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The Economic Trends of California vs. Texas

The Economic Trends of California vs. Texas

Op-Ed: Are Californians fleeing en masse to Texas? The reality is complicated

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Opinions about the California’s economy and about how California and Texas compare can get muddled and complex. There can be an ideological component to both views – with Democrats and Republicans viewing the two states quite differently – and economic factors can be critical in shaping people’s opinions.

The economic trends are more evident in California than they are in Texas, but are important to watch for both states as the state’s economy grows and shifts its workforce.

Here’s a primer:

What is the Texas economy?

As the second most populous state in the U.S., Texas has experienced a boom in job creation. Since the Great Recession, the state has added an average of about 5,000 new jobs per month, according to data provided by Texas Economic Development, a state-funded agency.

In contrast, California is one of the least-unionized states in the country, with a total labor force of just over 200,000. California also has a high proportion of people who have jobs at one firm (as opposed to those without work), which is unusual.

The unemployment rate in California is 6.3%, according to the U-S Bureau of Labor Statistics, much lower than the national average of 8.3%. California’s labor participation rate (the official unemployment figure divided by the civilian labor force) is currently at a peak of 62.4%, which reflects the number of people employed at one firm, not by a multiple of their work force.

But the Texas economy, which is heavily reliant on oil and gas industry, has grown by just 1% since peaking at $2.2trillion in 2008, according to Texas Economic Development. Texas’ economy has also become more dependent on trade than California’s.

Is the Texas vs. California debate about jobs or the state of the economy?

While the debate about California taking a hit in the current recession is a political one, many people who work in the state are concerned about a potential economic meltdown in Texas.

“I hate to say it, but I think the state we want to live in today is not the state we live in today,” former Texas Gov. Rick Perry said to an audience at a Houston business forum in December 2011.

A recent study from

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