the California Gold Rush led to a population boom, during which California gained statehood in 1850. In the period between the 1850 and 1860 censuses, the state population more than quadrupled. It saw a second period of growth in the years after World War II because of the aerospace and defense industries, and a third during the 1980s and early 1990s because of the Silicon Valley tech industry. Population growth slowed in the mid-1990s as the federal government cut aerospace spending after the end of the Cold War, and again after the Great Recession.

According to the California Department of Finance, the state had 135,600 more people move out than moved in from July 1, 2019, to July 1, 2020, marking the third straight year of net migration losses.[10] After peaking just shy of 40 million Californians,[11] by 2020 into 2022 onward this slowing had crossed the ZPG mark into outright negative population growth for the first time in over a century.[12]

The state has had a net loss of domestic migrants every year since about 1989,[13] and in the period from 2015 to 2019 it had a net loss of at least 100,000 domestic migrants per year due to more Californians moving to other states than vice versa.[8] According to Census Bureau estimates, 6,185,000 people left the state in the 2010s decade, while 4,934,000 moved in—for a net loss of 1,251,000 residents.[14]

The change is visible in state-to-state migration flows. In 1955–1960, the ten largest state-to-state migration flows involving California all had the state as a recipient of people. This is contrasted with the period 1995–2000, where nine of the ten largest flows involving the state had California as a net loser, with only New York sending more people to California than it received in return.[15]

In 2021, more than 360,000 people moved out of California, especially going to states like Texas, Arizona, and Washington. Some are even moving to Mexico to avoid the 2021–2022 inflation surge, as Mexico is more affordable to live in than the United States.[16] Between April 2020 and July 2022, the state's population dropped by more than 500,000 people.[17]

San Francisco is suffering from the opioid crisis, with the 2nd highest rate of drug deaths in the country.[18] Like many other large cities in California, San Francisco also contains a large homeless population relative to the rest of the United States.[19] Following the pandemic, many tech workers have embraced remote work, causing about a third of the commercial real estate in downtown San Francisco to be empty.[20] With rising house prices and the aforementioned challenges facing the city, San Francisco has been described as having entered a "doom loop" similar to Detroit, with the downtown portion of the city having only 32% of the cell phone activity as pre-pandemic levels.[21] A doom loop occurs when one harmful factor causes another harmful factor, exacerbating the original problem and pushing people out of the city. Others argue that doom loop claims are exaggerated. They argue that the crisis is isolated to downtown San Francisco rather than city wide and that San Francisco has always been a "boom and bust" city.[22]

Several businesses, particularly Silicon Valley companies, have moved their headquarters out of California in recent years. Some of the largest businesses that have announced moving their headquarters include Charles Schwab, Oracle, Palantir, and Hewlett Packard Enterprise.[23] Though they have moved to a variety of other states, Texas has received many of the new headquarters, including those of Hewlett Packard Enterprise and Oracle. Businessman Elon Musk moved from California to Texas in late 2020, though his company SpaceX remained in California.[24] Frustrated by California's Covid-19 lockdown policies, Tesla relocated its headquarters to Austin, Texas in 2020 next to the company's gigafactory.[25] However, in 2023 it announced opening its engineering headquarters back up in Palo Alto.[26] Jeremy Boreing and Ben Shapiro, in September 2020, moved their company The Daily Wire to Nashville away from California. They cited California’s drug and crime problem and California’s left-wing politics as their primary reasons for departure.

A variety of causes have been given for the California Exodus, many of them relating to cost of living. Kenneth P. Miller of The San Bernardino Sun said in 2022 that taxes, as well as rising costs on housing, food, and other needs and wants, are the biggest reason for Californians leaving the state.[27] According to the Los Angeles Times, housing cost is the primary reason, followed by long commutes, crime and pollution.[17]

In a December 2020 column for the Los Angeles Times, journalist Michael Hiltzik argued that California's slowing population growth is a cause for concern but not indicative of a full-blown crisis. Hiltzik quoted demographer Hank Johnson from the Public Policy Institute of California as saying that recent data "is just an incremental change from what we've been seeing over a couple of decades." According to Johnson, California's population trends don't compare to the "hollowing-out" of Rust Belt cities such as Cleveland, Detroit, and St. Louis, which have lost more than half their populations in the last 50 years. Hiltzik instead says that a lack of affordable housing is California's main problem, as it has pushed young people out of the state, and that concerns about over-regulation are being exaggerated.[13]

Researchers from several universities, including the University of California, Berkeley, the University of California, Los Angeles (UCLA), Cornell University, and Stanford University, started studying California's population in the fall of 2020. In July 2021, the researchers published their findings, which found "no evidence of an abnormal increase in residents planning to move out of the state."[29] This research was based on forward projections from a survey,[30] asking participants "Have you given any consideration recently to moving out of California?" and was not based on realized net domestic migration data.