There is a fierce debate about whether or not California is business friendly. Those who believe California is bad for business usually point to our state’s high tax rates and regulations. Those who say California is good for business note that our GDP is the eighth largest in the world, and say we are established as a global center of innovation with the world’s largest tech firms.
Despite California’s reputation as not being business friendly due to its higher tax structure, a study that examined other trends showed the state is still a good place to do business.
The study found the state is attractive for creating and sustaining successful businesses, and also that California is creating jobs faster than the national average.
While many of those new jobs are created by existing businesses, many are also coming from new firms, according to the report.
A new study finds that California isn’t nearly as hostile to business as its reputation would suggest.
In fact, the state ranks near the top in several key economic measures, such as net job creation and the rate of startups. This is a big deal for two reasons: New businesses create far more jobs than old ones, and California’s high ranking comes despite its onerous costs for taxes, land, energy and other key inputs.
California is outpacing the nation in employment growth, and many of the jobs are coming from new businesses.
That’s one of the takeaways from the newly released California New Business Creation report, commissioned by the nonprofit organization Next 10 and prepared by Beacon Economics. The study dispels the notion that the Golden State’s unfriendly business climate has sidelined its economy.
A BIGGER ECONOMIC PICTURE
A new analysis shows California ranks high in the rate of job creation compared to other states.
The report, "California New Business Creation," was written by Beacon Economics for the nonprofit, nonpartisan group Next 10, which is based in San Francisco.
Next 10 founder Noel Perry says the analysis uses 2013 U.S. Census data to show California's "business climate" compares well to other states.